someone with a little monthly salary needs to be adept at handling money. Furthermore, while the source of revenue does not increase, the requirement for children's education costs keeps rising. In order to avoid being enticed to incur debt, especially for less critical secondary necessities, you must carefully manage your monthly salary.
The satisfaction of the basic needs and the pleasure of the family are not contingent on the amount of the paycheck. The management issue is the primary one. Even if some people make hundreds of millions of dollars a month, they still don't always complain.
Even with a salary of less than IDR 8 million, financial stability can be maintained if managed well. How is the monthly salary tip determined?
Use Salary Percentage Allocation
You can attempt the following monthly salary allocation example, which many economists suggest:- Housing 20%
- Savings 30%
- Insurance 8%
- Taxes 10%
With this arrangement, you won't have to worry about falling behind on your payments or accruing more debt—you can pay off the loan appropriately.
Use Formula 40-30-20
If the first point above's income distribution percentage pattern doesn't feel right for you or you can't adjust to it, you can attempt another formula: 40-30-20-10. What are the points from that percentage?- Set aside 40% of your income for living costs and regular monthly expenditures like groceries, utilities, credit, and so forth.
- Set aside 30% of your income for installment payments on obligations like auto loans, mortgages, and other bills. Make paying off the original loan your first priority; avoid taking on new debt until it has been settled.
- Set aside 20% of your pay for savings and investments. In this instance, it can be for the cost of the kids' future or immediate schooling.
Distinguishing Needs and Wants
A desire that is hard to discern from a need is what frequently keeps people in a cycle of debt. Check the amount of your monthly debt payment. This becomes a significant issue that needs to be given careful thought if the number increases. There will be more living expense allocations if the debt bill is pressed.Not what is desired is what is necessary. If you would like to be able to enjoy a higher monthly pay amount, then temporarily hold back on your appetite.
Taking a car as an example. Car A, which you already have, satisfies the requirements. But you have to switch from car A to car B with a higher payment amount since you want to see car B with a newer model.
Your bill will therefore increase even if your income source stays the same. Don't let it be the case that your final paycheck is insufficient to cover basic expenses; for instance, you may have unpaid car installments and the cost of your children's school, which has put you in arrears. This is where controlling necessities over wants comes into play.
Looking for Additional Income
Do you think your monthly wage allotment is beginning to fall short of your necessities? If you want to avoid debt, one way to do so is to locate additional income. If you work a full-time job, you can search for part-time business options that you can manage alongside your primary employment.You can locate numerous business options to help you pay for the additional living expenses. Couples with children in the family can even do this together. Financial issues in the family can be progressively resolved if you are sincere about it. in particular the quantity of debt that has accrued and needs to be paid off.
Give children's school expenses top priority
Certain monthly expenses, like tuition for children attending college, are critical and cannot be put off. The youngster may face consequences, such as missing one semester, if the semester fees are not paid. Your child's educational time will suffer as a result of this.What then is the remedy? Lending organizations for educational funds may be able to help with this issue. You can borrow from reputable lending organizations when you search for extra money for living needs.
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