How to Manage Money? Money Market Blog

The moment you start earning is the time you have to start managing your money. Many simply don’t or don’t know how. Getting money matters in order is the first thing you should learn. In this post we’ll be taking you through some tried and tested ways in which you can manage your money. Once you start earning you’ll start having bank accounts, insurance, places to save your money, credit cards and so much more, keeping all this in track is key to good management. So without further ado let’s look at how to manage money the easy way.

Getting things right with setting a Budget: 

Start off with a budget. Believe me this is essential. Knowing how much is coming in and how much you need to spend with an emphasis on the word need, is key to learning how to manage money. By having a budget you know just how much you can spend and you stick to it no matter what. This stops you from going into a never ending cycle of debt. Not only that knowing what you have coming in and how much you have left over will help you save.

Saving is essential when it comes to planning your retirement and other necessary unforeseen expenditures.

How to Manage Money- Know your Expenses: 

Maintain a list of all your expenses you incur in a month. This is something a lot of folk don’t do. Ask them how much they spend in a month and they don’t know. If you’re one of these people, here’s the chance to start maintaining accounts. Plus it’s easy to do. For a month start making a list of all your expenses. Remember to take into account all the cash as well as credit card payments too. Once this is done you will get a fair idea of all you have spent. You can then tally this up with your income to see how much if any you have left over. This step in how to manage money is great too when it comes to avoiding any unnecessary expenses. Believe me we all have some of those.

How to Manage Money- Knowing your Income: 

In this step you’ll know all you have coming in. whether it be from bank interest or salary or any other place. Many people already know how much they make in a month. This is an important step when it comes to managing finances. It’s only once you know what you have can you then know how much to spend.

As mentioned in the earlier step take all your monthly expenses and subtract it from your income. If you’re left over with a negative figure, it’s time to take stock and start cutting your expenses ASAP.

Alternatively if you have a positive figure, this is great. You can either pay off some debts and maybe start saving something.

How to Manage Money Better- Get your Debt Together: 

Many people who want to learn how to manage money, have debts they need paying off. In this step you need to figure out all that needs paying. In many cases there is even an option where you can get all your unsecured debt together and make one payment. The advantage of this is that you don’t have to pay things individually and you won’t lose track of what all you have to pay.

Understanding the Stock Market for Beginners!

Why is the stock market important for you? The simplest answer to that is that you can invest your money. Yes there are other routes to go when it comes to investing your money. But often times those routes do not pay adequate returns. That’s where investing in the stock market comes in. you can many a times get more than a good payout by dabbling in shares. But of course there’s always the possibility of losing all your money too. This is known as a risk return payoff. The higher the risk the higher the payout but also more the chances of losing all your investment. There are two types of investing- day trading (steer well away from this for now) and long term investing.

Understanding the Stock Market for Beginners:

In this post we’ll be taking you through an understanding the stock market for beginners.

Decide on the Type of Investor you are: 

Before we delve further into an understanding the stock market for beginners you need to know the type of investor you are. Whenever you open a brokerage account, which you have to by the way, they often ask you what your goals are and how much risk are you willing to bear.

Some investors are the put – my – money – in – and – forget - it kind of type while others want to take a more active participation in their investing. Most brokers allow you to invest in stocks, bonds, mutual funds, ETFs or exchange traded funds and index funds.

Knowing which Broker to Take: 

This will depend on your preferences and what each has to offer. But basically there are two types of brokers:

• Full Service brokers- they give you all things related to money management. These include retirement advice, healthcare, also where to invest your money in order to get adequate returns to meet your financial goals. Since they give you a big bang for your buck, they also charge a lot. These service providers are therefore mostly used by higher net worth clients. These costs include a percentage of your transactions, a percentage of your assets managed and even a yearly membership fee. The minimum ranges from account sizes of $25,000 and above.

• Discount brokers- this type of brokerage has become the most common nowadays. They have features where you can place the transaction you want and even a place where you can invest it and forget it feature too. Since they have become so popular they even have apps, graphs and many more features on their websites. As for cost, yes they do take a percentage of your transactions but the costs are relatively low as compared to the brokers up above.

There’s always the option of investing through your employer: 

If you don’t happen to have much laying about to invest then there’s always your employer’s retirement plan. These plans don’t require a lot of investment. In some cases it is as low as 1% of your salary. What’s even more great with this route of investing is that it is tax deductible. This means that before you calculate your tax payable from your income you can deduct this investment. Thus lowering your tax payable. Also with annual increases you can even add to your contributions later on too.

Minimum Deposit requirements when it comes to understanding the stock market for beginners: 

Many brokers or financial institutions have a requirement of a minimum deposit. This means they won’t accept your investment if you don’t invest a certain amount. This amount varies from firm to firm. The best advice we can give in this regard is to look around. Check your brokers available for the amount of commissions they charge, what their reviews are and so forth.

In some cases a deposit is not even charged while in others if you commit a higher amount to investing then they waive off a portion of their management fees and trade costs. Some also offer commission free- trades for initial trades when you open an account.

