you live paycheck to paycheck– Or do you have a lot of income but it always goes away somewhere? This could be a sign that your personal finances are not healthy. Although it is not something that needs to be examined by a doctor. But poor finances can also cause financial problems, such as a bad life or even stress.
follow investment An important characteristic of people with good financial status is having a stable income. Expenses change infrequently. Good return on investment and increased balance
If so What are the characteristics of unhealthy finances? And how to manage it? Check out the following conversation:
Characteristics of weak finances
1. Expenses are greater than income.
One key characteristic of poor finances is that the amount of expenses is greater than income. For example, your income is IDR 3,000,000 while your expenses are IDR 3,500,000. Of course, you can meet a deficit of IDR 500,000 from sources. Other things, whether it's pocket money, paying later, or even bank debt.
If this happens once or twice due to urgent need. Of course that won't be a problem. This will be a problem if it continues. Because in the end Bank interest and payments will be a burden on your personal finances in the long run.
2. Has a high debt ratio
in personal financial management Signs of good debt The maximum is no more than 30% of your total income. For example, your monthly income is IDR 3,000,000, so the maximum value of your debt and interest is IDR 1,000,000. The purpose of this limit is to ensure that you can repay your debt and in the future. Will be able to access debt or other credit if needed.
3. No emergency funds
in personal financial management Emergency fund is Importantly, this fund serves to meet your daily needs if you or your family are in financial trouble, for example if you are the breadwinner and you are laid off from your job. Your emergency fund can be used to meet your family's needs while you find a new job.
4. No insurance
Another bad financial habit is not having insurance. Personal finance pyramid,Insurance is an important thing that you must have before deciding to invest. Especially health and accident insurance. Because often disasters in the form of illness or accidents occur unexpectedly. Having this insurance will reduce your burden of paying medical bills.
Fortunately, there is now compulsory insurance: BPJS Health and BPJS Employment. As a worker, you should have at least these two types of insurance, just in case.
5. Often stressed about financial management
Do you often fear that your future needs will not be met? Do you often worry about not being able to buy the things you want? It may be because your finances are not strong. People who are financially well off do not stress about meeting their daily needs or personal desires. Because they can meet those needs. Or because they can control their own personal desires?
Causes of poor finances
1. Wasteful lifestyle
One of the reasons why people's finances are not strong is living an extravagant lifestyle, such as buying things that are not really necessary, such as coffee or brand name bags, etc. In addition, with the ease of the current payment system with people who pay later. Chances of having an unhealthy lifestyle and various financial problems It's definitely increased.
2. Creating a Sandwich
Unhealthy finances can happen because you are the sandwich generation because you have to take care of your parents and raise your children. This condition can leave a person living from paycheck to paycheck and becoming trapped. rat race cycle–
3. Not having access to smart loans
There are now many credit lines you can access. Starting with a credit card bank loans online loans to the payer Everything is easily attainable, however, if not limited and managed wisely. Various facilities These can cause you financial problems.
4. Other causes
Poor finances can also be caused by other problems, such as limited knowledge about insurance products. Problems with trust in bank products and failure to control emotions when purchasing goods and services.
Tips for managing your finances for good health
1. Prepare a monthly financial plan.
To keep your finances strong and stable You can plan your monthly finances. in the financial plan Keep a record of your needs and desires. that you will buy in the next month or so Don't forget to prepare posts for saving and investing as well.
2. Pay off debt first.
So that debt interest does not grow and become a financial burden in the long run. It's a good idea to pay down debt regularly first. If possible, try to make sure that the amount you deposit to pay off debt is more than it should be so that you can pay it off more quickly.
3. Save it, don't waste it.
Instead of waiting for the remaining monthly money to be invested You can set aside some of your monthly money to invest as soon as you earn it. For example, on the 25th, you will receive your money. Part of your salary is then allocated to savings and investments at that time. To be more disciplined You can take advantage of the auto debit feature now available in many savings and investment applications.
4. Communicate financial terms with your closest family.
If you are married Communicate your financial plan with your partner. In the same way If you come from the sandwich generation It never hurts to share your financial situation with your parents or siblings. The goal is to be able to better share the burden of caring for parents.
5. Minimize the use of non-cash transactions.
Although the availability of non-cash payment facilities such as debit cards, credit cards and QRIS has made the payment process easier. But it cannot be denied that the existence of these non-cash payment facilities also has the potential to promote Impulsive purchases– Prepare enough cash to buy daily necessities. If urgently needed Use non-cash payment methods.
Keeping your finances healthy isn't just important to you right now. but also your future self and future generations, and teach your children to manage their finances well. So that in the future his life will be safer, more comfortable and more stable.
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