Witty Mind Tricks and Guide to Using Your Money Wisely

It's almost the end of another year. How are your personal finances faring? Do you find yourself wishing you have saved more money? With the inflation of the cost of essentials and expenses, don't you wish your employer offers a higher paycheck, or better--a month's worth of income as a bonus? While we can continue to dream about free money, the secret of managing money is not about how much your income is, but how you manage your money.

Want a foolproof way to know where your money is going? Check out this guide on how to spend and save money wisely.

Money Management

Before we dive into how we can manage your money, it pays to define first the term money management. According to Investopedia.com, money management refers to the act of budgeting, investing, and overseeing the capital usage of an individual or group. Simply put, it is the act of financial planning your personal finance.

There can be two main actions on how to manage your money. They are:

1. Saving Money - the act of conserving your money and making enough money stay in your account for as long as possible
2. Spending Money - the act of paying for services, property, debts, and other products you need

Tips on How to Save Money

Saving money is easier said than done, others may think. However, saving for your future shouldn't just be short-term. You can start with a small value. To create and grow the ability to save money, check out these tips you can try on your own!

1. Open a savings account.
   To start, start putting in extra money, even coins in a piggy bank before opening an actual bank account. For starters, why don't you try out the 5-peso challenge? Then, after some time, open a savings account.

2. Set financial goals.
   Ask yourself, why do you want to save money? Whether you want to achieve financial independence or retire comfortably at the age of thirty years old, then it is important to define and write your financial goals. You must also evaluate your purchases, does it follow your savings goal?

3. Set aside for an Emergency fund.
   If you will ask any finance expert, one of the things they will advise you to start your financial freedom journey is to set aside funds for emergencies. By nature, we cannot expect when emergencies will occur, hence, it pays if you have a clear idea of where will you get that much-needed provision. So go ahead, and don't hesitate to open an emergency savings account.

4. Do not make big purchases unless absolutely needed.
   Unless it is part of your basic necessities, avoid spending money on leisure and impulse buys. Examples of such are buying gadgets such as a cell phone, the next car, entertainment, and shopping for clothing, to name a few. Also, be mindful of your household expenses by learning how to save money on groceries.

5. Track your personal finances.
   Have you ever experienced noticing that you keep paying recurring charges on your credit card, that you're not familiar with? Hence, it pays to always review your credit card and check your credit report and bank statements. Likewise, it is also the same with your receipts, even if you pay by cash. Watch out for recurring charges, and check every each transaction you make.

6. Set a monthly budget.
   Be concerned with and list all your expenses, so you start figuring out how much you should allocate for specific items each month. For example, you can allot thousands of pesos for your retirement, and groceries, and even split a portion of your income for your travel plan. What's important is once you form a budget, you must commit and learn to the said budget.

7. Improve your Credit Score.
   How do you improve your credit score? One way is when you pay your debts regularly, pay bills on time, and maintain your savings account active.

8. Research ways to increase your wealth in the long run.

Don't stop with just tips on how you can save on what money you have at the moment. One good tip you can remember after reading this article is to never stop looking for opportunities to grow your wealth. But also a word of caution, don't sacrifice your health for the sake of getting more wealth.

Tips on How to Spend Money

Money management doesn't mean you will be unable to buy things. Let's face it, even if we're struggling with money, we all deserve a reward for focusing on our finances. Hence, before you begin buying, you must first develop the habit of mindful spending money.

1. Pay yourself first.

While you have obligations to your family, a relative, friends, and monthly expenses to take care of, the last thing you shouldn't forget is to pay yourself. No matter how much money you earn, if you can't see progress with your goals, then you will not be motivated to continue.

2. Pay bills promptly.

With finances, you're in a good place if you are able to pay for your expenses on time. It also pays to record your payments so solicitors will notice that you can afford payments without having to incur penalties.

3. Organize monthly expenses and other living expenses.

When you form a budget as a way to save money, the counterpart is to organize your expenses so you can determine which items you need to pay. This also serves as a technique to avoid overspending.

4. Open investment accounts.
How do you grow your wealth? The first step in action you must identify which investment tools you want to use as a stepping stone for your success. You can start with mutual funds, stocks, and even property investments such as a house and lot in the Philippines. What's important is you understand, and focus on your chosen investment with the best interest rates so your effort will not be wasted.

5. Pay your debt.
This is among the most neglected tips of your financial journey. One of the good financial decisions you can make is to finish and pay your debt or loans. No matter how much you invested or how less you spend on an expense, if you don't pay off your debts, then that's a sign that you still have a long way to go in your financial freedom journey.

6. Choose a reasonable mortgage at a lower rate.

If you want direct action to boost your money management, you can decide to live in a house with a reasonable mortgage so you don't have to worry about paying too much rent and struggle too much trying to solve an aspect of your financial problems.

7. Use your credit cards wisely.

While using your credit cards to buy anytime is really tempting, remind yourself to use them for the essentials or even for emergencies only.

8. Invest in training and improving your skill to increase your income.

Earlier, our advice was to research how to grow your income. But after careful research, it's time to spend so you can grow your money. This is a form of investment you will never regret paying for. Before you risk putting your hard-earned money into investment schemes, you must familiarize the process first, so your money will not be wasted.

Real Estate: An effective and worthy investment

Congratulations on making it here at the end of the article! It just shows your enthusiasm and willingness to control your and your family's future. With all investment methods available, consider getting an affordable house and lot in the Philippines. Not only will it serve as a tangible item you can see as the fruit of your strict money management, but you can also pay it forward to your children so they will now have a forever home.

Eager to learn more about the advantages of owning real estate? Let Lumina Homes help you with that! You can check with people who can grow, build, and help you to figure out your priority, especially in terms of contributions, payments, and payments. As your partners, we can support and supply an answer to the best of our expertise. Ready to start practicing saving your money as you spend it wisely? Contact a Lumina Homes accredited seller today!