Most of the people tend to enter the new year with dreams and high hopes of improving their financial circumstances. They plan on paying off their debts, cutting off their expenses, investing and saving more.
After all, with the dawn of the first day of the year, as you make your new year’s resolution getting fit or losing weight should not be your only priorities. Start new business Financial growth, can be your resolution too.
Those of you who have been disciplined investors and savers already, the best resolution for you would be sharing your pro tips with those who you know are not good in managing their finances.
To improve your financial life, you need to improve your money management. Here are some easy ways of becoming financially smart in your new year.
1. Decide a Budget and Make Sure to Spend According to It
Making a budget helps you in figuring out where to invest your money instead of wondering where it has gone. Decide a budget with your spouse or your family and assign where you spend what amount before the start of the month.
2. Filling Up Your “Piggy Banks” for Emergency Savings
It is important to save funds for emergencies, which come up without prior notice (hence the emergency). Not having a safety net will make you go extremely negative about each negative news.
However, if you have saved enough for say three or six months of expenses, you will have the ability to cruise through your life (emergencies included), with less stress and constant alteration for your financial objectives.
3. Investment is Pretty Important
Before we discuss this, you should know that investments are not emergency savings as they have to be liquid. These savings can be anything except your contingency fund. Putting all your money idle into a savings account, which gives you little interest each year is not wise because inflation can eat up a large chunk out of it every year. Hence, investments are a good option but don’t invest in something that you don’t understand. It can have bad consequences.
4. Financial Planning and its Monitoring is a Must
Doing comprehensive financial planning will help you in comparing your financial position earlier and at present. If you are able to do this properly, your future self will thank the younger you.
5. Avoid Borrowing for Impulsive Shopping
Sometimes, you may come across some furniture or gadgets that are too expensive for you. You may end up taking a personal loan in UAE for the same. Now, the rate of interest on personal loan in uae that lasts for months (even years in some cases) will keep going but you have lost your interest in the item you bought. Well, you know-how are going to feel about this.
6. Signing a Financial Document Without Going Through It is a Big NO
This is amongst the most common mistakes that the maximum people make and it needs no explanation. So just remember going through the paperwork is very important.
7. Don’t Issue a Cheque If You Don’t Have Enough Balance in Your Bank Account
Issuing cheques in bad faith is a criminal offense in the UAE. Make sure that you have a sufficient amount of balance or save money for the amount before the due date of the cheque.
8. Do Not Invest in Quick-Rich Schemes
Despite many reports on expats being fooled by lucrative get-rich-quickly kind of schemes, some of them still fall for it. There are many people who fool you into buying credit cards and you end up getting a huge financial hit. It is important to remember that if something is too good to be real, then there are high chances it isn’t. Therefore, don’t fall for such traps, do your research and choose wisely.
The Bottom Line!
Make your financial life easy with these tips on how to be financially smart. Enter 2020 with good mental, physical, and financial health.
About the Author:
Pardeep Garg is online entrepreneur, and author. He is passionate about Market Research and loves to write on topics Market Research, Business, Digital Marketing, Finance, Information and Opinions to success in life.
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