5 Quirky Money-Saving Techniques for Better Personal Finance Management

Managing personal finance can be a real struggle for most people. For some individuals, they realize the importance of saving money only when the emergency situations arise. By that time, it will already too late and they will end up taking out loans or maxing out their credit cards.

Don't be most people. Make it a habit to save a part of your income to be sure that you have something you can use when the right time comes. Check out these money-saving ideas you can try today.

1.      Pay yourself first with the 10% rule.

One of the greatest mistakes that people commit in personal finance management is to spend their money first and put the remaining balance, if any, as savings. That shouldn't be the case! You should set aside at least 10% of your paycheck first and use the remaining amount for your needs. You deserve to pay yourself for the hard work you did.

2.      Automatically transfer money for savings before you see them.

If the bank of your payroll account permits, set an automatic transfer to another personal account where your savings are. Consider setting the schedule of the transfer a day right after the payday to avoid spending the money meant for your savings. In this way, you'll be forced to save a portion of your paycheck. It's going to be tough, but at least you know you have financial cushion in case of emergency.

3.      Make it a habit to have savings equivalent to your 3-month's worth of income at any given time.

As much as possible, consider maintaining savings of at least thrice your monthly income. In fact, financial gurus suggest at least 6 months. In this way, you can be sure that you still have the financial stability to sustain your current lifestyle without making major adjustments just in case something bad happens to your company or in case you lose your job.

4.      Create budget and actual expense reports as if you'll present them to someone.

This is one of the most essential budgeting tips since you will actually be able to manage your personal finance much better when you have a visual representation of where your money goes. Every before the month ends, make it a habit to create a budget plan by listing your expected income for the next month and your potential expenses especially the important ones such as rent, utilities, daily transportation and food. In this way, you have a clearer idea of whether or not you can afford to spend for a little bit of luxury for yourself like a dinner in your favorite restaurant or a brand new pair of shoes.

As the days go by, make sure to list down whatever expenses you incur so that you can keep track of how much money is left and stick to your budget. With these reports, you will be able to analyze your spending habits at the end of the month and determine if there are expenses that should be cut down. If you prefer, you can even create a pie chart to get a glance of what's eating a big chunk of your finances and take action on reducing your expenses on that matter.

5.      Assess your lifestyle and eliminate habits that may drain your finances.

Make a quick assessment of your lifestyle (or a thorough one if you have your monthly personal finance reports) and see if there are unnecessary spending habits that have to be reduced, if not eliminated. These include your purchases of cigarettes and alcoholic beverages as well as your constant visits to fancy restaurants, movie houses and related establishments. Expenses on these matters may be small each time you incur them, but when accumulated over the month, you'll see that they actually sum up to a large amount.

If quitting these habits altogether is hard, you can create a plan to slowly reduce your expenses through several weeks and even months. For example, if you smoke thrice a day, consider forcing yourself to do it twice a day next week and once a day in the week after that. Continue doing this until you won't have the need to smoke or at the very least, you'll smoke once a week.