My learnings in managing personal finance

I have been reading a lot about making money on the internet. How there are millions of dollars on the internet waiting to be picked up etc. This set me off on a train of thought and reminiscing about my past life and how I handled finances, loans etc.

Let us come to the point. As of now I have never taken any major long term loans, so in that effect I could say I have never been in debt. My first and only car was on loan and has been paid off several years ago. The time I was paying for the car was perhaps one of the most financially trying phases. Not because I was paying too much, but because during the initial months I was not doing effective Debt Management. When payments got delayed, I lost my peace of mind. This led to a frayed temper and I would be jumpy. One day I sat down and decided that from now on I would manage my finances better and include Debt Management as my routine monthly budgeting.

One of the most effective ways of Debt Management in my opinion is to make a table of money you earn and payments you have to make. And then deduct the payments from earnings to know how much you will be left with to spend and if you will have enough or have to dig into your credit card to sail through the month. If you can sit down and draw up a table defined above, you have taken the first step towards effective Debt Management.

The next step would be to map your daily expenses. Make another table with a minimum of four columns: date; particulars; amount spent and mode (cash, credit card, check etc). Now you have to have the discipline to sit down at the end of each day and write how much money you spent and on what. This will help you keep a tab on your expenses and see where you are spending too much and how you can curtail unnecessary expenses. Once this is done it is easy to manage your finances and arrive at effective strategies of Debt Management.

These are steps to avoid getting trapped in debt. But if you are already deeply entrapped, the strategies would be different. There are several organisations out there to help you to get out of debt and help you in your Debt Management systems. Get in touch with them consolidate your debt and follow a disciplined approach to Debt Management and I am sure you will soon get out of all debt.