5 easy ways to manage your monthly budget

Budget

As your life progresses, you will find new responsiblities, new expenses, and financial matters failling on your way. Budgeting is the first, simplest and most important step towards efficiently handling your money. Here are 5 smart tips to maintain your montly budget.

Deduct Insurance and retirement costs

Insurance is a part of your contingency plan while retirement is an inevitable stage of life. Both need little monthly contributions out of your income. Thus, the income you can plan your present and future on should be counted only after you have deducted retirement goal contribution.

Pay yourself and family

The amount remaining after retirement and insurance protection is the amount of income you earn for running everything else in your life.

Allocate to long term goals

The remaining amount is your money towards your and your familys long term financial goals. You should be able to save and invest 30 to 40 percent of your total income towards your long term goals.

Allocate to short term goals

You not only have to save for your long term goals but also your short-term requirements. Yo invest in the short-term saving schemes for going on a vacation, buying a car, etc.

Record and watch for mismatch

Plans are never perfect. The purpose for a plan is to provite a direction to your thoughts and actions. So is your budget. It serves as a refernce point for your financial actions.