There’s a whole host of guidelines, rules, guides, recommendations, etc. that you can follow. But the point to consider here is, how can you judge if you’re really good in financial management? You might be on the right track, even if you aren’t quite there yet. These 10 signs are great “road signs” to let you know you’re on the right path and good in financial management.
1. You have great credit
While your credit score is not the supreme factor of financial management, your good credit score indicates your solid financial management expertise. If you have excellent credit, it shows that you have minimal debt and always pay your bills on time. If you don’t use credit, you don’t need to get worked up about it, since there are other signs to know that you’re good in financial management.
2. You are proactive
A good financial manager always creates a monthly budget. Even if you earn a small income monthly, it doesn’t mean there is no need to plan for it. Indeed, you need a budget most, since you have very little or even no left-over cash that can go to savings which could eventually be utilized for a healthier financial future.
3. You save money each month
If you save money each month that means that you are on the right roadway. If you are saving some money in a rainy day fund and your retirement fund regularly, that is an indication of a good finance manager. If the situation is totally opposite and you can’t save “enough,” that means you aren’t managing your finances well.
4. You prioritize things
A great money manager always schedules his priorities – which is the ladder needed to reach your needs and eventually your goals. If you are not putting off anything important and responding to emergencies it shows how good you are at managing your pockets.
5. You don’t stress out at the end of the month
If your stress starts bouncing up as the end of the month comes and you desperately wait for your paycheck, there is an honest probability that you simply aren’t managing your finances well. However, if you aren’t worried at the end of the month about the money in your pocket, because you know that you can easily manage until the succeeding paycheck without any worry, you are undoubtedly doing something that shows how strong you are at managing your finances.
6. You look for additional opportunities
You take extra time hunting for additional income streams or considering to invest part of the budget in other activities, or doing cost-saving activities. It’s undeniably fruitful to achieve your goals and proves that you are good in financial management.
7. You pay bills on time
If you are paying your bills on time, or you don’t adjourn paying your bills, that’s a strong sign that you are managing your finances properly.
8. You understand your insurance policies
There are many mechanisms to an insurance plan. If you do not have extra expenses and understand components of an insurance policy then you are on the right path. If you are spending too much each month for something you don’t need or want, then you need to work on your finances.
9. You have no liabilities
If you own a credit card and you are actively paying off your credit card bills at the end of each month then you are certainly a good financial manager. The element of being able to live within your resources, avoiding liability, is a good emblem.
10. You manage all your liabilities
The existence of liabilities doesn’t mean that you are bad at managing finances. Certain types of liability are acceptable, like car loans, house loans and education loans, as long as they are manageable. Additionally, if you are keenly realizing a debt reimbursement plan, you are probably doing just fine to manage your finances. Get it together and make a difference for you and your family before your option to choose is replaced by the intestacy laws of your state.
