What is money management?
Money management is the technique of finding out where you are spending your money, and outline a structured plan for where you want it to go in the future. It is also a technique used to get the maximum interest-yield from the money that you invest.
1. Lay down financial goals: You need to lay down very precise financial goals along with the time period. Goals can be set apart into short-term, mid-term and long-term. Analyze the amount that you need to save now to attain that goal.
2. Get organized: All the financial information should be in suitable order so that you can access them anytime that you require without wasting time. A personal financial directory consisting of all the accounts and other financial obligations will help in staying organized.
3. Keep a track on expense: Tracking your expenses for a few months will help to sort out your needs, wants and facilitate you to lay downa budget.
4. Set a Budget: After investigating the spending and deciding what your wants are, you can set up a budget and try to stick to it.
5. Money Saving: Try and save at least 10% of your monthly earnings. Depending on your financial goals, you can decide to save more.
Where to place your savings?
Several options like Banks, Mutual Funds, Post Offices, real estate and many other are available.
Investing in the Stock Market is a way to beat inflation.
Buying stocks of a company make you become a part owner of that company when you buy stocks of a company.
The chance to gain high returns on investment can be obtained upon Investing in the Equity Market.
The point to be noted here, when the gain is more, the risk is also high.