Now Coming to Commissions and fees: 

When it comes to understanding the stock market for beginners, you need to first understand that nothing comes free. This goes for brokers too. Although you don’t need to pay much when it comes to investing with brokers, the fact is that something is still chargeable.

In many cases your broker will charge you an amount for every trade you make. This can range anywhere from $2 to $10 per trade. Still other brokers may not charge you for trades, believe me they make up for it in other ways. That’s where the fine print comes in handy.

Whenever and however you trade you need to keep this in mind. Ultimately it will have a bearing on your profit margins. In more practical terms if you’re an active investor and like to frequently buy and sell stocks, with every transaction there are trade fees to pay. This eats into your profits margins leaving you with little or in some cases nothing. A trade is considered to be buying or selling stocks in a company. Note the “a company” here. If you happen to buy stocks of three different companies at the same time, it is considered as three different trades.

Mutual Fund Fees: 

If you happen to like mutual funds you also need to know that there are additional costs when it comes to this form of investing too. Besides the normal trade fees you even have management expense ratio or MER for short. But more on this later.

First of all what are mutual funds. Mutual funds are basically a pool of stocks from various companies. As they say never put all you money into one basket of eggs. The same is applicable here as well. In the stock market you never want to put all your money into one company. Mutual funds help in diversifying the risks. Now to MER, these are fees where the management charges a percentage normally ranging from 0.05% to 0.7% of the assets in the fund.

There is much more to understanding the stock market for beginners. A lot of reading and learning is required before you put you hard earned money anywhere.

Personal Finance Tips to Get Your Money Grow

When it comes to managing money things don’t have to be complicated. Nor do you require to be an accounting genius to know how to manage your finances. All you do need is money to manage and a strict approach to managing, that you stick to no matter what. In this post we’ll be looking at some personal finance tips to know to better managing your money. With these tips in mind you’ll well be on your road to recovering from any money related problems. Yes it won’t be easy nor is it going to be fast. But it’s going to be the first step in getting out of your money problems. So without wasting anymore time let’s look at these personal finance tips shall we?

Personal Finance Tips-Spending less than you earn: 

This may sound as an easy one but you can’t overemphasize the importance of this personal finance tip. If you keep spending more than you earn you’ll always be in debt. It’s as simple as that. The point is easy on paper than actual practice. However if you want to avoid living hand to mouth then you have to put this tip into practice.

To spend less than you earn its’ a simple case of knowing how much you spend. You can do this by starting to trace where you spend your money. Take the trouble of checking your expenditures and start avoid paying for anything unnecessary. You should be able to justify any cost you incur. I mean really justify.

Another easy yet important one- Budgeting: 

This is another no brainier. When it comes to managing finance, budgeting isn’t far behind. Any blog, any personal finance tips will all deal with budgeting. This does not mean that you have to shy away from it thinking it’s well out of your league. It’s actually quite simple to do.

Budgeting is a simple matter of knowing what you earn less what you spend. What you spend is what is necessary. By doing this you know just what to spend your money on and you stick to it. In the end you may be leftover with something to actually pay off some debts or maybe even save.

When it comes to budgeting a rule of thumb is the 50/20/30 rule. This rule states that you get to spend 50% on your necessities, 20% goes into savings and the rest 30% is yours for the pickings. But of course this depends person to person and paycheck to paycheck. But it is still a rule to strive for achieving.

Personal Finance Tips- Know your Incomes and Expenses: 

This personal finance tip is part and parcel of budgeting. To budget you need to know your incomes and expenses. Many of us already know our incomes but expenses is another matter altogether. To know your expenses you can always check what you spent in the last month. Take out all your bills including the ones you paid by card and ask yourself whether all those expenses were really necessary.

At the end of this draw out a plan and follow it.

Personal Money Management: Key to Successful Planning

Money: It’s what makes the world go around. When there’s less of it it is a problem when there’s more of it too we have problems of how to manage it. The word money and problems are two sides of the same coin. It would be nice if we never had to worry about money but that isn’t realistic now, is it? You cannot altogether do away with money problems but a few simple tips can help you in your personal money management journey. With these tips on mind you can reduce your debt and maybe even start saving something for the future. So without wasting anymore time let’s take a look at what we can do in our personal money management journey.

Personal Money Management-Set Your Financial Goals: 

Without any goals we are directionless. Without knowing where you’re going how do you begin your journey. You can set any goals, say for example going on a world tour, or sending your kid to college or maybe even the possibility of retiring early. Setting these goals will decide the course of your personal money management journey. Let’s say you want to own your own home, you have to start moving in that direction with your finances. This means saving what you have left over after essentials. There will also be less money then, for frivolous stuff like that new phone that you don’t really need.

The other side of not having any goals means that you’re basically rudderless. In more practical terms you may buy things you don’t really need ending up in debts and not really saving anything. While this may not harm you at present it will bite you… (You know where) later on in life.

