Personal finance is a scary subject for some people because it
conjures up all sorts of personal fears about budgeting, managing
investments and buying Vs renting a home. Fear and anxiety are
common responses to the topic of personal finance regardless of
an individuals level of education or experience in other areas,
particularly business. As a result, many people avoid dealing
with their personal finance issues until they are almost at
crisis point and in serious credit or debt trouble.
But before you can make any decision about your personal finance
or take any action regarding your finances,wealth or lifestyle
you should obtain a firm understanding of your current financial
position. Surprisingly, many people have only a vague idea how
much income they actually bring in each month and then how much
they actually spend each month and whether there is a positive
difference between these amounts that are in you favor.
So the first thing to do is assess you financial situation.
Gather together all of the information and documents that will
give you a picture of your financial position. Tally your net
worth, including real estate, superannuation, monthly income and
all other assets. You may be pleasantly surprised by the total.
Then, set yourself up a budget by listing all of your expenses.
Be completely honest and dont leave anything out. If you cheat
on this you will only be cheating yourself. List everything
including luxury items such as take out, cosmetics, magazines and
While a budget is absolutely the first step to taking charge of
your personal finance, this is by no means the only step you will
need to take. You can investigate other services in the
marketplace, such as electronic bill pay, investment counseling
and seeking out hints and tips for financial health. Electronic
bill pay or BPay as it is more commonly known, is particularly
useful for people who tend to be disorganized or who
procrastinate on keeping their bill paying in order. You can even
arrange for your bills to arrive by e-mail rather than through
snail mail. You then pay them electronically, by direct
withdrawal from your bank account and the transaction gets
processed straight away.
Once you have assessed your budget and established a regular and
efficient bill paying mechanism, you might feel that you are then
brave enough to investigate other areas of personal finance such
as investments and stocks and shares. Once again, the Internet
can be an invaluable resource, allowing you to thoroughly explore
all of the different options and strategies available. You can
find all sorts of useful references about investments such as
term deposits, managed funds, purchasing stocks and shares and
participating in share clubs. You might like to start simple
though and merely open a short term savings deposit account so
that you can deposit from your pay check each week or month.
This way, in no time at all you will begin saving for your next
goal whether it be for a car, holiday or some minor surgery.
Steve Brown is the owner and webmaster of 21st Century Wealth,
a premier resource for wealth information, news and invaluable
wealth and lifestyle education. For more information, go to: