Financial Wisdom: Living Within Your Means Without Sacrificing Happiness

By Author: Chaitanya Kumari
Total Articles: 99
Comment this article

Wisdom is when you realize that being greedy is not a good quality you should adhere to. Being financially wise will help you become stable in the same aspect of your life. Learn to spend only on necessary items and curtail your whims to spend on anything you want. Refrain from buying items you find in your neighbor’s or friend’s house.

Being envious of others’ achievements or belongings only leads to spending more than what you earn. Always remember that you have responsibilities and therefore it is not a good idea to spend on unnecessary products.

Avoiding Debt
Getting into debt because you were greedy and wanted something desperately can ruin your financial stability. Buying a big car when you already have a small one is simply a matter of greed and not a necessity. A small car can also be useful to you particularly if you have a small family or you are living alone.

Borrowing money from the bank on a loan or from someone else just because you want to fulfill your dream of having a big car is foolishness. It will lead you to a monetary burden that will be a big problem ahead, particularly ...
... when you do not have money to spend on an emergency.

How to Do Personal Budgeting?
Take charge of your financial situation. Create a personal budget. It can empower you and help you work towards achieving your financial goals. It will aid you in keeping track of your income and expenses which must be balanced. Besides, it will help you identify the areas where you can save more money to become financially stable.

Here are some simple yet effective strategies for budgeting:

Track your expenses for a short period. Make a chart or write down your expenses, whether big or small. You will have a clear picture of how much you spend daily. This will help identify areas where money can be saved.
Recognize the distinction between needs and wants . Needs are essential to survive like your expenses for food, shelter, and transport. Wants are your desires, like visiting a multiplex every time to watch a movie. Differentiate between them and establish priorities so that you can allocate money accordingly.
You can roughly divide your income by allocating 50% to essential expenses, 30% to savings, and 20% to wants.
This is an ideal picture. You can adjust the percentages based on your finances, but remember that your savings should exceed the amount you spend on wants
Set up automated savings so that a set amount is automatically deducted from your account at the start of each month. Always try to avoid touching that account unless it is an emergency.
Shopping at intervals is imperative, especially if you have a growing kid at home or for groceries. Make a proper list while buying groceries; this streamlines your expenses and compares prices before buying. This will help you get a good deal on various items.
You can be happy with your income if you have the wisdom to control your finances.

Living smartly covers helpful topics for being wise, healthy and financially sufficient and other aspects like cultivating wisdom gifting, gift ideas, health protection, being sensible among other topics for smart living.