As a "veteran" in financial management, let me tell you some common sense about financial management that ordinary people should know: 1. Learn to keep accounts; 2. Distinguish between assets and liabilities; 3. Understand your own risk tolerance; 4. Have a correct investment.

Mentality As our income and living standards improve, we have more and more money at our disposal. People are no longer satisfied with just putting money in the bank, but want to make "money make money", so everyone

Many people have begun to embark on their own financial management path, and the above four financial management common sense can make you get twice the result with half the effort on the road of financial management.

Next, let me tell you about the above common sense in detail: 1. Learn to keep accounts. Because keeping accounts is the first step in financial management, only when we know where our money is spent can we better optimize expenditures.

Make sound financial budgets and plans.

This is like a doctor seeing a patient. Only by giving the patient a preliminary diagnosis can he prescribe better medicine.

By keeping accounts, we can clearly see the flow of money from the bills, so that we can analyze the rationality of expenditures and see what is overspent and where is the least spent. These are unnecessary

expenditure.

This will help us control expenditures, increase income balance, and also accumulate original funds for future financial management.

Many people's salary is paid monthly, and it is common for them to spend it all before the end of the month. They live a life of paycheck to paycheck, but they still cannot save money even if they want to.

Because you don’t know where your money is spent, what is necessary consumption and what is impulse consumption.

Spend a little here and a little there, only to find at the end of the month that you have very little, or even none, of your salary left.

There are many accounting software on the market at present, and they are very convenient, such as: Suishouji, DailyBill, Squirrel Accounting, and NetEase Youqian. These are relatively easy-to-use accounting software. When you spend money, just open the software and record it.

That's it.

Very convenient and simple.

Take Notes as an example: For example, today I spent 88 yuan on lunch, then I can record it by opening the software.

Then you can choose the one that suits you from the above apps to download and use according to your own hobbies.

2. Distinguish between assets and liabilities Assets are things that can put money in your pocket, and they can continuously bring you income.

Just like a golden goose laying eggs, as long as the golden goose is around, it will keep laying eggs. The eggs it lays will be used as feed for the golden goose. Then the golden goose will become fatter and fatter and lay more eggs.

Debt is something that takes money out of your pocket and keeps it away from you.

Do you know what assets and liabilities are now?

I will give you a question to test everyone: Question: Do you think a house is an asset?

A: Yes B: No You can close your eyes first, don’t look at the answers below, and choose your answer in your mind.

If you chose option A, then sorry, you are wrong.

If you choose B, don’t be too happy because you are not right either.

At this time, everyone will definitely be confused. Why is the house neither an asset nor a liability?

In fact, whether a house is an asset or a liability cannot be generalized, it depends on what condition it is in.

For example: Housing is a liability for the house you live in, which requires you to pay property management fees, water and electricity fees, maintenance fees, etc.

The house you live in does not put a penny into your pocket. On the contrary, it takes the money out of your pocket.

So housing is not your asset but your liability.

For example: a rented house is an asset because the rented house can bring you a steady stream of rental cash flow.

So to put it simply: Assets are things that put money into your pocket, and liabilities are things that take money out of your pocket.

Rich people like to turn money into assets, and then the assets generate money, and then they spend more money to buy assets. More assets can generate more money. Through the continuous cycle, they become richer and richer.

In fact, financial management is to turn as much of our money into assets instead of liabilities as possible.

Here I will give you a formula to check your current financial situation: Asset-liability ratio = total liabilities/total assets. Generally speaking, it is appropriate for the asset-liability ratio not to exceed 30% to 40%. If it is greater than 50%, then it means that your financial situation is not good.

Worrying about your health, and even possible financial crisis!

So how do you know your own responsibility?

You can use this form to count your assets and debts.

If you need a balance sheet template, just pay attention in the comment area and I will send it to you when the time comes.

3. Understand your own risk tolerance. When investing in financial management, you must first consider the risks and then the benefits.

If risks cannot be reasonably controlled, how can we start talking about returns?

Investment involves risks, and returns and risks are often positively correlated.

Don't just see the high returns on the surface of an investment product and ignore the high risks behind it.