As the economy continues to bite and the cost of living keeps rising, kenyans are looking for ways to manage their finances. Here are the only tips you need:
1) Have a budget
Having a budget allows you to understand your financial situation by tracking your income and expenditures. It helps you control your spending by setting limits on various expense categories.
A budget allows you to create and work towards financial goals like debt repayment, vacation savings, or retirement planning.
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2)Calculate Your Income:
Begin by calculating your total monthly or annual income. Salary, wages, rental income, investments, and other expenses are all included.
3)Make a list of your expenses:
Divide your spending into two categories: fixed and variable. Rent or mortgage payments, utilities, insurance, and loan payments are examples of fixed expenses. Examples of variable expenses include groceries, entertainment, dining out, and other discretionary spending.
4)Set specific financial objectives:
Set financial goals that are explicit, quantifiable, realistic, and relevant. Having defined goals will drive your budgeting decisions, whether saving for an emergency fund, paying off credit card debt, or preparing for a down payment on a property.
5)Allocate your Funds:
Divide your income to cover both fixed and variable expenses while allowing for savings and debt reduction. Prioritise necessary expenses.
6) Monitor and Track Expenses:
Keep track of your spending regularly to ensure you stay within your allocated limitations. This can be accomplished with budgeting applications, spreadsheets, or pen and paper.
7) Make changes:
Life is unpredictable, and unforeseen expenses may arise. Adjust your budget as needed to account for changes in your income or expenses.
