Finance Essay

967 WordsNov 23, 20134 Pages
How do you become financially sound? Just like any goal or dream you set for yourself, managing your finances and becoming financially successful requires discipline and determination. Personally, I’ve recently been looking to eliminate debt, increase my savings and increase financial security for myself for the time to come. I’ll explain more in depth about responsibility, discipline & financial literacy. Your top priority should be creating an emergency fund. Following creating an emergency fund, first involves self-discipline. Start by making it the first bill you pay each pay period, by having a set amount ready to be set aside. Don’t even think about this transaction — just make sure it happens, each and every pay period. Think about the goals you want to accomplish and what you need to do to get there. Telling yourself you can do it; along with taking the necessary steps to follow through is the first step to reassuring yourself that you can responsibly manage your money. Control your frivolous spending. Frivolous spending, on eating out, shopping and online purchases, is a big drain when it comes to finances, the biggest budget breaker for many, and a sure way to be in financial impasses. Research shows that people who try “The Envelope System” save a substantial amount of income each month. This is a simple easy system to keep track of how much money you have for spending. Start out by setting aside amounts in your budget each pay period — one for gas, groceries, eating out, etc. Withdraw those amounts on payday, and put them in separate envelopes. You can easily track how much you have for each of these expenses, and when you run out of money, you know it immediately. You don’t overspend in the categories you make. If you regularly run out too fast, you may need to rethink your budget. Again, this is where self-discipline, motivation, &

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