Personal Finance Management

Personal finance management. You know the feeling. The bills are all paid, and you managed to make a good dent in a couple of credit card balances. All of the statements are tucked neatly away.? Everything is balanced in the checkbook, and there?s a nice little chunk of cash left over.

You think about that hot pair of jeans you?ve wanted to buy.? Yes, it?s a good feeling ? almost better than?well, you know.? Or do you? Maybe you do, but you?re just not getting it enough?? You can get more of that feeling when you learn how to manage your personal finances like a pro.

The biggest obstacle to smooth money management is the chaos people create for themselves.? When bills and receipts are shucked aside into indiscriminate piles throughout the house, and check payments are recorded on slips of paper strewn about your car, a simple monthly task suddenly becomes a dreaded chore requiring much more time than most people are willing to spend.? Take these steps now to organize your financial life and you?ll free up hours of valuable time:

Separate Your Financial Life

Personal finance management begins by keeping your finances separate from every other aspect of your life. Dedicate a small corner of your house to nothing but finances.?

Set up a file cabinet exclusively for your financial documents and past statements.? The desktop or workspace should have nothing on it except an inbox for bills, an envelope for receipts, and one drawer needs nothing in it except your checkbook register, pencils and a calculator.

Un-clutter Your Life

After filing all old statements and bill correspondence neatly away, take the next 60 minutes to go online and convert all of your accounts ? credit cards, utilities, banking, ? to paperless billing. Now you can receive and pay bills online. ?Make sure you change your settings for each account to email monthly statements and set them each for bill payment reminders.

No more clutter.? If needed, past statements can be printed for up to 12 months and older statements are available by request.

Digitize Your Book-Keeping

It?s a big step, and, for some people, a little scary, but using a personal finance software program, like Quicken, can change your life.? It will require a bit of time to get it set up and there is a slight learning curve, so count on an investment of time for the first few months, but the return is huge.?

Here?s the big bonus, many of these programs will import financial data from your bank and your credit card accounts, so, essentially, all of your transactions will be automatically recorded.? Some programs offer check writing as well.? The bottom line is, at the end of the month, it takes only a few moments to go in to your program, add any remaining transactions and reconcile your account.? Cash flow excesses and deficits will carry forward to the next month so you can easily make the necessary adjustments in your budget.

Manage Cash Flow with Credit Cards

If you able to use your credit cards responsibly as part of a cash management plan, they can be the best way to control your budget and manage your cash flow. Most of the major credit cards offer online access to your accounts so you can view purchases and payments in near real-time. Some also enable you to view your transactions and cumulative totals by category so you can easily correlate your spending with your budget. Plus, when they are linked with a personal finance software program, all of the transaction data can be easily download into your monthly budget and plotted in budget forecasts.

Budget for Success

Did we mention that you need a budget for personal finance management? You can?t run a successful business, or even a household without a budget. And, if you have any serious financial goals, short or long term, that you want to achieve, it?s not likely to happen unless you budget for them.

Short-term, if your goal is to pay off a credit card, or save for a vacation, you?ll need to live by a budget. Long term, if your intent on securing your retirement, budgeting is the way to find the excess cash flow for your savings.

Personal finance programs will force you to establish a budget, and nearly manage your budget for you. But if you forgo the software, get yourself a spreadsheet pad.? Set a budgeting goal ? i.e., pay off a credit card; save an extra $100 a month, etc ? and then track your progress each month.

Managing personal finances like a pro is all about preparation. The more you can do up front to organize and automate your finances, the easier it becomes.

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Source: http://www.directbanc.com/about/personal-finance-management/

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