Practicing Good Money Management

The Importance of Training your Kids in Money Management

Although giving kids an allowance is ok, we rarely realize that it is also very important to teach them to spend it wisely. Merely giving purchasing power in the hands of children does not ensure that they gain the maturity to use it responsibly. It is necessary to train your kids in money management right from an early age.

This helps them understand when and why to save and when and where to spend. By understanding the value of money and the way to use it judiciously, the children grow up to be financially responsible adults.

Teaching the Importance of Spending Within Means

By getting kids to keep track of their spending you help them understand the importance of budgeting for different expenses. With budgeting comes the awareness that spending substantially on one item will mean less or no money for another. The limits on spending that are established in this way inculcate a habit of spending only within the means.
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Money Management for Young Couples

One of the common fights that young married couples have is over money. What is the best approach in managing those greenbacks that have become such an essential part of our lives yet the cause of frustration and arguments? Here are some immediate steps you can take to organize your finances as a new couple.

It is wise to have a joint checking account for shared expenses like rent and utilities. Keep separate individual checking accounts for personal spends – this can go a long way to prevent arguments about spending and finances.

Managing your finances together means not just covering all your expenses but also putting away something for the future – saving for a new home, your kid’s education, and other priority areas. Start a savings account. One of the most important things about managing money is understanding compound interest. Use it to the benefit of your family’s financial future.

A budget is an absolute necessity. Start by creating a list of recurring expenses you will have every month. Subtract the total from your monthly income. Ideally, there should be quite a bit of balance left over. If there is, you can go ahead and invest a portion of that amount into various financial instruments of your choice. Also make sure you set aside some of the balance for a separate emergency fund to prepare for any unforeseen events.

If you don’t have a balance or have a negative balance, then it is the time to cut down on spending. Have a relook at the items on your expenses list and see where you can cut down. Here are some suggestions on how to keep costs low.
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Educating Your Kids About the Basics of Money Management

Money management is not just for adults – kids who are taught the value of dollars early on grow up to become good money managers and usually don’t have debt issues.

As a responsible adult, you must sit with your kids and teach them the rights and wrongs as far as money is concerned. For this, you have to be a financially responsible adult yourself and try to set an example for your kids. Children are highly impressionable and you should use the opportunity to introduce the concept of cash generation and spending so that they go on to make good financial decisions when they become adults. [Read more…]

3 Most Common Money Management Mistakes

It is easy to fall into a financial mess, especially these days. It also seems impossible to keep up with all the financial advice, news, and information that comes out each day. While it is true that solid financial advice often stays the same, new mistakes and poor money management options seem to sprout all the time. [Read more…]

Creating A Monthly Budget to Save You Money

Personal savings are reaching an all time low these days as people are spending more, yet earning less. Savings are an integral part of a steady future and should never be ignored, no matter how dire things look at the moment. The best way to ensure that you are on track and staying within your means is to plan a monthly and yearly budget. [Read more…]