1. Sort out the balance of personal assets and liabilities, and clearly know your net worth

There are two types of assets: one is current assets and the other is fixed assets. Current assets are cash on hand, bank deposits, and accounts receivable. Real estate is included in assets, and a loan account can be established to record this part of the data. When a few percent of the down payment is paid or paid in full, it is not included in the expenditure, but is a conversion of asset form, converting current assets into fixed assets.

There are two types of liabilities: one is current liabilities and the other is long-term liabilities. Current liabilities are divided into credit cards and accounts payable. A car is actually a consumable product. You pay a fee when buying it, and you have to pay annual premiums and monthly warranty fees. It has to be said that this is a liability.

2. Use APP to help personal memory and record the income and expenditure of each item

For friends who have poor control, it is not recommended to use overdraft consumption. If you don't keep accounts, you will be suspicious when you see the bill amount. You have to check the bill details to know what you are spending on.

Generally, I use manual accounting. Although it is very convenient to enter accounts through text messages, for personal privacy and to reduce laziness, I still use manual accounting.

3. Understand the source of money, and divide expenditures into necessary expenditures and non-essential expenditures

Necessary expenditures include: rent, food expenses, transportation expenses, phone bills, and daily living expenses. If a family has children, there will be living expenses, tuition fees, etc. for the children. The scope of non-essential expenditures is wide, including buying clothes, bags, holiday gifts, etc.

The difference between the two is related to the nature of the work and cannot be comprehensively summarized. For example, if you are a salesperson, you need to maintain customer relationships and give gifts, invite interested parties to dinner and discuss business, etc. In fact, it depends on how you define it personally. For example, long-term investment in yourself, buying books every month, paying tuition fees to study, traveling to gain knowledge, etc. can also be divided into necessary expenses.

4. Prepare a monthly budget table so that the monthly income and expenditure difference is not equal to 0, and break away from the moonlight tribe

The monthly budget table can be inconsistent, because there will be different highlights every month The setting of the budget table is based on the situation that you clearly know your necessary expenses. When you persist for a period of time and watch your net worth grow with each month, you will have a sense of satisfaction and accomplishment.

That’s it for the editor of the basic knowledge of financial management. For more basic knowledge of investment and financial management, techniques and methods, precautions, news and information, etc., the editor will pay attention in a timely manner. Bookkeeping is a crucial step in financial management. Some people may ask: Will keeping books really make you happy? Checking your financial status every day and being unable to buy what you want to buy will take away the joy of life. You may think this way now, but as time goes by, you will be grateful for who you are now. Your life has become more self-disciplined, your quality of life has improved, and more importantly, your life will feel more secure. There is a kind of happiness called satisfaction, and there is a kind of happiness called contentment.