posted by beaconboy @ 3:53pm, Thursday 13 February 2014.
The term personal finance can encompass anything to to with an individual's financial dealings, budget, income, expenses, investments, insurance and assets.
It should be also emphasized that a plan should be in place for each individual or family that dictates how they react to financial situations. People make the mistake of overlooking their personal finances in that they don't realize that they are dealing with a dynamic, ongoing process that will affect their lives.
If personal finance is tamed and under control, the resulting experience can be a satisfying and profitable one. If, however, it gets out of control, it can become a lifetime of frustration and mayhem, which will own the person and create a devastating experience which will create endless confusion and frustration.
The first step that anyone should take is to make a budget. This is not hard to do, it just takes some time. Take out your check book and go back three months and make a list of all of your expenses. List the names each company or person that you pay money to each month, and then add all the totals, and those are your expenses each month.
You should set up a tax account, to set aside all of the taxes that you will owe at the end of the year. Even if you have taxes taken out of your paycheck, figure it out. You may still owe some local taxes, but if not, good.
Now list all of your sources of income, and compare the two. If your expenses are more than your income, you need to cut some expenses, or find some extra income, or both.
Keep track of this each month. Starting out, you might want to do this on a weekly basis.
Set up so much per month to put into savings, and do this religiously. If you work with this, and pay attention to it, it will set you up for the rest of your life, because not you are controlling your personal finances, instead of your personal finances controlling you.