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Discover how to organize your personal finances in 9 practical tips. You still have an extra tip for your personal and professional life. Organization is a fundamental part of the success of any project or business, as you well know. Therefore, organizing your personal finances becomes essential for the success of your personal goals. Achieving business success will consequently generate much better-living conditions, with increased income, renown in the market, etc. But for everything to go well, you also need to pay attention to your own personal finances. This means that apart from investing your money to facilitate wealth creation, you also have to keep a check on your expenditure and the management of your income and investments. That’s because there is no point in making more money and continuing to have problems with endless debts and budget problems every month. It is the same as not knowing how to swim in the pool and wanting to venture into a lake. Knowing how to deal with your own money is fundamental to building a healthy and prosperous financial life.

The importance of having well-balanced personal finances

Let’s imagine that your company does not know how much it spends or how much it earns. Then it’s time to charge customers, but you don’t know the exact amount. Therefore, you are subject to two situations:
  • Charge more, and end up losing customers to competitors who have fairer prices.
  • Charge very cheap, and end up bankrupt the company for not making a profit with its products and services.
Both paths would lead to financial ruin, wouldn’t they? Well, with personal finances the rule is the same. You need to have control over your personal finances to have a healthy relationship with your money, living and spending within the means and avoiding unnecessary debt. In this way, you start to have a better quality of life, because without debt you can reserve part of your income to achieve financial goals and dreams. In addition, you have benefits such as:
  • Self-knowledge about your consumption habits
  • Stop living for money and start using it as a tool to achieve your goals
  • You are not caught off guard by unexpected situations, as you know exactly what to pay and when your debts are due.
  • Discover the most suitable investments for your investor standard.
With that in mind, we have listed for you 9 tips to improve your relationship with money and thus organize your personal finances in the best way.

9 steps to organize your personal finances today.

1 – Make a general diagnosis

The first step in organizing personal finances is to write down all of your income and expenses. Thus, you can identify whether the difference between entering and leaving is positive or negative. In the case of a negative result, it is a sign that your financial health is not doing well. This is where you should start to analyze which expenses are really necessary for your life and which ones you need to cut.

2 – Set a budget

After diagnosing your personal finances, it’s time to set your monthly budget. In this part, you will need to classify your spending into different categories, such as:
  • Fixed expenses: provision of house, car or school tuition for children. Fixed values ​​in general.
  • Variable expenses: energy, water and other bills that vary according to consumption or your needs.
It is important to define how your budget will be divided for each of these categories, for example: 50% for fixed expenses. You can also create goals to reduce variable spending by saving water, energy or phone. It is also important to assess your current standard of living and review spending on items such as the market and leisure, in order to reduce spending to fit your budget.

3 – Prioritize high-interest payments

If by chance you still don’t have all the money to pay off all debts, prioritize the payment of bills with the highest interest, such as Overdraft and Credit Card. The other accounts you can negotiate to reduce the installments while settling the accounts that cost you the most money in the medium and long term.

4 – Change your habits

In order for your personal finances to remain positive each month, you need to live within your budget. And for that to happen, some important adjustments may be necessary, as we saw in tip 2. Get together with the family and put the bills on the table. It is important that everyone knows about budgets and spending so that together they can adapt, organize finances and improve the financial health of the home. Exchanging paid programs (movies, restaurants and clubs) for activities like picnics, walks and fun menus at home can help you save temporarily.

5 – Schedule your purchases

Saving doesn’t need to be the same as giving up what you like best. In fact, it is now time to assess whether your consumption is really necessary or if it is pure impulse. So, before buying something, try to give voice to reason and not to emotion. Plan to buy that accessory, clothing or appliance. That way, you avoid unnecessarily getting into debt. In addition, when you have cash in hand, you have even greater bargaining power at the time of purchase.

6 – Beware of easy credit

The fact that you have easy credit does not mean that you should use it whenever you want. It is essential for your personal finances not to use credit cards, overdrafts as a supplement to your budget. These are the biggest pitfalls for your personal finances, and you should avoid them in order not to harm your financial health.

7 – Create an Emergency Reserve

With all the accounts organized and a well-defined budget, it’s time to think about the future. And one of the best ways to do this for your personal finances is to create an Emergency Reserve. To do this, you can start by reserving a percentage of your income every month, around 10%. This reserve will serve as a basis for unexpected expenses that arise, such as health, car problems and so on. You can save that money in a financial application that has good liquidity. This way, you will make your reservation pay off and you will be able to withdraw it easily whenever you need it.

8 – Invest in Financial Education

You, as a business owner or responsible for the main source of family income, need to have knowledge on topics such as interest, inflation, investments and consumer psychology. Therefore, it is important to seek financial education in courses or books on the subject. Knowing how to use your money properly is one of the main advantages of organizing personal finances.

9 – Have a tool to control your personal finances

As we saw above, controlling spending and knowing exactly where your money goes is critical to keeping your personal finances up to date and healthy. And to facilitate this task, you can and should use tools to help you with this control. In this context, the most common and recommended option for organizing your personal finances is the expense control spreadsheet. With the Excel program, you can assemble yours the way you see fit, and still have the features you need to calculate, generate spending averages, etc. But if you don’t have time or don’t know where to start setting up your personal finance chart, we have the solution. Check it out below.

EXTRA TIP – See the 3 best spreadsheets for personal finance from Adnia Solutions

Adnia Solutions is specialized in customizable, high-quality Excel spreadsheet templates. With them, you only need to store the data, so the spreadsheet itself organizes and shows you the highlights and main indicators, through graphs and complete reports. All with powerful designs that are easy to read and understand. And to organize personal finances, you can count on 3 models:

1  – Account Payable Dashboard Template

In the Accounts Payable Dashboard, you can better organize all your accounts in one place. Correctly monitor the progress of your accounts on a monthly basis, with actionable insights to correct flaws and tailor your actions. Some of the Account Payable indicators available in this spreadsheet template:
  • Payable Account
  • Overdue
  • % Overdue
  • Cash on Hand
  • Invoice by status (Open, Paid and Overdue)
  • Average Creditor Days
  • Account Payable Age

2 – Accounts Receivable Dashboard Template

Have an Accounts Receivable Panel to properly organize all accounts receivable indicators in one place. With this spreadsheet template, you can provide actionable insights to correct failures, and monitor the progress of each account on a monthly basis. Some of the Account Receivable indicators available in this spreadsheet template:
  • Receivable Account
  • Overdue
  • % Overdue
  • Cash on Hand
  • Invoice by status (Open, Paid and Overdue)
  • Average Creditor Days
  • Account Payable Age

3 – Accounts Receivable Management Template

To better manage your accounts receivable, this spreadsheet template is ideal. With it, you can organize all the data and track each invoice. Have full control over your budget each month by analyzing changes in financial indicators by receiving reminders of past due invoices that you have not yet received. Available reports:
  • Accounts Receivable Dashboard
  • Indicators History
  • Accounts Receivable Turnover
  • Summary Report by Customers
  • Invoices List
  • Overdue Invoices by Customers
Experience the impact that Adnia Solutions spreadsheets offer for your data and information management. We have solutions to help you organize your personal finances and also for several other areas that involve information management. It is worth taking a look! Also take the opportunity to follow more tips and Excel features, as well as content about business and projects, published on our Socia Media.