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Steps Of Maintaining Household Finances
Now, let us learn the steps to maintain household finances.
Household finances occupy one of the major portions of the gross expenses of an individual.
A well-maintained household finance strategy -
- Strengthens our budget; and
- Prevents us from running short of any household supplies at any point of time.
Let us know the steps to maintain household finances:
1. Ascertain expenses: Firstly ascertain the monthly expenses which will occur mandatorily. Keep that portion of income separately to avoid any financial crunch.
2. Emergency purchases: There may be certain emergency purchases in a month that may require you to keep certain funds separate. For example: you may plan to keep a separate first-aid box at home, for which you may require medicines, bandages etc. So keep that portion of funds separate from the income portion.
3. Reserve amount: The amount left after allocating to expenses and emergency purchases should be kept for other uses which may be -
- Seasonal expenditure;
- Irregular payments of any kinds; or
- Buying new clothes, etc.
4. Record of expenses: Always keep a record of expenses whether online or in pen and paper. This helps you to keep a track of the expenses done.It is advisable to prepare a statement of net worth to keep track of income & expenses. Let us learn this in our next unit.
