Taking control over personal finance

Wish you a very happy and prosperous new year!

The purpose of this thread is share and invite views as how to manage personal finance/household expenses efficiently to enable saving good portion of earnings for investing. Apparently, this thread is not directly related to stocks hence requesting administrator to remove in case if it doesn’t seems relevant here or move under other category if required.

As Ernest Haskins has said “Save a little money each month and at the end of the year you’ll be surprised at how little you have”, it’s not only important to invest wisely to grow your money, it’s also very important to save and invest good amount of money to make a difference in life.

We are very thankful and indebted to all seniors who share the valuable information/analysis/wisdom with us on this great ValuePickr platform which essentially the reason we are able to reap benefits in this volatile, un-predictive market but the knowledge and the unparalleled guidance available here is truly beneficial only in case where you are able to invest some significant amount of your net-worth or take home salary (for salaried people). You can recall seeing some people who always complains being short on money and most common reason is the mess in their personal finance instead of low earning/salary. I recall a recent conversation with Director of Finance in my company where he explained how he work overtime to make our company financially efficient but have no clue about his own personal finance and admitted that it’s in mess. Apparently, This is not the case with us at ValuePickr since most of us I’m sure are very organised and responsible about spending/managing money but still it’s a common observation that for many people “it’s more difficult to manage money than earning it”.

One of the most important step is to track your expenses, where money is going or in fact disappearing. There are various ways to do that, select/use whatever deemed fit for your and your family; be it a diary, notebook, some software or website or in mobile/tablet apps etc. I tried few things before settling on a Excel spreadsheet to capture all my income/expenses. I’m using this pre-formatted spreadsheet since 2009 and in all these 4 years, I’m able to precisely know how money is flowing and thus able to save and invest significant portion of my take home.

Please download the pre-formatted Excel spreadsheet from here: http://bit.ly/pfsheet2014

The spreadsheet contains sheets for complete 12 months of 2014 and some additional sheets for purposes like keeping track of your goals, extra income, passive income, money you have given/taken from friends/relatives, annual view of income/expenses, insurance etc.

Since this is the starting of new year, it’s a great time to start using it. 2 minutes is what it’s requires daily.

I’ll give a brief overview about how to use it in subsequent posts. Please share your views/queries/suggestions.