My response to the @Indiaunited Contest - Theme: How do you manage your income?
Managing income I believe is a difficult task. No matter how much ever you earn you will always have expenses standing against it. If you are a salaried person and as your income rises, you will see that expenses also will rise simultaneously, and if you are into business, you will always have something to keep investing money in. At one point of time in life, I was always running short of money and then to meet my expenses I had to use credit card, also take loans sometimes for big expenses, and my finances were in mess.
It was a worrisome situation, so then I made a firm decision to effectively manage my finance, and I started making a note of every expense of the month against my income, for a full one year I did that, I gradually started to fit in my expenses against the income with this practice. After a year, I had a fair idea of all the expenses that would come up in a year's time, then I could decide which were the expenses where I could make some cuts and increase my savings. I got a good idea of where I was spending recklessly. Most of the expenses are fixed on monthly basis, then I had to keep some margin for ad-hoc expenses and to cover up for holiday travels, festivals, birthdays, gifts and other celebration expenses. With the structure, everything fell in place, and it started getting smooth.
Over the years now, I have developed the habit of saving first and then spending the balance. So I save up some % of income as soon as I get and then the balance I fit into my expenses. My dreams are also big, so to meet that strict discipline is required. No matter how much ever I like something, if it's not budgeted in my expense, I will not buy it, which previously was not the case. Previously if I would go shopping I would buy everything I would like. Now, I got with a budget and spend only that much or less then that.
The other habit I developed is that while preparing my monthly budget, I always add up 5% extra to that expense, because sometimes it can go a over what I planned, so just to cover that up. Most of the times I am in my budget and that allows me to save these little 5% add on over every expense. Which then goes in the savings kitty of ad-hoc expenses.
This is my way of managing my income. That's for sure that if you have a fixed income you need lot of discipline to manage it.
Thank you for visiting my blog. 👼🏻👼🏻💖💖🌹🌺🌸
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