Are you where you want to be with your personal finances? Do you know what your net worth is? Do you have any idea whether you have a positive or negative monthly cash flow? If you answered “no” to any of these questions this article is going to help you better manage your money to get where you want to be!
Your financial plan will help you make the best financial choices, so you can set yourself up to win financially by really managing your money.
A good budget will prepare to make each financial step as it comes. You should have a monthly and annual budget to make this work effectively.
It does not matter how much money you make, you can always spend more than you earn. A budget is your best tool for taking control of your finances. It is the key to helping you change your financial future.
Calculate Your Net Worth
Many people believe that calculating your net worth is difficult. In actuality, it’s probably the simplest step in starting or learning to manage your finances. To calculate your net worth subtract your total debt from your total assets (Assets – Debt = Net Worth).
Build an Emergency Fund
Once you are out of debt you should build an emergency fund of six months’ worth of expenses that you leave in the bank. This cushion will allow you to leave your investments alone in case you fall on hard times. It should only be used for real emergencies such as a job loss, and it is set up to protect your investments and retirement savings.
Calculate Your Overall Cash Flow
Your overall cash flow is probably the most useful tool in your efforts to manage your finances because it gives you a constant checkpoint to see how effective your various financial strategies are. As your income goes up and expenses go down, this calculation will show you concrete proof that you’re moving in the right direction.
Invest and Diversify
Once you max out your eligibility on your retirement accounts you can use other tools such as mutual funds, annuities, or real estate to increase your investment portfolio. It is important to diversify your types of investments.
Get a Hold of Your Credit Scores and Reports
The next step in organizing your personal finance is getting a hold of your credit score. Our company which is “DKR Group” offers a FREE Credit Analysis you can learn more about what we can offer, in this post.
Your credit score is extremely important in getting the very best rates on loans. Having a good credit score can literally save you hundreds of thousands of dollars over your lifetime. Think of your credit score as an insurance policy to lenders.
Save for the Future
After you have done that you should work toward building your retirement and investing savings. In addition to saving for retirement, you should begin to plan and save for future expenses like your child’s education or a down payment for a home if you have not yet purchased one. You may be thinking about a dream vacation home in the future or retiring earlier than normal. All of these take a different saving and investing strategy than typical retirement savings. However, it is an important part of your overall financial plan.
Stay tuned! We will be doing a WOMAN Empowerment this coming 2020.
DKR GROUP LLC
www.dkrgroupfinancial.com or call us 770-578-4165.