Managing personal finances is a skill everyone should learn. The trouble is modern life makes it difficult to keep on top of the bills, credit card payments, loan accounts and investments. As a result, too many people stick their head in the sand and choose to ignore the early warning signs—and end up in debt as a result. But there are plenty of ways to keep track of your money, so instead of turning a blind eye to your finances, find out how to manage your money in one convenient place.
Different Ways to Manage Your Finances
• The old-fashioned way – If your finances are very simple, you will probably be able to manage with a simple cash book for writing down income and expenditure. Make a note of everything you spend, including the bills, and reconcile it with your bank statement regularly to ensure nothing slips through the net.
• Money management software – Financial planning software can be very useful if you have several bank, savings, credit card, and loan accounts. You can use a financial software package to create budgets, monitor personal banking and create charts and reports to help you monitor your spending and investment portfolios.
• Accountancy services – Accountants don’t usually provide a day to day money management service, but they are useful if you have complicated tax affairs or you have a very high net worth. Accountants can offer you advice on your investments, help you plan for a comfortable retirement, and provide assistance on how to minimise your tax burden.
Is Money Management Software a Good Buy? There are lots of money management software packages on the market. All of them require that you spend some time inputting data about your bank accounts and other home finances, but once you have done this, they are an easy way of keeping on top of your home finances.
Most of the big name banks and financial institutions give their customers access to a wide range of online banking services. Registering for online banking is a great way of keeping a close eye on your personal finances. As long as you have internet access, you can log in to your bank account any time, any place, anywhere. Check statements, pay bills and transfer money between savings and current accounts—it only takes a few minutes when you use online banking.
Monitor Your Money
Whether you use a money software package or not the key to managing personal finances successfully is to get into the habit of monitoring your money regularly. The more often you check your finances, the more likely it is that you will spot cash flow problems before they become a problem. People who are more aware of their finances are less likely to end up in debt. Never ignore financial problems in the hope that they might go away. Money troubles rarely disappear overnight and the more likely scenario is that your money problems will worsen if you choose to stick your head in the sand.
About the author:
Barlow Andrews managing partner, Doug Barden specialises in financial planning. To find out how he can help you to manage your finances better visit http://www.barlow-andrews.co.uk.