HOUSEHOLD BUDGET
BALANCE OF INCOME AND EXPENDITURE
Maintaining a balance between income and expenses is important:
You can avoid financial stress by managing a household budget, and learn ways to
manage a household budget. Set short-term goals, medium-term, and long-term
goals and avoid wasteful spending.
Where is your monthly income spent? Do you have any account of
this? You will surely agree that most of your income is spent on household
expenses. Home management should be understood if money is to be saved from
waste. A budget has to be prepared for that.
Money Management
Money management is also important. By doing this, stress caused
by financial problems can be avoided. First, let us know what is household
budget management? What should be kept in mind for this?
Meaning
Of Household Budget Management
Experts say that household budgeting means calculating your
household expenses. Can you also find out how much money is spent where? How
much money can be saved per month? Apart from this, you can also know the
expenses incurred on your lifestyle. Household expenses include expenses like
paying essential bills, paying EMIs, meeting savings and investment goals, and
school fees.
Tips
for Making a Household Budget
A household budget can be prepared in several ways. A great way
to do this is to make different envelopes. How much money goes and where? Now
there are also many mobile applications where you can maintain such accounts.
A
Household Budget Can Be Divided Into 5 Parts
Dividing the budget into different areas keeps expenses under
control. You can keep daily expense records in a daily budget, weekly expenses in the weekly budget, monthly expenses in a monthly budget, half half-year budget in 6 months, and a full year in an annual budget. There are a few things to keep in mind while
making a budget. This will help us while preparing the budget. The budget
should also be reviewed consistently.
Set
Goals for the Budget in Three Parts
When you set a goal for a budget, it can be broken down into
several parts. It helps us to know how to use the money for short-term, medium-term, and long-term goals.
YOUR
INCOME AND EXPENSES
Income and expenditure must be balanced. For this, you can make a
diary in which you can keep a record of all the expenses.
Monthly
Expenses
The largest portion of income is spent on monthly expenses. So
keep a separate account for monthly expenses.
Monthly Savings
Your savings also depend on your income. Now let me assume that
a person earns thirty thousand rupees per month. So he has to keep these things
in mind before determining the amount of savings.
How
Many People Are In His Family:
It is most important to see how many members are in the family
of a person earning Rs 30,000 per month. That means how many people are
dependent on that person's income. For example, if four people depend on his
income, his expenses will be different and if two people depend on him, his
expenses will be different.
In
Which Area He Lives:
It is a simple fact that living in a city is more expensive than
living in a village or small town. Similarly, there is going to be a lot of
difference in the cost of living in Surat and Mumbai. So, along with the
income, one should also see where the family of a person who earns 30 thousand
rupees per month lives.
It
Also Needs To Consider The Needs Of:
Every family has different needs. If there are fathers or
children in the family, their expenses may be relatively high. If two members
of the family are pursuing higher education or if one is getting married, the
cost will be different. Thus, it is very important to consider the needs.
One
rule is famous: the 50/30/20 rule
According to this rule divide your monthly income into three
parts - needs, want,s and savings.
You should spend 50 percent of your income on things that are
important to you. Without which we cannot live. Like household groceries, rent,
utility bills, children's education, EMI, and health insurance. After that,
spend 30 percent on what you want. These are expenses that can be avoided, but
spending on them brings happiness. Like watching a movie, going to a parlor,
shopping, doing hobbies, or eating out.
When needs and wants are over comes the question of saving.
According to the 50/30/20 rule, you must save at least 20 percent of your
income. It should be used for retirement planning and emergency funds.
4
PRINCIPLES OF SPENDING AND SAVING
Earning money is not a big deal, but wisdom lies in how much
money we can save. We all make investments but sometimes our investments get
lost. The adage that the legs should spread as wide as the bed sheets has been
around for years. In fact, this is not just a saying, but the biggest mantra of
the financial world. Although we all think this way, we often do the opposite.
Many times we spend a lot of money thinking of our hearts. But when the debt
reaches your neck, get rid of it we make
even bigger mistakes to fall. Let's understand this with an example.
BUDGET
As you start earning, first decide your budget. Be careful with
money. Keep track of every penny. Control costs. Decide if what you are
spending on is worth it to you. For example, many expenses like shopping for
clothes, going to a movie, going out for dinner or lunch can ruin your budget.
Spend money on it according to the budget. All these steps will help you save.
LOAN
One needs to be absolutely careful when it comes to loans. Avoid
taking loans early in your career. It is often seen that young people tend to
buy heavily when starting their careers. For that, they also take the help of loans.
They understand when they have to pay back with huge interest. In the meantime,
if some other situation deteriorates, it becomes very difficult. That is why
Etihad is important.
SAVINGS
I always advise my friends, family, and clients to learn to pay
themselves first. Start saving from small savings. Save regularly. For example,
get student loans for kids at affordable rates. Be very careful when buying on
credit. For long trips, use the pass closest to where you work. Always buy a
used book. Ignore the late-night parties. Make multiple goals, small, medium,
and large. This will help you achieve your goals.
EMERGENCY
FUND
Always maintain your funds, it is the most important weapon to
deal with sudden problems. For example, if you lose your job or you need
medical treatment, this fund will come in handy for you.
KNOT
THIS LAST THING
It is very important to understand your financial situation
before starting to invest. If you have any loans with high-interest rates, pay
them off first and keep four to six months’ worth of expenses in your savings
account. Also, you should know how long you are going to invest the money. This
will determine which options you want to invest in. Also, it is important to
know how much you know about investment options. If you are not familiar with
investment options, there is no harm in taking the help of a good financial
planner.
Summary
When
it comes to saving, your income is the most important factor because, to some
extent, you are limited by your income. When it comes to saving money from your
monthly income, your focus should not be on how much you earn, but on how much
you save from your income. Statistics show that most people spend more money
when they have more money. As the income increases, the standard of living also
increases. 'Wants' quietly turn into 'needs' and things that were once luxuries
turn into necessities. This mindset creates a problem, a big problem. You can
continue to 'enjoy' life in the way you choose, but at the same time, you are
also limiting your ability to build wealth. And if you're living beyond your
means, you're inviting a major financial crisis. The truth is that saving money
from your salary requires a lot of discipline and honesty.
PLEASE BE AWARE
All the information in
the above article is collected from various websites through the internet.
According to the subject, this information has been presented to you with
necessary modifications. The Compiler does not take any responsibility for its
authenticity and cannot guarantee 100% about the points and information
presented therein. Readers are requested to enjoy reading. The information
given here is based on religious belief and folk belief, there is no scientific
evidence for it. It is presented here keeping in mind the general interest.
No comments:
Post a Comment
If you have any doubts, please let me know