There are many ways on how we can manage our income. Everyone has their own ways of managing their money. These are a few tips that I am currently trying to implement to improve my money management skills.
a) Save 10% of your monthly salary
Save at least 10% of your monthly salary, either in fixed deposit, to another bank account, or if you're in Malaysia, save them in ASB. Although 10% may not seem much, but you'll be surprised how much you can save in a year just by doing so. For example, if you're earning RM1500 per month, by saving 10% = RM150 x 12 months, you'll get RM1800 by the end of the year. If you save RM1800 in ASB, you'll probably get at least 10% dividend, which means by the end of next year, you'll get a total of RM1980 in your ASB account!
b) Pay off your utility bills
Once you get your salary, pay off all important bills, such as water and electricity bills. Allocated a certain amount for monthly home rental or payment, for petrol or public transportation, groceries, and credit card debts. Make it a habit to pay your bills on time, or else you'll need to pay more interests and also be fined for late payments.
c) Buy needs and not wants
Groceries and toiletries are needs. That expensive, branded perfume, that cute handbag and the latest game console are wants. If you went shopping one day and came across an item that you don't need but want, try to delay your purchase for at least a day. After a few days, chances are you might not want it as much as before. If you really want a particular item, save a little each month to buy it.
d) Keep track of your spendings
If you can help it, save by not purchasing anything when you go out. I always have lunch at home before going out for a movie. That way, I won't be hungry and I don't need to have lunch outside. Home-cooked food is definitely cheaper and it's healthier too! When spending for groceries, make a list and stick to your budget. Keep track of your spendings by keeping your receipts. By knowing what your money is spent for, you'll notice how much you waste on unnecessary things.
Remember, watch what you spend on and save! The number one tip to be a millionaire is by not spending! Happy saving. :)