5 tips to improve personal finances in the world of consumerism

We live in an age where marketing is winning to reason and consumerism is taking over all members of the family, as we can not restrain ourselves to the spell of wanting to have items and accessories that are fashionable and a priority in the future of our lives, because sometimes we think it’s better to enjoy and live indebted to avoid the temptation to buy and save money for a better chance that it could make us difference in not very distant future.

Below mention the basics in which we pay special attention to improve our personal finances:

Compare income vs monthly expenses
A simple personal income statement will help us to realize how much is the limit we have to spend, as a basic rule in business as the personal aspect is knowing that we should not spend more than the revenues we generate, whether through a salary, fees or business and professional activity to which we belong.

Within the list of expenses must be divided into fixed costs, which are the ones that we have every month, such as telephone, electricity, water, school fees, cable TV system, maintenance, storage, fuel, public transportation, food, mortgage, monthly car, etc., and basically enter variable costs which are intended for entertainment and what we spend for clothes that are incidental expenses.

If our expenses are greater than income, it means that we are unable to maintain effective control of the money we receive and therefore we can not generate savings and worst of all is that we are indebted in some way, so we make downward adjustments in the way we spend.

Learn how to save
People is very used to live for today, because of the level of average income we have, but we are also poorly disciplined, because when we always have short wool we burn it rather than go saving little by little. For example every month can separate 10% of our income and open an investment account to start generated interests and those savings eventually become a car, apartment or hitch for our dream home.

Avoid using credit cards
If you can not use a credit card, better not use it, because you can go into debt very easily and quickly. Best used cash for your purchases and card to occupy it for emergencies or exceptional cases where it will not be another one that the use of the credit card. If it is possible to leave credit cards at home and take with you the necessary cash you’ll need for the day.

Prepares monthly cash flow
Prepare a monthly cash flow will help us to realize what we are spending our money, so in a book or a spreadsheet takes the daily record of the expenses that go taking and at the end of the month we’ll be realize that there are costs that are unnecessary and therefore we can make them aside to allocate money to questions of greatest need or personal savings.

Banks are not your friends
If you believe that a Bank can extract you of troubles to cover your debts and go to any of them, the only thing that you are doing is to make the debt bigger, because a bank will always paint things pink, because a bank will care little your particular situation and are very interested in what best suits them, for never clearly explained the real rate of interest you’ll pay over the term of the loan, so you have to be very careful with these institutions, because a bank will never come to your aid when the going gets rough.

When you’re in front of the item you wish to purchase, ask yourself if it really is essential and necessary for your economic conditions you have and not be it is better to leave it and buy it at a better time. They must have more tips to improve personal finances, but start with these 5 tips could be the difference in the future, then start being disciplined sometimes hard, especially when you change from one day to another, the change should be little by little, with patience, but when you take into account you will see that your financial possibilities will be different from today and can achieve many things and especially avoid unnecessary penalties that could actually damage to health.