The goal of every young man is to be able to attain financial stability before his 40s. Although money can’t guarantee your happiness, it can give you a sense of security.
There’s this joy and fulfillment that comes with aging with less stress. You do not have to do a lot of physical jobs just to make money or be scared of not being able to live the comfortable life you have always dreamed to live.
What It Means To Manage Your Finances
Managing your finance includes planning your monthly and annual budgets, controlling your cash flow, expenses, savings, investments, liabilities, assets, amongst others. As easy as it might sound, being able to manage your finances requires a lot of brainwork, and a little mistake can throw you over the edge financially. Some outcomes of poor financial management include debts, low productivity, inefficiency, low profitability, wrong investment, and shut down of the business. To avoid these outcomes, financial management becomes essential.
Generally, a man in his late 20s and 30s is faced with the pressure of financially securing his future, and this pressure is the number one cause of depression and other forms of mental breakdown in today’s world. In a bid to combat this increasing mental deterioration in the world, we have listed tips that’ll boost your financial security in less than a year.
5 Tips For Managing Your Finance
Already in your 30s? Here are tips you can expect to hear from a financial advisor that can help you manage your finance and in turn, save you the mental stress that comes with attaining financial stability.
1. Assess Your Current Financial Situation
This is not an easy step as it will open your eyes to not just your progress so far, but also to all your lapses, setbacks, and losses. However, anyone willing to achieve a financial breakthrough must be courageous and honest to himself. Assessing your current financial situation gives you an idea and a base to operate on. Knowledge of your current financial situation also helps you to know your financial strength and weaknesses, and this will help you to work towards being better financially.
2. Set Financial Goals
Setting your financial goals is the next step to take after you have assessed your current financial situation. Your goals are the things you want to achieve within a stipulated time. These goals serve as guidelines that help you focus and gain direction financially; they are the rails you hold on to when climbing the stairs of financial breakthrough. When setting goals, avoid setting ambiguous and unrealistic goals. Be sure that you set smart goals; the goals should be measurable and realistic. It should also be specific, relevant, and achievable within the stipulated time.
3. Get A Finance Manager
A finance manager is a professional who is trained to guide and manage your finance. A finance manager helps you to map out strategies that will enable you to achieve your financial goals. He also helps you to make important decisions and take important steps in your finance. Getting a finance manager basically saves you the mental stress involved in carrying out financial activities; he helps you to think about the best capital structure to operate, plan your budgeting, manage your cash flow, advice you on the assets to purchase, the type of investment to make, help you to procure and utilize funds, amongst others.
A lot of people are familiar with the word “investment” but only a few people actually know how to invest rightly. Investing involves putting in money or getting resources also called assets, in order to generate more profits. You can invest your money in a number of things which include real estate, agriculture, rental housing, properties, stocks, shares, fixed interest, government bonds, index funds, mutual funds, corporate bonds, high yielding savings account, exchange-traded funds ETF, cryptocurrencies, annuities, mortgage-backed securities, startups with great growth potentials, amongst others.
5. Evaluate Your Finances Regularly
Financial evaluation helps you to restrategize financially especially when things aren’t working as planned. Check how far you’ve gone in achieving your financial goals, run a check to ensure that your strategies are well followed, check how much you gained and lost, and check for loopholes in your plans and strategies. You can evaluate your finances monthly, quarterly, two times a year, or annually. However, monthly evaluation is more advice-able because it tackles lapses faster.
Other things you can do to help manage your finance includes cutting down excess spending on frivolities, and opening different accounts for your expenses, saving, and investment; this will reduce the chance of you spending from your savings or investment funds. Financial freedom and financial security is attainable if you can manage your finance wisely. Practical applications of the steps listed below will result in up to ninety percent positive turn around in your business, in less than one year.