There isn’t one definition for money management that suits all. Money management may begin primarily with investment agencies and banks; it is however also for you and me, and even for school kids. It is a concept that covers all and every. As long as we are living and earning money, be the amount in shreds or lots, managing money becomes more than just necessary.
On a broader note, the financial institutions, investment agencies and banks work as money management agencies. They aim at managing your money, and rightly so. You segregate your money in these various organizations, in order to keep a track. But does it suffice? If experiencing is believing, ask those who have been hit by recession; and you will realize how badly important it is to manage all your money.
Money management is plain and simple. On a general and most common notes, it means deciding which bank/ institution/ organization is worthy of managing your money. The entrepreneurs must know this, but if you are a beginner in a new business or job, you must know how to organize your bank accounts, how to manage bill payment books, how to maintain balance sheets, etc. If you are too bad at mathematics, don’t hesitate in hiring an accountant. It’s as important as ever!
If looked upon broadly, money management includes:-
Maintaining an emergency fund
Saving for retirement
Maintaining a budget is one of those scary money management stepss that many of us take refuge in procrastinating. However, it’s not supposed to be as scary as it seems! Do it the right way, and it is as easy as a pie. If you are a novice at it, catch some online budget software and/or online budget making tips that are specially designed to help newbies in maintaining a simple and easy to follow budget, as per their financial plans. The online money management softwares are also a good help in this regard.
We all know how important it is to Save Money. But one thing I would like to add- you don’t really have to “find” money to save, as most of us do. You simply need to save it. Where there’s a will, there’s a way!
We all recognize the importance of maintaining an emergency account fund, and for that purpose, many of us create different accounts and save money for a cause. But as the title of my article suggests, it’s all about doing it the right way. When you are saving money for emergency purposes, more than ‘a saving’, you get ‘a peace of mind’. You can even take help of the online money management softwares that are a great help in managing money.
It’s never too late to save money for retirement. Even if you are 60 already, consider saving money for retirementN as an investment when you would be 80+. So in that case, it would still be a good practice to start saving money for next 20 years in advance.
These were few tips for beginners in money management. Remember, it’s not the question of practicing money management or not- we all do that in some ways or the other. It’s about doing it the right way!