- Set financial goals
It is useless to have the knowledge about what and how to do if you do not know where you want to go. The definition of financial objectives allows you to transform dreams into monetary values, where it is possible to know how much is left to reach each objective.
To learn more about this tip, I recommend reading the article “Define financial goals”.
- Work out your budget
Budgeting is generally done in three steps: (1) Identify how you are currently spending your money; (2) Assess your current spending and set spending targets that take into account your long-term financial goals; and (3) Monitor your future expenses closely to ensure that they are on schedule.
To learn more, read the article “Prepare your budget“.
- Control your debts
Keeping debts under control is essential to the success of your planning.
It is important to be aware that there are good debts (home financing, for example) and bad debts (debts with a credit card or overdraft), and it is necessary to get rid of the bad ones as soon as possible.
Also, start by paying off debts with higher interest rates.
For more details, read the article “Control your debts”.
- Make an emergency reservation
As we do not know what lies ahead tomorrow, it is necessary to be prepared for any unforeseen events that may happen.
The objective of setting up an emergency fund is precisely to prepare for financial emergencies, such as a health problem, car and home repairs or even job loss.
It is important to have financial peace of mind at times like these and an emergency fund guarantees this.
To learn more, I suggest reading the article “The importance of an emergency fund”.
- Invest in financial education
It is sad to note that there are so many people willing to hand over much of their assets “with their eyes closed” to the bank manager to manage it, often investing in capitalization bonds or private pensions with high management fees, but do not invest 50 reais to buy a good book or 200 reais to take a financial education course.
Worse, they still think that the amount paid for the book and / or the course is an expense, not an investment.
I can guarantee that the investment in your education is – without a doubt – the most profitable there is. Before learning how to invest your money, it is essential to have a solid foundation and financial education to know how to deal with money.