How strong are you in terms of money, check yourself through these 5 indicators
We all Do financial planning to settle your life in a better way. After a while we assume that now our life is going well and we are settled. But, is it really so? Have you become financially strong? Today we are telling you five simple ways to check how financially capable you are.
budget friendly spending
Budgeting every month is our very best formula to manage your financial situation. By making a budget at the beginning of the month, we estimate the expenditure and savings. Along with this, it also comes to know where the wasteful expenditure is being done. Let’s understand the second aspect of the budget. If, you are not able to spend according to your budget or some unplanned expenditure is coming in the month due to which your financial condition is deteriorating, then it is an alarm bell. Being financially settled means that your financial position is ready to support such expenses. If not, then you should plan to be prepared to deal with such expenses.
money for monthly expenses
Are you able to easily pay off the monthly expenses like house rent, EMI, utility bills etc.? You are not facing any problem in paying them. If it is coming and you have to resort to a friend or credit card to pay these bills, then be careful. This is a direct indication that you are not financially sound and there is a lot of scope for improvement in your financial position.
credit card loan
There comes a time in the life of all of us, when we have to take a loan from a friend, relative or bank to fulfill our needs. This is such a time when we are not able to meet that expenditure from our savings and have to take a loan to meet it. Then we pay it off gradually. If, you too do this, then it is a good sign that you are conscious about your financial plan. On the other hand, if you are obliged to withdraw cash from a credit card to meet small needs, then it is not a good sign. It shows that your financial position is not strong but very weak.
Asset Vs Debt Burden
It is very important to have a balance between liquid and other assets and debt. An ideal figure for this is measured by your income and age. Generally, the lower the average debt burden, the better. If, every month, you are facing problem in paying your loan EMI, then it is a sign of weak financial position. Try to reduce it as soon as possible from your savings and other savings. If you don’t do this, it’s not okay. Sometimes it will be very difficult for you to cover the big expenses.
increased dependence on credit cards
Credit card gives freedom to shop. When we do not have money, we are able to buy the things we need and do not have to pay the bill too soon. When it comes time to pay the bill, pay the minimum amount and keep the bill outstanding. this is not right. If you do not pay your credit card bills on time, your debt burden increases. If, you are doing this then it shows your weak financial position. If even three out of these five are happening to you, then there is a need to be alert ahead of time. You can improve them with proper planning.
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