How to set goals in Personal Money Management: 

• Separate your long term goals form your short term goals

• Keep both separate

• Long term goals such as buying your own home, retiring early or taking a world tour

• Short term goals such as paying off your debts, buying only things that are required

• Decide which is the most important, in other words prioritize

Now you got your goals set out a plan of action: 

After you’ve set your goals the next step in your personal money management journey is to set a course of action. This entails setting out a monthly budget where you match your receipts with your essential payments. Note the word essential payments here. This will help you in not only meeting your monthly expenditures but in also paying off your debts. Once your debts are paid off you may actually have something to save. Thus begins the road to attaining your goals.

Of course with this step, you need to prioritize too. Start paying off things that are absolutely urgent or thing that takes up a huge chunk of your salary. Say for example you have a loan that needs paying off. Keep that as your priority. By doing so you can reduce your interest payments as well as installments.

Knowing your goal will also help you in saving. If you want to buy a house you need to know which investment route will get you to that goal the fastest.

The most important of all – Stick To Your Plan of personal money management!

No transaction charge on NEFT payments from Jan 2020

NEFT Payment – Not chargeable

Banks will no longer be charging saving bank account holders for any NEFT online transactions from January 2020. The Reserve Bank of India (RBI) has directed banks with this instruction through a press release on 8th November. RBI has stated in the press release that this has been initiated to promote digital payment.

In its July statement it had mentioned, ‘In order to provide an impetus to digital funds movement, it has been decided to do away with the charges levied by the Reserve Bank for transactions processed in the RTGS and NEFT systems.

Banks in turn will be required, to pass the benefits to their customers’. NEFT is a disbursement system expediting funds transfer from one bank account to another. An individual can avail this service through the option of utilising Internet banking or visit the branch in his area, though not all the branches provide this service.

Customers will not have to pay any charges for the transaction they undertake through the standard NEFT system.

Smooth Settlement of Transactions

To enable customer with easy banking transaction comprising of NEFT payment transfer, RBI has made banking transaction all through the day against only working hours on weekdays.

RBI Governor Shaktikanta Das, in its monetary policy mentioned that the revised timings would be effective from December this year. Earlier NEFT was made available till 7.45 pm on working days.

Besides this, NEFT was not operational on the 2nd and the 4th Saturday of the week. The central Indian bank had commented, “in order to facilitate smooth settlement of these transactions in the accounts of the banks maintained with RBI, it has been decided that the Reserve Bank will extend the collateralised liquidity support, which is currently available till 7.45 pm on NEFT working days, round the clock.

Motivate Digital Transaction

When an individual initiates the transfer of funds, the same is reflected in the recipient’s account within hours. No restrictions are there on the minimum or maximum amount on the funds to be transferred.

However, they could be some amount of restrictions, on individual banks on the per transaction sum. In this regard to motivate digital transactions, RBI had presented a proposal on the anniversary of demonetisation. FASTags has been proposed by the central which would permit customers to pay for parking fee as well as at the fuel station.

 Due to digital payments, a high of 96% of overall non-cash retail payment had been established during October 2018 to September 2019. The National Electronic Funds Transfer – NEFT together with Unified Payments Interface UPI system, at the same time had managed 252 crores and 874 crores transactions with a yearly growth of around 20% and 263% respectively.

Acceptance Development Fund

The central bank had mentioned in a statement that `this rapid growth in the payment system, inter-alia had been facilitated by a series of measures taken by the Reserve Bank of India. To empower it further every citizen with an “Exceptional (e) Payment experience” and provide her access to a bouquet of options, the RBI said it proposes to “mandate banks not to charge savings bank account customers for online transactions in the NEFT system with effect from January 2020”.

Its intentions are to make operational the Acceptance Development Fund in order to enhance the acceptance infrastructure from January 1, 2020. In order to assess the requirements for group of QR codes together with merits of their co-existence or merging from the systemic and consumer point of view, a committee would be formed.

Moreover the central bank intends to enable all authorised payment systems and instruments (non-bank PPIs, UPI and cards, to connect with National Electronic Toll Collection NETC FASTags. As per the statement, it is mentioned that `going forward, this will facilitate the use of FASTags for parking, fuel etc., payments in an interoperable environment.’

Development of Synergies

This announcement from RBI had come up on the third anniversary of the significant resolution of the government for demonetising Rs 500/1,000. It was on November 8, 2016, that Rs 500 & 1,000 which were in circulation had been banned with RBI coming up with new currency notes of 2,000 and 500 respectively.

Moreover Reserve Bank of India mentioned that the benchmarking application taken portrays great position appreciated by the country in numerous factors with regards to payment systems. The banking regulator mentioned that it simplified RuPay card acceptance in Bhutan.

This would enable the activity with the payment system regulators in the other jurisdictions. Moreover it would also share its knowledge in the development of synergies thereby reducing the time and the cost in inward remittances, particularly in maintransmittal corridors.

Increase Digital Payment

According to the Founder and VP of Sarvatra Technologies, Mandar Agashe, the abandonment of charges on the online transaction namely RTGS and NEFT, makes it obvious that RBI is pushing the bank on increasing digital payment. This initiative would particularly benefit small traders marketing in small value transaction and functioning on small margins.

For these traders, the transaction would be of great importance to them. Besides this, RTGS and NEFTtend to be economical in comparison to the other modes of payment. For instance cheques involve end to end management for transaction till its ultimate settlement.