Manage your finances monthly
Carving out some time to manage your money can cut out the financial fear.
Life can get very busy, especially when children are involved. Finding time between work and running a household can be a chore in and of itself. But as you are managing your time, don’t forget to budget in some time to manage your finances. You may just glance at your finances when a check comes in or a bill comes due, but if you plan time to sit down and really review your finances, you can benefit greatly.
So when is a good time to manage your money? Setting some time out once a month may pay off considerably. If you were to spend an hour or two once a month, you would gain greater knowledge and more than likely keep your financial obligations and setbacks to a minimum.
What you can do each month is to take the pulse of your purse to stay healthy financially. Michigan State University Extension suggests the following topics you can cover each month. You don’t have to do all of this each month, but there is always something to do with your money.
Look at your budget
What money is coming in and where is money going out? Was there an item that was not planned for? Did the water heater break? Did you receive a speeding ticket? This is a good time to check your spending habits too. Where is your discretionary spending going to? Do you spend too much money on specialty coffee or going out to lunch each day? Where could you cut back on spending to save more? Would this be time to refinance your mortgage? All of these things can and should be reviewed periodically.
Know your savings
Do you have enough savings in case of an emergency? If the water heater does break or the car needs a major repair, would you be able to cover it? You will need to keep your savings at a comfortable figure that is right for you and your family. As your family grows, your comfort level figure might grow too. Assess monthly that figure and adjust it to meet your needs.
Plan for the future
In the future, you may need to pay for braces, vacations, college, a new car or a new home. Planning for that can save you money and financial hardship. For example, if you were to pay yourself a monthly savings for a future car, you could pay cash for that car when you purchase it and get it at a considerably lower cost. Try not to spend money you don’t have yet. Planning for the future can keep you out of debt and financially secure.
Invest in investments
You may get quarterly reports from your investments, but reviewing them from month to month can keep them on track. Updating them or making small tweaks can make a big difference in the future. Once the money is invested, it’s best not to touch it – out of sight, out of mind, but better to guide it. It is a good idea to keep an eye on how your investments are performing and make any adjustments as you move through the changes in your life.
Research for riches
It is also beneficial to occasionally research financial topics or to talk with an advisor. There is a plethora of information on the Internet on topics of investing, saving, retirement, loans, taxes, portfolios and other money-related topics. Reading books and articles are advantageous too. You can also check out the Fiscal Management webpage at MSU Extension.
Guide your retirement
You may not have to look at this monthly, but occasionally you will need to review and adjust your retirement plan. It’s good to set it up early in life and just let it build. Take an assessment of what it is at yearly and where you might make adjustments to it. If you get a raise at work, you could just add that to your retirement. You could adjust your contributions or if you change jobs your employer may contribute more and that might affect your investments.
Your drive is to be financially secure, and with a little time invested in managing your finances, you can save money and even make money! Plus, cutting time from managing your money could cost you. So, allow time in your busy schedule to oversee your income and keep you from “starving” financially.
For more information about money management and budgeting, check out the Youth Money Management webpage and the Fiscal Management webpage on the MSU Extension website, as well as the Michigan 4-H Youth Development website.