Money has a vital role in our lives as it pays for everything that we need, which means that we can’t escape it and we have complicated relationships with it. Every person will save and spend money differently, but there is always something that we can do to help us manage our money better.
Here are questions that you should be asking about your money.
Are You Prioritising Your Expenses Properly?
Like many of us, you probably try to stick to a budget every month. If you don’t have a budget in place, then it’s time to create one. When you are setting up your budget, you will need to look at what your priorities are.
You need to be honest about what you need and what you want so you can spend correctly. You are allowed to buy things that you want, but you will need to satisfy your needs first like groceries, accommodation and so on before you look at your wants like new clothes, a new TV, a new car and so on. You also need to reign in your spending on wants and not go over the top.
Are You Spending Money On Things That Matter to You?
Take a look at your budget and see if your spending habits reflect your values and if those values are compatible with financial security. If they don’t match up then take a look at what you can change so that your budget aligns better with your saving goals, your beliefs and your overall financial plan.
What is the Last Thing You Regret Buying?
What were your last purchases? Do you regret anything that you bought? If there is, you are not alone. If you have a regrettable purchase then think about why you are unhappy with your purchase, why you bought it and what you can do to stop yourself buying items that you will regret later.
Impulse buying is a problem and often these are the purchases that we regret. Before you buy anything rather take some time to think about the purchase. More often than not, you will either forget about the purchase or realise that you don’t need it.
Do You Have Too Much Debt?
Debt can easily get out of hand and it could just take one more purchase to push you over the edge where you will not be able to keep up with the monthly repayments. If you find that you are already stretched and any other expense will push you over, then you need to get a plan together to pay off your debt as quickly as possible.
If you are already over your head in debt and are already struggling, then you can consider seeking the help of a debt counsellor or can use a debt consolidation loan to help with your debt.
If You Didn’t Have Debt What Would Your Budget Look Like?
Imagine if you didn’t have any debt and interest payments to make and you were able to put that money somewhere else like a retirement annuity, a trip away or anything else. The quicker that you can get your debts paid off the quicker you will be able to start putting that money towards things that matter.
Are You Able to Increase Your Income?
If you are not earning enough right now, then you need to think about ways that you are able to change this. You can get a part-time job, freelance, tutor or upskill so that you are able to get a raise or a better position at your current workplace. If you have a small business idea, then it might be an idea to start with this. However, if you are thinking about starting a small business then you need to apply caution as you do not want to end up in more debt.
Where Do You Want to Be in 5 Years?
When you have clear financial goals, it keeps you focused. If you don’t have any then set some and then determine the steps you need to take to achieve these goals whilst also planning for any obstacles.
Are You Setting a Good Financial Example for Your Children?
One of the most important things you can do for your kids is to teach them about managing money and looking after money. You don’t want your kids to make the same mistakes as you and suffer financial problems. You can’t just tell them what to do with their money, you also need to show them. You need to set a good example and give them a small allowance so that they can start practising financial principles.