All of us need money to make our ends meet. There are times when you run into debt before the month-end because the cash outflow has been more than the cash inflow. If such a debt problem is happening to you almost every month, then it becomes important for you to understand why you are running in debt every month and where is all your hard-earned money going. In this blog, we write about how not to run into debt.
1. Necessities Budget
Take a note of your monthly necessities, such as paying off for rental or mortgage, buying food, recharging your cellphone, etc., and make sure to set such an amount aside. Making sure that your necessities are fully paid for is the objective for working so hard, so don’t get lured in by advertisements and waste your money. In this era, it’s time for you to get smart.
2. Development Budget
Now that your necessities have been secured, you should look around and see what areas of development you need to move higher up. If you feel stuck with your current pay scale, then it’s not your job, but you who needs to upgrade their skills. Therefore, you should always be on the lookout for new skills that you might require for moving higher up the ladder. Acquiring a new skill in the industry shall make you a more valuable resource. Setting aside a development budget is more like an investment in self. In this era, it’s time for you to skill up.
3. Investment Budget
Investments are good as they give you a certain return and appreciate your wealth. Creating wealth takes time but it is certainly not unachievable. There are several people out there who started investing with minimum amounts and have generated wealth today. It took some time but youngsters who started early have reaped the benefits of accumulated gains. In this era, it’s time for you to invest smartly.
4. Rainy-Day Budget
Nothing feels worse than the feeling of an empty pocket when you need the money you so carelessly spent away. A rainy-day budget is a minimum amount that you should set aside so that if you end up running dry before the month-end, you can tap into the rainy-day budget. Mind it, this rainy-day budget is only supposed to be spent on necessary purchases. In this era, it’s time for you to save smart.
Here’s a poem for you:
Hey, You! Hey, You!
Your money is hard-earned,
Why are You in a hurry to make it burn,
Invest smart and save smart,
Get smart and skill-up,
Don’t forget the rainy day,
To help You, WIOAI is on its way.
To conclude this blog, if you focus on setting these four basic budgets at the beginning of the month then the chances of you running into debt will be very low. You can also check out our earlier blog Ways of Travel Expense Management if you are planning for travelling. If you found this blog useful, do share it with your friends. Also, subscribe WIO AI if you haven’t yet and get WIOCOINs.