Financial Consultant Advise on Cash Management
Managing Your Day to Day Cash
People can earn a lot of money; what they struggle to do is manage that money on a day to day basis. Having an effective cash management system to do this is the key to managing the achievement of your goals; whether that is purchasing a home, buying a new vehicle, a holiday, the kids’ education, saving for retirement or getting rid of unwanted debt.
Cash management is not just about writing a budget. Those people, who are good with their day to day finances, know what I mean.
You can start with writing a budget, but really this is about ‘guestimating’ what you actually spend. If you are reading this, you’re probably not that good at managing money, so don’t panic if you have no idea. If you don’t have the ability to check bank statements or online accounts, just guess in the first instance. Make sure you also put your income in your budget – this will be important when you total the figures and check where you might be over spending or under spending.
They key to discovering your spending habits is actually about recording what you spend each time you make a purchase. A small note book is very important here; use it to write down each expense you make, or you can keep your electronic transactions receipts in it to write up later.
At the end of the week compare your weekly ‘guestimated’ budget with what you actually spent…so this is the start to an ‘actual’ versus ‘budget’ system for you. You can do this on a monthly or fortnightly basis if you want to, although I prefer weekly in the first instance (so you can keep a close eye on expenses). There is a reason for doing this apart from the obvious one of keeping track of your spending . . . every time you go to spend, your mind will start to think “Do I really want this?” or “Do I really need this? Is it essential spending?”
Once you’ve got your spending under control, plan for the things you want. After all it’s important to look forward to something you really want, so rewarding yourself is vital to your financial success.
For more financial tools, easy-to-use money calculators, and free financial advice visit Barry Kloogh at http://www.TheMoneyCookbook.com?money_tips. Barry Kloogh is the author of The Money Cookbook, and a top financial consultant with offices in Dunedin, New Zealand and the United States.
Barry Kloogh (www.TheMoneyCookbook.com)