For those who have never made a budget before a monthly budget planner can be a good way to get your feet wet. Organizing your finances can be an exasperating experience if you've never done it before, but it an important step if you want to win back your financial freedom. Knowing where you money goes and what it does is probably the most important thing you need to control if you want to succeed with money.
Before deciding on which type of budget planner to use it is best to start with a written budget using nothing more then a pencil and paper. This helps you get used to the idea of actually making a personal budget and gives you and idea as to where you stand financially. Writing down all your income and expenses is the first step to getting organized.
Once you are ready to move to something a little more sophisticated you can start using pre-printed budget sheets. These sheets have categories for both income and expenses which can be helpful in organizing your finances. All you have to do as you sort through your bills and check book register is plug your financial information onto the correct line.
These pre-printed spreadsheets can be printed off of internet sites that offer free budget sheets or you can find them at just about any office supply store. The only problem with these sheets is you won't always be able to match your finances to the right category which means you may have to write them in by hand.
If you are good with computer spreadsheet software then you may consider creating your own custom budget using something like Microsoft's Excel. There is an amazing amount of flexibility in using this type of software to build a monthly budget. You can customize it to do just about anything, from tracking monthly income and expenses to tracking retirement accounts, investments, and mortgage amortization rates.
If you aren't of the computer geek mentality don't despair because there are budgeting software programs that already have everything you need right out of the box. The two best well known are Microsoft Money and Quicken by Intuit. These powerful programs can handle just about any financial task you can throw at them. They will even allow you to download your financial information directly from your bank and financial institutions you do business with. From budgeting to financial planning these programs do it all.
As you can see there are quite a few options when it comes choosing a monthly budget planner. No matter which option you choose building a budget is the first step to taking back control of your financial well being.
Saturday, May 10, 2008
Control Of Your Finances
Does life feel like it is spinning out of control? Has a high-flying lifestyle set you on a crash course toward financial ruin? Have your credit card balances snowballed beyond your control? Then it is time for you to take control of your finances.
To have successful money management, wealth accumulation, and financial freedom, you must take control of your finances. No one else is going to do it for you. You are responsible for your finances.
“Money doesn’t manage itself,” Robert Schuller.
1. Figure your current net worth. You can not take control of your finances before you know what your current financial situation is. You need to know what your current net worth is. Is it positive, or is it negative because of all the debt your family has accumulated? Do you have investments? Valuable antiques? Valuable personal property? Debts? Credit card bills? A home mortgage? You can use our printable net worth worksheet to help you figure out your family's current financial position.
2. Start a record file system. If you desire to become financially successful, you need to keep track of your financial records and statements. Keep in mind that disorganization costs money. Buy a small file cabinet and start keeping and organizing all financially related papers.
3. Income and expense record book. You also need a clear picture of what the family’s total monthly income is. How much are you earning? Your spouse? Are there interest and dividend payments you could add to your total monthly income? You must know how much money is coming in to your household and how much is being spent. Include every purchase and every cent. You will never be able to take control of your finances until you have a firm understanding of your current income and spending habits.
4. Start a budget. Start a budget, and stick with it. Once you know how much income you have and where and what you are spending your money on, you can create a budget. You do not need a certain “income” to budget and save money. All it takes is the self-discipline to learn how to save and to take action to save a little bit each paycheck.
5. Create financial goals. After you have a clear picture of your current financial position, create a written list of goals you desire to accomplish. Get out of debt? Save enough money equal to 6 months income for emergencies? Pay of the auto loans or student loans? Start investing in an investment program, such as a Roth IRA? Save enough money to purchase your family's own house? Where do you desire to be financially one year from now? You may want to create several lists of goals in a time-frame of six months, one year and five years. Place your list on the refrigerator door so everyone in the family will see it and constantly be reminded of what your family is shooting for.
6. Taking control. If you have followed the above by calculating your current net worth, organized all your family's financial records, created a record book of your income and expenses, started a budget, and created financial goals of how much you desire to accomplish, you will be taking control of your finances. You will no longer be controlled by bills, debt and uncontrolled spending, but rather, you will be saving money, getting out of debt, accumulating wealth, and becoming financially independent. You will be saving your way to success. Congratulations and good luck on your endeavors!
