In the hustle bustle of everyday life, for a career orient individual, it often becomes a challenge to manage personal finance. A total financial autonomy can never be achieved. However, some helpful tips can assist you in handling the personal finances and making the ends meet easily. If you are planning to accomplish your money goals, here are some tips for your action plan:

1. Calculate your net worth

The first thing you should be doing is to calculate your bottom line. For this purpose, you have to collect all your bank statements, bills and other expenses and make a summary. Also use the values of your current belongings such as your car, house, and others. Subtract your liabilities from your assets and determine your net worth. For this purpose, you can also use various financial software available online.

2. Make a budget of expenses for your home

To meet your financial goals, set up your monthly spending limit. Then devise a budget based on the division of each expense in a monthly planner. You have to be realistic while creating this budget and only add actual prices of the things. If you create an unrealistically low budget, you end up giving up on it.

To accurately add things in your monthly planner, for a month track every expenditure in a notebook. This includes both your incoming and outgoing transactions. Once the month is completed, summarize your incoming and outgoing money. There are much online software that can help you with creating a budget based on your spending habits. Give yourself two chances to tweak the budget on every 15th and 30th to keep it more realistic for days to come.

3. Do savings for the retirement

Regardless of your organization’s retirement policy, create one for yourself. Mark a percentage of your salary to your retirement fund. With increments, do not decrease the ratio of your retirement savings. Keep these savings in a separate bank account.

4. Save for emergencies

Uncalled of expenses knock at your door at any point in your life. For situations like these, be prepared beforehand. Mark one percent of your income for your emergency fund. This can be as minimal as 5% to 10%. According to a survey, one person faces one emergency expense every six months. So with a ratio of 5% to 10 %, you can save a considerable amount for a rainy day. 

5. Say no to debts

It’s okay if you took a loan in college to complete your education. But the day you step in your professional life, say goodbye to debts. If you use a credit card, make sure you save for it the entire month and pay before the markup for it escalates. In case of an emergency, use your saved funds or retirement funds instead of opting for a debt.

6. Go for insurance policies

Although insurance is a complex bridge between you and the insurance company but having only you can rely on during an emergency is a must. In order or significance, you should get the following insurance policies to live a financially independent life:

1. Health insurance
2. Home insurance
3. Car insurance
4. Life insurance