PERSONAL FINANCE

Personal finance is a management and planning of your personal budget. It includes management of your monetary resources, your financial risks, future life events, banking products, investment, insurance and etc. i.e. is all known as your personal financial planning. Personal finance is quite critical for an individual’s life as it can be a dominating factor related to your financial success or failure.

Financial planning is a dynamic process which requires regular monitoring, revelations, assessments and adjustments of your personal finance which includes handling you expenses in taxes, billing, and investments. It may also include your financial status, personal debt and etc. If you are not managing and planning your finance appropriately you may get into personal debt. Getting into debt may sound scary but it is not as bad as you are thinking if you just take it in a right way. Debt management is one of the most critical techniques in handling with the debt situation. People who fail to manage their debts can get trapped into a debt cycle. Personal debt is something that creates a negative image of debt, but in reality, there are plenty of positive aspects also and the key to that is to make the debt work for you, not against you. Obviously purchasing a house, a car, studying in university and feeding a large family is not affordable for everyone.

Living debt free and having too much month left at the end of your money you earned for this month can be a powerful source of stress, therefore, personal budgeting is important to get your finance under control. Personal budgeting can help you to strategize your expenses in a way that you needs can be met and help you refrain from the lavish lifestyle. Taking debt just to make your life lavish is never be a good strategy to consider. It is bad for your economic health. Building budget upon your priorities is important i.e. budgeting your expense for mortgage or rent, utilities (electric, gas, water, etc.), gasoline and tolls, vocational clothing and care expenses, auto payment and maintence.

After maintaining your expenses of your home, payments and maintenance of other utilities. Next you need to prioritize yourself. What is important to you? Future or fun? Maintaining your expenses for future, it is important to protect your investments with insurance. That is possible by having health insurance, your automobile with car insurance, and your home with home or renter's insurance. This insurance can really help you to safeguard your properties & assets for future.

It is an adult reality of life that we have to live within our means. That means "if you ain't got it, don't spend it". Otherwise you end up in the sticky pit of debt, debt and more debt. Failing to plan is planning to fail. Therefore, it is time to plan to invest in your future. Which includes savings and making life insurances. Putting money in a savings account is a way to pay yourself and prepare yourself for future emergencies. If you value being self-sufficient, then you will prepare for your future. Most people put their entertainment and personal interests ahead of essentials. We haven't even discussed those in this budget, because we are budgeting by priorities. So, after going through this budget, Is there anything left over? Keep it and enjoy it! If not, you will have to cut back or downsize you essentials. People who take care of their primary needs and then spend which is left over are going to be successful in their future needs.

At last you may have good knowledge of budgeting your expenses by now. Be real and be honest about your priorities in life, and think about whether you need to change it or not. Personal financial management typically shows cash flow, your goals, spending trends, net worth, and debt management. It allows you some level of customization for managing their money.