To have successful money management, wealth accumulation, and financial freedom, you must take control of your finances. No one else is going to do it for you. You are responsible for your finances.
“Money doesn’t manage itself,” Robert Schuller.
1. Figure your current net worth. You can not take control of your finances before you know what your current financial situation is. You need to know what your current net worth is. Is it positive, or is it negative because of all the debt your family has accumulated? Do you have investments? Valuable antiques? Valuable personal property? Debts? Credit card bills? A home mortgage? You can use our printable net worth worksheet to help you figure out your family's current financial position.
2. Start a record file system. If you desire to become financially successful, you need to keep track of your financial records and statements. Keep in mind that disorganization costs money. Buy a small file cabinet and start keeping and organizing all financially related papers.
3. Income and expense record book. You also need a clear picture of what the family’s total monthly income is. How much are you earning? Your spouse? Are there interest and dividend payments you could add to your total monthly income? You must know how much money is coming in to your household and how much is being spent. Include every purchase and every cent. You will never be able to take control of your finances until you have a firm understanding of your current income and spending habits.
4. Start a budget. Start a budget, and stick with it. Once you know how much income you have and where and what you are spending your money on, you can create a budget. You do not need a certain “income” to budget and save money. All it takes is the self-discipline to learn how to save and to take action to save a little bit each paycheck.
5. Create financial goals. After you have a clear picture of your current financial position, create a written list of goals you desire to accomplish. Get out of debt? Save enough money equal to 6 months income for emergencies? Pay of the auto loans or student loans? Start investing in an investment program, such as a Roth IRA? Save enough money to purchase your family's own house? Where do you desire to be financially one year from now? You may want to create several lists of goals in a time-frame of six months, one year and five years. Place your list on the refrigerator door so everyone in the family will see it and constantly be reminded of what your family is shooting for.
6. Taking control. If you have followed the above by calculating your current net worth, organized all your family's financial records, created a record book of your income and expenses, started a budget, and created financial goals of how much you desire to accomplish, you will be taking control of your finances. You will no longer be controlled by bills, debt and uncontrolled spending, but rather, you will be saving money, getting out of debt, accumulating wealth, and becoming financially independent. You will be saving your way to success. Congratulations and good luck on your endeavors!
Tuesday, March 25, 2008
Finance Planning Through Credit Counselling And Services
A credit counseling agency is actually much more than a mere counselor; they are your companions on the path of your getting free from debt. They have to be with you every step of the way, guiding and assisting you in becoming debt-free. In fact, how soon you become free from your indebtedness will depend on which credit counseling agency you have chosen.
In order to help you in selecting the right credit counseling agency, we enlist the functions that they ought to perform. Here they are:-
Understand the financial situation properly.
Everyone's financial problem is unique. Even when you are talking about something particular like credit cards, there are different factors that need to be taken into the picture. That is why the credit counseling agency must hear out the problems of their clients completely. They must understand all the factors involved in their singular problem.
Prepare a monthly budget plan.
Just as everyone's financial problems are different, everyone's income capabilities and sources are also different. The job of the counselor is to make a list of all the sources from where money can be pooled in per month, and a list of all the outgoings involved, not just the credit card bills. There must also be some relief for contingency expenses that are sure to crop up month after month. The agency must chalk out this budget plan for their clients, because if the clients were able to come up with a plan themselves, they would not have been in this financial problem in the first place.
Provide suggestions for solving the credit debt.
Next on the agenda are the suggestions that the counseling agency must provide to the clients. They must tell of all the options that are possible for solving the indebtedness. They might suggest things like refinancing a loan to avail of lower rates of interest. They might also suggest consolidating several loans that the clients might have into a single loan, payable to a single lender at a reduced rate of interest. Or they might even suggest borrowing a loan in lieu of an asset they have, like home equity, in order to pay off their high credit card debts (home equity loans are always at a lower rate of interest than credit card payments). These suggestions are not something that a layperson can think of him-/herself. That is why it is the duty of the counselors to suggest these ideas.
Offer their services.
