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Here are five practical expressions for managing your money.
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1 | |
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Use a written plan to aid the following:
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Distinguish between needs, wants, and desires. Make
needs your priority. |
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Cut unnecessary expenses. Sell discretionary items of value. Use the
proceeds to pay off debts and build an emergency fund (see point 5). |
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Make key lifestyle adjustments. Shift your focus from accumulating
possessions to managing your resources. |
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Think before buying impulsively. Separate emotions from spending. |
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2 | |
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Keep track of the progress you’re making toward your financial
goals.
Making small “course corrections” along the way keeps you from
going in the wrong direction! Not monitoring your budget means your money is
out of control, and that can hamper your quality of life.
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3 | |
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Limit your use of credit. Pay with cash.
Avoid leverage (borrowing) by making significant down
payments (deposits) when borrowing. Make and follow a plan to become debt
free.
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4 | |
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Practice saving regularly for short and long-term goals.
Setting goals is akin to defining priorities, so this step
helps you use your limited resources and income to attain your highest
priorities. To make your savings grow, you must “feed” them. Even
if you have to start with a small amount, make it a point to set money aside
on a regular basis.
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5 | |
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Develop a surplus and wealth management plan.
Steadily work up to an appropriately sized emergency fund of
a few months of living expenses (at least $1000). Here are a few tips on where
to start.
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Sell items of value on an online auction site like Ebay, or by having a
yard sale. |
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Place a portion of your tax refund into you emergency fund. |
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Consider discontinuing pay TV [cable
television], home phone (use mobile [cell] phone instead), or other
discretionary expenses |
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Take your lunch to work for six months. |
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Do you have two new cars? Consider selling one and
driving a reliable used car instead. You may be left with a cash surplus in
the process. |
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Consider a family-friendly, part-time job that will allow you or your
spouse to earn additional income for your emergency fund.
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Determine how much is enough, or you run the risk that unforeseen
circumstances will leave you owing more than your assets are worth.
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Courtesy Crown Financial Ministries
www.Crown.org.au
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