It is unfortunate that personal finance is not a required subject in high school or college. Not surprisingly, most young adults are fairly clueless about how to manage their money when they step into the real world for the first time after landing their first job. Finance professionals never cease to stress that laying the right foundation at the beginning of your career is the key to future financial success. All it takes to get started on the right path is the readiness to do a little reading – you don't even need to be particularly good at math.
Here are some steps to take now to put your financial future on track and live a comfortable and prosperous life.
1. Practice Self-Control
Self-control is the stepping stone in managing your finances better. You need to learn the art of delaying self-gratification. In other words, do not purchase any item without measuring its consequences on your finances. If buying that item will not put stress on your finances, go ahead with the purchase. If you have the habit of using your credit card for shopping, use it wisely. And do not carry too many credit cards that you cannot keep track of.
Credit cards should be used only for the convenience of making purchase without the burden of carrying cash. Never use credit cards for consumption using the credit facility offered by this instrument.
2. Set Goals
It is important to have goals to motivate you and save your money. Goals can be of different time horizon – short-term, medium-term or long-term. Short-term goals include saving a few hundred rupees every month. Medium or long-term goals include being able to repay a home or car loan. Ensure the goal motivates you enough to help stay on track within your budget. By being clear about what you want to save for, you can become a more successful saver.
3. Follow the Money
Once you've set your financial goals, make a budget. Once you see how your morning java adds up over the course of a month, you'll realize that making small, manageable changes in your everyday expenses can have just as big of an impact on your financial situation as getting a raise. It helps you plan how much money you’ll spend and how much you will save. It also gives you a clear representation of your financial affairs and helps you live within your means by evading unnecessary