Every credit counseling agency must have services for the suggestions they provide. For example, if they suggest clients to consolidate their loans, they must provide the consolidating services too. They must explain to their clients what consolidation actually means, how much they will have to pay as charges, and how much they will save at the end of day.
Thus, the counseling agency has a huge responsibility - it starts by understanding the problems of the clients, then makes proper plans for them and finally implements them. They are present throughout the process of credit debt solution for their clients.
In order to help you in selecting the right credit counseling agency, we enlist the functions that they ought to perform. Here they are:-
Understand the financial situation properly.
Everyone's financial problem is unique. Even when you are talking about something particular like credit cards, there are different factors that need to be taken into the picture. That is why the credit counseling agency must hear out the problems of their clients completely. They must understand all the factors involved in their singular problem.
Prepare a monthly budget plan.
Just as everyone's financial problems are different, everyone's income capabilities and sources are also different. The job of the counselor is to make a list of all the sources from where money can be pooled in per month, and a list of all the outgoings involved, not just the credit card bills. There must also be some relief for contingency expenses that are sure to crop up month after month. The agency must chalk out this budget plan for their clients, because if the clients were able to come up with a plan themselves, they would not have been in this financial problem in the first place.
Provide suggestions for solving the credit debt.
Next on the agenda are the suggestions that the counseling agency must provide to the clients. They must tell of all the options that are possible for solving the indebtedness. They might suggest things like refinancing a loan to avail of lower rates of interest. They might also suggest consolidating several loans that the clients might have into a single loan, payable to a single lender at a reduced rate of interest. Or they might even suggest borrowing a loan in lieu of an asset they have, like home equity, in order to pay off their high credit card debts (home equity loans are always at a lower rate of interest than credit card payments). These suggestions are not something that a layperson can think of him-/herself. That is why it is the duty of the counselors to suggest these ideas.
Offer their services.
Every credit counseling agency must have services for the suggestions they provide. For example, if they suggest clients to consolidate their loans, they must provide the consolidating services too. They must explain to their clients what consolidation actually means, how much they will have to pay as charges, and how much they will save at the end of day.
Thus, the counseling agency has a huge responsibility - it starts by understanding the problems of the clients, then makes proper plans for them and finally implements them. They are present throughout the process of credit debt solution for their clients.
Finance Planning Through Green Credit Cards For Environment
n the last few years, environmental awareness charities have been working overtime to help us understand exactly what cost to the environment human activity incurs - and with good effect. These days, the average person works overtime to minimize their carbon footprint and make sure they conserve as much energy as possible: whether that's by participating in reforestation projects, taking a stand against flying or simply remembering to recycle waste products.
However, as the demand for green products from our service providers continues to rise, this demand has also spread to the credit industry. In fact, a recent survey undertaken by APACS - the UK trade association for payment providers - shows that the credit card industry is now catering to consumers who want green credit cards more than ever before.
According to APACS spokeswoman, Sarah Quinn, there has been a "sea change" with respect to the terms of credit card companies providing more environmentally friendly financial options. Ms Quinn commented:
"The current agenda, which is very green conscious, will be something that the market is very aware of. Credit cards particularly are very, very responsive to what customers want and if this is something that customers want I'm sure you'll see more of them."
She further remarked that, while green credit cards will appeal to a number of financial credit consumers, they may also let many borrowers down. This is because while green credit card providers will often donate money to charities, they may fail to offer competitive balance transfer deals or interest rates.
When looking for environmentally friendly credit cards, green consumers are likely to look for two key factors: the ability of the credit card to donate to environmental charities and whether the material from which the credit card is made is environmentally conscious. Many credit cards are made from PVC which, when incinerated, releases highly toxic chemicals into the atmosphere - chemicals that can alter and disrupt development, reproduction and growth across the world.
If you're a credit card owner and you're keen to switch your credit card provider to one that is more environmentally aware, you'll find a variety of green credit card options available to you. Barclaycard, for example, have just released a new green credit called 'Breathe', which gives money to green charities and is made from environmentally-friendly material. What's more, many consumer comparison sites on the internet will allow you to compare credit cards and other deals from major credit card companies, so you can be sure that you'll be able to find the greenest credit card on offer.
