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Personal_Finance

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					Personal Finance

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529

Summary:
We are living in a society of consumerism. Prices skyrocket, demands
multiply; the only thing that remains static is your income. How to
survive in a consumer society keeping a control of the expenses?

Personal finance is all about planning your finance. You need to keep a
budget in every step of your life. Start from the household budget and
categorize the household expenses as follows.

-     Fixed expenses – These are monthly bills to be paid such as rent,
telephone, cab...


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Article Body:
We are living in a society of consumerism. Prices skyrocket, demands
multiply; the only thing that remains static is your income. How to
survive in a consumer society keeping a control of the expenses?

Personal finance is all about planning your finance. You need to keep a
budget in every step of your life. Start from the household budget and
categorize the household expenses as follows.

-     Fixed expenses – These are monthly bills to be paid such as rent,
telephone, cable, electricity, etc.
-     Variable expenses – These include the cost of all essentials
including your food, medicine, entertainment expenses, etc., and may vary
slightly depending on the items purchased.

The extra cash that you have after deducting the expenses for the above
determines your true financial status. If your extra cash is zero, or if
it is negative, you have to seriously think about reworking your personal
finance plans or consult a financial adviser.

What if you have loans and debts to be paid off? Most of the people have
mortgage payments, auto loans, credit card payments and other types of
loans recurring every month.

The best possible way to balance these is to maintain a decent debt-to-
income ratio. Always make sure that your debt-to-income ratio is never
higher than 50%. If you are overloaded with too many loans, consolidation
of the heavier loans will be a better option than keeping a bad record of
the debts.
Refinancing your mortgage is chosen as the best option by many debtors to
consolidate their debts. The only thing you need to be careful while
refinancing is to get a better deal, in terms of the market value of your
property and also the best interest rates. Higher the market value of the
property, higher is the loan amount. With lower interest rates and longer
mortgage period, your monthly payments will be reduced considerably,
relieving you from your debt worries.

Possessing a credit card is another way to keep your finance move without
worries. You can handle the day-to-day expenses without looking into your
pocket always. But make a habit to pay off the balance at the end of the
month. You can opt for credit cards that offer lower interest rates so
that you can bear a certain debit in times of crisis.

Insurance is another important rider in personal finance. Possessing a
personal insurance, home insurance, and auto insurance are the smart ways
of dealing with the hurdles that may jump on your way. It is also a good
investment option and a beneficial tool to secure your life and property
from the unexpected disasters.

Once you take care of your loans and emergencies, the next step is to
think about the investment options. There are many investment plans that
ensure huge returns irrespective of the market fluctuations. There are
long-term and short-term deposits offered by different banks and credit
unions. One of the safest ways of saving money is to invest in money
market accounts (MMA). MMAs offer a greater interest rates and also
insurance for your deposit.

To overcome the rainy days of your life, you need to keep a good control
on your finance, whatever may your present status be.

				
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