March 16, 2020 Last updated February 25th, 2021 1,700 Reads share

Why It’s so Difficult to Manage Money: The Way Forward

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Money is a very important commodity in the world. With money, there is an unlimited number of things that you want that money can buy. Even if you ever get enough money to buy everything you ever need, before you finish buying them, some of them would already have newer versions that you might want to dump the old ones for.

Apart from the wants and trying to buy up everything in the world that we fancy, there are needs that we must meet. Even though the 3 major needs that you would have to spend money on are food, clothing, and shelter, there are now many other things as good as needs as long as you live in a civilized world. Examples of such items include electricity bills, having a mobile phone, buying airtime, subscribing to Internet services and transporting. There are simple steps we can take in order to start saving at home. For example, if you live in Texas, you have the power to choose alternatives and can compare hundreds of electricity providers with varying rates and types of electricity plans to choose from.

Meeting all these things that are now as good as needs is the reason why managing money is very difficult. Furthermore, if you can meet all of them, there are millions of other wants that the remaining money would want to be used for.

Money management is very important as it would help us not to get indebted or stranded whenever we need money. Here are some tips that would help you manage money effectively.

Start Saving

Once you receive any payment, save a percentage of the capital, say a minimum of 10 percent of the total. You can then begin to spend the rest on the things you need and want. Try not to be tempted to touch your savings for any reason. One of the things that work for me is to assume that I only earned 80 percent of my income and that I didn’t have any other money anywhere after saving the 20 percent. I try to deceive myself that the money does not exist and I treat the money that way. The only exception would be a life-threatening emergency or instances where I would have borrowed money to meet that need. In some cases, I go ahead to borrow the money than touch the money if it is not coming with interest. That way I am more disciplined to pay back without my savings being affected.

Use Money Management Apps

Sometimes, you get money but you are surprised that it is all gone and you are wondering what you used the money for. If you are wondering how to manage your money, then you can get a money management software. Money management apps like Pocketsmith help you track what you spend your money on. It will become easier to spot the leakages or unnecessary things you spend money on that you can watch out for.

Leave Some for Miscellaneous Expenses

Apart from your savings, leave another 10 to 20 percent of your income for various expenses. This way, whenever something urgent and essential comes up that you didn’t budget for, you can sort it out. You should then make your budget within the rest of your income after creating a table of preference and listing everything you would be needing for that particular month.

saving money – DepositPhotos

Feisal Elmi-Nooijen

Feisal Elmi-Nooijen

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