However, as the demand for green products from our service providers continues to rise, this demand has also spread to the credit industry. In fact, a recent survey undertaken by APACS - the UK trade association for payment providers - shows that the credit card industry is now catering to consumers who want green credit cards more than ever before.
According to APACS spokeswoman, Sarah Quinn, there has been a "sea change" with respect to the terms of credit card companies providing more environmentally friendly financial options. Ms Quinn commented:
"The current agenda, which is very green conscious, will be something that the market is very aware of. Credit cards particularly are very, very responsive to what customers want and if this is something that customers want I'm sure you'll see more of them."
She further remarked that, while green credit cards will appeal to a number of financial credit consumers, they may also let many borrowers down. This is because while green credit card providers will often donate money to charities, they may fail to offer competitive balance transfer deals or interest rates.
When looking for environmentally friendly credit cards, green consumers are likely to look for two key factors: the ability of the credit card to donate to environmental charities and whether the material from which the credit card is made is environmentally conscious. Many credit cards are made from PVC which, when incinerated, releases highly toxic chemicals into the atmosphere - chemicals that can alter and disrupt development, reproduction and growth across the world.
If you're a credit card owner and you're keen to switch your credit card provider to one that is more environmentally aware, you'll find a variety of green credit card options available to you. Barclaycard, for example, have just released a new green credit called 'Breathe', which gives money to green charities and is made from environmentally-friendly material. What's more, many consumer comparison sites on the internet will allow you to compare credit cards and other deals from major credit card companies, so you can be sure that you'll be able to find the greenest credit card on offer.
Thursday, February 28, 2008
Financial Success System And Financial Objective
More often than not, people associate success with money and wealth. While that is a lopsided view of success, it is true that success often brings with it financial rewards; it is also true that many people who aspire to success are thinking of the financial rewards that will follow when they succeed. But what if your idea of success is purely financial? In that case, it could be that you are looking for a financial success system that will help you achieve your financial objective.
In two other articles I discussed the use of project management techniques in achieving personal success. In that case, we looked at "Project Success" and how we could plan for it. Why not apply more business techniques, this time to money, and develop a financial success system or plan?
In most respects, your personal finances are no different to a business's finances. The underlying principles are the same. As a former professional management accountant, I can assure you that the way a company's or organisation's finances are, or should be, run is fundamentally similar to the way your own finances should be run.
Every company will have systems in place that are designed to further the success of the company, as well as protect its assets from misappropriation. In effect, they put in a financial success system that should enable them to run the business profitably and by so doing build assets.
The main elements of a company's financial system can quite easily be recognised as good practice in your own personal financial system. The statutory requirements are quite different, but from a financial management point of view there are some helpful similarities an individual can learn from.
If you apply some of the following business finance fundamentals to your own approach to personal finance, then over time you will develop a finance success system that will grow your wealth for the rest of your life.
1. Budgeting
Setting and managing budgets is a routine part of any business; they are a key tool in financial control. A home budget is vitally important too. Get into the habit of setting and monitoring your personal budget of income and expenditure, and you will have the foundation of a financial success plan.
2. Investment Appraisal
Whenever a company decides to spend money on a large capital item or new product, for example, it may carry out an investment appraisal. You will not have such large spending decisions to make, but the important thing is to consciously assess the expenditure. Will it build your financial success or hinder it? For example, if you are buying a car, which will depreciate, there is a high risk it will diminish your personal assets significantly and set back your finance success plan. When it is time to indulge, be sure it is the right time.
3. Building Assets
A company builds assets by consistently being profitable, investing wisely, and developing the business at a sensible and sustainable pace. Being profitable is earning more revenue than you spend in expenditure. The same is true of you as an individual; always ensure you earn more each month than you spend. The balance (savings) goes into your spare assets, which can build over time, especially with sound investment.
4. Balance Sheet
Creating a balance sheet in a large business can be quite complex. A simplified version may help you keep an eye on your own asset status. Preparing a rough balance sheet once a year, showing your assets on one side and liabilities on the other, will give you an idea of your personal worth, in financial terms. By comparing year on year, you can ensure you are making progress.
If you use a home budget software program, it may have a balance sheet facility to help you.
