Tips on how to be Money Sensible

I avoid the “Debt Trap” or “Credit Card Trap” by always buying when I know I can pay for it in full when the bill comes. Interest is compounded, so I never buy on credit, no matter what. If I cannot trust myself to not overspend, I leave my cards at home. That way I spend only the cash I have. Finally, keep a spreadsheet of what comes in and what goes out. That way, you will be more conscious of your spending and aware of any deficits.

Health and Wealth are indeed interrelated. When I am fit and healthy, I have the energy, motivation and mental clarity to plan my finances better and work towards my financial goals.

I’m money sensible: I plan my finances so I will be prepared for emergencies as well as be as to retire at an age I want and have enough for my retirement. I budget and keep a log of my finances so I know if I’m on the right path to my financial goals. I spend wisely and try to avoid ostentatious purchases. I don’t invest in things I don’t understand. I learn as much as I can about insurance and investments and I choose plans that suit my needs.

Whenever someone approaches me about some get rich quick scheme, I am skeptical. Now with Google, there’s no excuse not to find out if there’s anything to a claim. Google a scheme or product and you’ll find forums and reviews of others’ experiences of it. Never ever fall prey to the usual ploy to get you to sign up with the claim that this offer is only for now. Lastly, remember there’s no such thing as a free lunch. Keep your guard up, don’t be fooled by someone’s friendliness or smart appearance. Do not be afraid to get up and leave.

Gifts need not be expensive to be meaningful. The best gifts are often personal ones, made by the giver. It not only saves you money but also shows you took the trouble instead of just buying one out of a thousand identical factory made ones. Instead of buying a gift, bake or cook something the person will like. If you can sew or knit, make them something. This is often a less costly gift most people would appreciate, especially if they knew you made it yourself. We all have stuff that we’ve never used and never will. Give them away as gifts if they’re appropriate.

First, break the habit of using credit cards. Cards do not feel like cold hard cash, so it’s easy to spend thoughtlessly. Leave the cards at home and use cash instead.
Second, keep a spending log and analyze how much and what you spend on. Then see how you can cut out unnecessary expenses. Make a budget to ensure you have the cash for necessary expenses and also to save.
Third, if you already have debts on a card, stop using that card and work on paying it off.
Fourth, use cards responsibly. Use them only when you have the cash to pay the bills. And do not get more cards than you need.

I take charge of my personal finances by spending within my means, saving and investing regularly in a variety of low cost investment products that I understand and going for Direct Purchase Insurance which does not charge commissions.

Take charge of your finances by planning now! Procrastinating is detrimental to your long-term financial health. Don’t wait for a crisis or major life event to happen: start implementing a plan now! Don’t buy consumer items (cars, clothing, vacations, and so on) that lose value over time on credit. Borrow, if you must, very wisely: only to make investments in things that gain value, e.g. a business, an education. Use credit cards only for convenience, not for borrowing. If you don’t have the discipline, get rid of your cards and use only cash and debit cards. Live within your means and don’t try to keep up with your peers. Save and invest a fixed percent of your income. Take the trouble to research investments and their risks and costs.

by Li Mae