That one thousand two hundred dollars then can be saved, and put into a cd where it will gain interest. Think about big purchases for a while, don’t just by a big appliance because it is, a nice color make sure it has an important use. If it is something that is going to be used on daily basis like a car, or a microwave don’t justify the cost because it’s going to be used everyday it is always a possibility to talk down the price. Buying older items is another way to save. Being able to know where money is being spent is only part of the battle of money management. Knowing and being prepared for when the next bill arrives. Paying bills on time will help save a lot of money in the long run. When someone doesn’t pay their credit card bills on time interest will be charged (Interest is money paid regularly at a particular rate for the use of money lent, or for delaying the repayment of a debt).
Staying organized will help to pay a bill, but how is someone to pay a bill that they can’t find or remember about? It is also wise to set specific dates to pay bills so it is easier to remember to pay off every month. Automatic payments are also an option there is no worry when it comes to paying your bill. A money transfer on a predetermined time to pay a recurring bill. There are a lot of companies require automatic payments like Hulu, Netflix, or YouTube Red some companies do not require it, but it as an option. Starting an emergency fund is a very good idea because their is no way in life someone is going to know when their is going to be an emergency. An emergency fund is something that someone should take a little out of their paycheck a month and set it aside for when an emergency does rise up. Another bit of money that can be put into an emergency fund are taxes we receive at the end of the year after doing that a few times it can really add up and, also any change someone might accumulate from spending cash . Getting another job could also help in this area.Everyone wants to retire right. The only way someone can retire though is by having money set aside for later.
The only way someone can really set aside a bunch of money is by being out of debt. If someone is making car payment, house payments, or is in huge credit card debt that makes the possibility of retiring a lot harder but, if someone isn’t in debt it makes retirement more possible. By being able to pay off all debt it makes it easier to save money. Imagine not having to pay for another house payment how much money is that. Know imaging the money saved in a bank account how does that look. In the U.S the average home loan is two hundred twenty two thousand two hundred sixty one dollars.
With a thirty year mortgage at four percent leads to a one thousand sixty one dollar payment a month. What that means is if someone were to save that for a year they would have saved twelve thousand seven hundred thirty two dollars in a year in ten years they would have saved a hundred twenty seven thousand three hundred twenty dollars. Investing is a good way to make money and lose it at the same time. This isn’t necessarily required to gain money management skills, but it never hurts to elaborate on this topic. The best way to start out investing is by investing in a mutual fund and keeping it in there for a few years. After a few years of doing that hopefully that money grew a little.
Then maybe move into riskier stocks. Only invest in stocks that he/she knows about and do a little research about it see how much the company is worth the average dividend and, see how much debt the company is in. Do not start buying stock that is outrageously high and because it is a big corporation start out by investing in a small company that has very little debt and stock price is very low so in the future the stock will be able to sell for more if he/she wants to get rid of it. Because the stock that someone bought and is not doing very well does not mean the stock should be sold. The stock market fluctuates on a daily basis on minute they can be doing very well the next minute the stock is getting a negative return.