How to Manage Your Personal Finances.. The Easy Way

Managing your finances can be very difficult with all of today's expenses and ups and downs in the economy. There are however textbook ways to manage your finances with out having to use an accountant or buying a textbook.

Things You'll Need

• A Notepad
• Pen
• Calculator
• Your Thinking Cap

Instructions

1. Figure out your net income, that is, money you have on hand after your taxes and other mandatory fees taken out of you paycheck at the end of the week. This is the money you actually make when all is said and done. This is what you really have to work with.

2. Now there are a couple simple rules to managing your finances. That is your income vs. your expenses. If your expenses are greater or any of that to follow happen chances are you should be looking for an extra job or a way to cut down your expenses.

3. There are simple percentages which you should break down your expenses compared to your income. These are (and can be modified to a point)

   40% towards mortgage/rent (housing expenses)
   20% towards your means of transportation (insurance, gas, oil changes, etc.)
   15-20% towards food and other household items. Try to keep this more near the 15%.
   10-15% into your savings account. Saving money is very important just in case anything happens.
   10% towards all the other stuff in your life you can not get around buying. Such as gifts, clothes, more into savings, college fund, pay off credit card bills, or ad to your other areas of main expenses.

4. This easy way to break down expenses into 5 broad categories makes it easier to keep track of spending and the such. It also allows you to compare your income with your expenses. If your income is low so that your expenses in any of these categories is large that your income percentage wise, do not fret too much.

5. If that is the case there are several ways to counteract this. They include, cutting down on some of your expenses; do you really need all those movie channels, use coupons while shopping for food, turn off the lights in your house when you leave, walk to the store to save on gas. There are tones of ways you can reduce your expenses. Another option is to use that 10% extra as a cushion to help when these other methods fail. Then again, there's always the good old, go out and get another job technique which works fairly well. Or just step up your writing on ehow or check out the RESOURCES section of the article for other work at home techniques.

6. These easy steps will hopefully assure that you can control your financial situation no matter what it be. Even if this includes learning that you can afford a better financial situation. Good Luck

Tips & Warnings

• if you go over in these categories do some fixing. Cut back on something or just do something as little as buying the store brand instead of the name brand when you go grocery shopping.

Resources

• In a Financial Pinch Try This