When you have a family including children & parents on the top of your head, earning income to save and invest becomes a derivative. However, through the way of this article we will recommend the best ways to save and invest within limited resources. Know more about them as shown below:
Most certainly, it’s the best thing to look after your aged parents like they took care in your young days. Amidst taking care of children and parents, we lose control over finances and build a debt mountain. And then this becomes a recurring event. So, you can follow 5 simple rules to keep yourself secure and take care of financial management. The easy rules to manage finances and also keep everyone happy can be found under:
- Work on a doable budget
When you see a likely chance for the budget to go out of cash, then its best to optimize your budget. The budget will totally be dependent on your income bracket, way of living and existing liabilities. As a beginner’s guide, we will explain the process to create a budget.
- Mode of budgeting
Firstly, decide on how to work on a budget. Whether its manual or electronic, a budget can be comfortably created as a reference point. Under a manual system, every calculation is manually done, taking into account the earnings and expenses together. To the contrast is an online tool to calculate incomes and expenditures automatically. An online software can also be downloaded to expedite calculations, whether free or paid.
- Creating a budget
The baby step towards building a budget is to have your financial objectives finalized. Till the time you’ve not ticked your goals right, it’s extremely difficult to proceed with savings. Pen down your short term and long term plans properly. This will substantially help to secure money when you urgently need it. Apportion cash for every important need so that every goal is fully covered.
- Follow the fixed budget
The most challenging part is to keep to stick to the allocated budget. Once you have your budget in place ensure you stick to it come what may. Don’t divert your income to other categories unnecessarily. Keep track of your bank records to understand what’s going out and what’s coming in. This is an effective way to keep your spending under control. Develop a habit to save first and then spend.
- Utilize your tax exemptions
If you have children, then your child’s education can be exempted from taxation. This is similar to the education loan which will be easily used as an exemption. You can also resort to investments for your parents. Infact a health insurance in your parents’ name will be counted too. This will be a double edged sword. Not only will you have deductions but also save your spending on health issues. You can also claim House Rent Allowance, whether living on rent or in your parents’ abode.
Typically, in a large family set up, small give & take is not accounted for. So, its superbly important to sit back and discuss the money matters for actual position. If things look to be in sync, then expect a good future plan for financial management & investment.