Getting Started : Knowing Your Committment
Before you go out and invest all your
money in unit trusts, you need to remember that you still have that stack of
unpaid bills sitting on your coffee table.
Unless you are very rich, chances are that you
will have to plan how to spend that salary of yours each month. This means budgeting
for your food, lodging, loan payments, kids tuition fees, your 4D tickets and
Only after you have fulfilled all these commitments
would you know how much you can afford to invest each month.
If the amount left over after paying off all
your bills is too little, then you have to adjust your monthly budget accordingly
so as to reach your investment goals.
Making and sticking to a budget is the most realistic
way of ensuring that your money gets spent in the way that you want it to.
There are a variety of popular electronic tools,
like Microsoft Money, that you can make use of to plan your budgets. Or you
can simply use fundsupermart's Budget Calculator
to help you plan.
Sticking to it
The hardest and most painful part about making
a budget is sticking to that budget. If you think "I'll make up for this
month's excess by spending a bit lesser next month", you're in trouble.
You know that seldom is the extra amount spent this month made up the next month.
Its just commonly forgotten and absorbed under "where did it all go?".
So how do you stick to your budget? Well, the
most efficient and proven method is to set yourself Goals. With a pre-determined
goal, you would be more motivated to sticking to your budget. There is now a
consequence to not sticking to your budget -- you don't achieve your goals.
To find out more on setting your goals, proceed
to our next class.
Next : Setting your goals