Skip to content
Below is the five-step plan:
- Comprehend your cash flow. Your ability to understand your household cash flow will affect your financial future most. You need to understand how you spend money currently if you want to save for the future or even spend at the moment. Take a look at your weekly expenditure. This takes less time than the monthly review. You will be able to discover the places you spent more than you had planned. If you have overspent in the previous week, you’ll find it easy to live a lean for a week. But if you have been overspending for a month, you’ll find it harder to catch up.
- Learn to say “no” by not thinking twice on your “yes.” You should be clear about you want to undertake in the short-term and the long-term, by doing so it will be easier for you to make spending decisions that you’ll be happy about when you look at.
- You can limit your monthly bills. You should limit your current and future spending choices. In his first step cash management system, Eric Kies talks about money past, present, and future. The amount of money you’ve decided to spend at the beginning of the month is known as money past. These include things like rent, utilities, and student loan payment. There are limitations that can occur in your daily spending (money present). These are things like getting a loan to buy a car. This can also interfere drastically with your money future.
- Automatically save for the present and future goals. When paid directly you find it easy to direct funds into multiple accounts. Those who have multiple savings accounts have their balances grow to realize a certain specific goal. This also allows you to see the progress that you’re making.
- Plan for spontaneity. This is very important although it might sound contradictory. Quite a number of people find it hard to track their spending because they feel constrained. Building money that is purely for spontaneous spending is the only solution to this. If you have budgeted to spend money, you’ll protect the others that you have saved.