Finance is fun!

Financial knowledge is power. And freedom. And an absolute necessity.

Growing up I did not have the best examples when it comes to managing money and savings. Women depending on their husbands, or making really poor decisions because they did not fully understand the consequences of their actions. Some not-so-fun experiences made me promise myself to manage my own money like a hawk.

I chose a master education where finance was explained thoroughly and I keep learning every day.

My best tips so far:

1.??????Stocks = ownership (thank you Vera)

Make sure you own the stocks in your own company, or in the company you share with your partner. Protect and inform yourself. For example, I did not know that, because I’m married, my husband can claim half of my company in case of a divorce. When I told some of my friends who also have a company, they did not know this either. So invest in expertise and information when it comes to protecting your finances.

2.??????Don’t keep up with your neighbours debt

It’s tempting to buy stuff you don’t need to prove yourself (or your friends) that you can. But think twice before you make an expense. Do you need this? Does it have to be this luxurious and expensive or will a cheaper alternative meet your needs as well. Don’t base your own choices on those of anyone else.

3.??????Keep track

Set up a system to keep track of your finances. You have to know how much you earn, how much you’re spending monthly, how big your emergency fund is. It sounds logical, but when things aren’t too bright it feels more comfortable to ignore the problem. It won’t disappear by itself, it will only make things worse.

4.??????Automate as much as possible

If you have monthly bills, automate the payments. If you forget to pay a bill, you’ll end up paying interest rates. That’s money you worked for and can’t benefit from.

5.??????Have an emergency fund

I know there are many guidelines on how big your emergency fund needs to be, but do some thinking for yourself. How much money do you need when you stop making money today. Can you cut back in expenses? How quickly can you recover from a setback? Be honest with yourself and set up an emergency fund before making any other unnecessary expenses.?