Personal finance in 2023

The beginning of the year is appropriate to set new goals in the areas of life. A very important element to include is our list of “new year goals” on the personal or family financial planning, Well, this will help us manage ourselves better during the next twelve months and be able to overcome, with greater success, any economic difficulties that may come our way.

The process of personal finance planning start with identify sources of income that we will have during the year, starting with the secure income as salarycontinuing with the less secure income, such as family transfers for remittances or gifts from third parties.

In the case of people who do not have a permanent job, but depend on the monthly generation, according to how they bill their clients, the most appropriate thing would be to take a average monthly income from previous years. Next, spending planning must be done.

In this case, equally We must start with the most important expenses and that they are monthly obligations, such as the payment for housing rent, fixed health expenses, cost of food, payments for the education of children, among others. The last expenses on our list should be those related to fun and recreation, since they are the easiest to adjust.

In both cases, both in the organization of income as well as in the estimation of expenses, it is important that we are completely honest and realistic with ourselves, because only then can we visualize the near future with greater certainty.

After the process of identifying income and expenses, it is time to compare them. By comparing the secure income (salary) with the most important expenses (fixed obligations), it is possible to see if the expenses are above the income, which is an indicator of future problems.

Then, You have to make the decision to reduce expenses in time, whether it’s moving to a home with a lower rental payment or changing eating habits, because even though they are difficult decisions, making them early would avoid major problems in the future.

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Another important goal is to increase income, It can be through a second job in the afternoon or looking for a greater number of clients, the key is to achieve economic income that allows you to find the balance between safe income and monthly obligations.

On the other hand, it is possible that some people have a fixed income greater than the monthly obligationsin which case it is advisable to proceed to pay outstanding debts starting with those with the highest interest ratenormally associated with informal lenders and credit cards.

If there are no debts, the family can set monthly savings goals, which must be at least 50% of the remaining fixed income after paying important expenses. Likewise, eventual income must be saved in a high percentage.

And it is that achieving a good savings base will prevent us from having to go into debt before any eventuality in the future, since unplanned debt is the direct path to financial difficulties and personal bankruptcy.

concluded the obligation payment planning, then you can consider the space for fun and leisure expenses, always after having met the monthly savings goal. In the same way, having reached a certain level of savings, you can consider purchasing high-value items, such as electrical appliances or the latest generation cell phone.

This planning of personal and family finances at the beginning of the year gives us the path to follow in the following months. In the future, as time goes by, we must write down what we are spending and compare it with what had been planned.

This comparison of the reality versus planning will give us ideas of how our financial discipline is going and what change we should make in our consumption habits, in some cases to cut costs, in others to give us more freedom.

In conclusion, the year 2023 that has just begun will be a period of many economic challenges, both national and international, so correctly planning income and expenses is more important than ever to maintain adequate financial health, and with it, a good mental health.

 

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