The Basics of Managing Your Finances

Having a good line of credit can give you a good sense of financial security but its better that instead of borrowing you can depend directly on your income and other personal financial resources to solve your money problems? Perhaps this is easily said than done but the truth is, with a little patience and discipline putting aside money for a rainy day is really not that difficult.


Setting up a Budget


Good control and management of your finances starts with knowing how to budget your income. The general rule is to spend less than what you make. This may be a little hard at first but with knowing how limiting your expenses to the bare necessities is a good start. When you have a good budget schedule, there is very little chance that you will need to borrow money with the lowest interest rate personal loan singapore. Second, if you accrue a sizable amount of surplus, you won’t get surprised when unexpected financial crisis comes your way. Third, being able to control and manage your finances means you would have very little of no financial liabilities such as a personal loan. This will increase your credit score and would give you’re a better chance of being approved for investment loans such as mortgage or a business loan. And finally, knowing how and what areas to look where you can save on your expense will give you a chance to raise your surplus even more giving you ways to spend outside of your necessities.


How do you start?


Here are some of the general expenses that you should look into. There is the household bills (electricity, water, etc); living cost (food, groceries); investment products (education, medical & retirement insurance); basic travel expense (car & public utility) and luxury expenses (travel tour, gadgets, etc). Create a balance sheet and put down all of these expenses along with your gross monthly income. From here you will see a clear picture of your income and expenses schedule. You will now be able to come up with a good plan on how to create a good rational plan on how to manage you income against your expenses.