5. Regular Financial Reporting
Companies have a legal obligation to produce accounts each financial year. Your legal requirements are for your personal tax purposes only.
However, a business does not rely just on annual accounts, and nor should you. It is likely they will have management accounts on at least a monthly basis, to allow management to keep track of the way business is progressing. You should also follow that example, and keep a close watch on your budget each month, and react accordingly.
6. Cash Flow Forecasting
Even a profitable company can have problems keeping going if it does not manage its cash flow properly. In fact, it is a common reason for companies to cease trading. As part of your budgeting, ensure you incorporate cash flow forecasting, that way you can allow for peaks and troughs in income and expenditure without hitting problems with paying bills on time.
Missing payments can prove expensive to your overall wealth, so is best avoided at all times.
7. Investment and Treasury
If all goes according to plan, you will have surplus cash. A company will have a treasurer for that, but in your case that treasurer is you. Take that role seriously, and over time you will be a financial success. If you have a partner, it makes sense to involve them in this, and other parts of your plan for financial security.
Investment is a fascinating subject, so if you can learn about it, you will be well placed to do better than an average investor. Investment is about balancing risk and return, and if you can master that without taking silly risks, you should do well financially.
On top of those purely financial aspects, there are other key areas to a business that will affect finances that you could learn from:
1. Marketing.
Keep an eye on the market place for the type of success you are seeking and your areas of expertise. Try to anticipate how that market may develop and prepare yourself ahead of everyone else. You are worth more if you are ahead of the game, whatever field you may be. For example, when I was 20 I decided it was a good idea, long term, to learn as much about computing and finance as possible, as eventually they would be key in every organisation. That was before pc's existed, and it proved a sensible decision, even though my main aim was to be a writer.
2. Education and Training of Key Personnel
As an individual, the more you educate yourself about many aspects of life, both personal and commercial, the better placed you are to become wealthy. Never become complacent about your own knowledge; over time it will decline in importance, so you need to refresh it constantly. Train yourself, educate yourself, continuous.
Those are just a few ideas of how you may use business finance practices to build your own financial success over the long term. Follow those, and you should not go far wrong, and prepare yourself for a rebound should anything ever go wrong, such as redundancy or divorce, which can scupper even the best of financial plans.
Plans To Achieve Your Financial Goal
If you want to achieve your financial goal, don't fall for get-rich-quick scams. Instead look at the possibilities offered by sound financial planning that can help you achieve your goal. If you deem this tedious and hard to follow, this is understandable especially if you are not taking home a fat paycheck. As they say, quitters never win; in this game plan, all you need is a steeled resolve to stick to your plans to achieve your dream of financial security.
Have Goal Will Plan
Achieving your financial goals is best started with a financial plan. Your personal finance goals should be clearly spelled out. Devising a safety net for the unpredictable future, demands you lay down all your financial cards, in the hope that someday the plan will pay dividends when you most need it.
Ask yourself what you need to have a secure future and your questions will determine the way your goals will be achieved. Achieving your goals may seem highly improbable because you fail to see the numerous possibilities and options where to put your money.
Sound financial advice can bring you nearer to your aspirations. Depending on your purpose, your financial plan will be adjusted accordingly. Whether you are simply hoping to pay your insurance faithfully to the last dollar or to see your investments working, things will depend on your determine to succeed
Plan for Financial Stability
Once the plan is finalized, it is your turn to make it work. Stay focused on the plan. Financially successful people say it is a difficult task to adhere strictly to the plan but they plodded on looking forward and the financial gains waiting for them at the end.
To stay focused towards your dream of security and gains, ask yourself the following questions:
-What do you wish to achieve?
-How much money do you need to invest?
-How long will it take to realize your financial gains?
-Can you fit in the additional drain in your budget?
With a financial planner to monitor your accomplishments, you can always be on guard to do what you are supposed to do--follow the plan to the letter to achieve your financial security and eventually reap your financial gains.
With a financial planner to monitor your accomplishments, you can always be on guard to do what you are supposed to do--follow the plan to the letter to achieve your financial security and eventually reap your financial gains.
Subscribe to:
Posts (Atom)