Keeping our personal finances under control is a fairly basic and fundamental requirement for all of us, and yet so many allow theirs to descend into chaos. It is easy to lecture others when we might not be familiar their own particular circumstances but there are some fairly simple rules of thumb which, if followed, should help us to keep our financial affairs on the straight and narrow.

Don’t Spend More Than You Earn

Seems simple, doesn’t it? But the bottom line when the object of the exercise is to maintain a positive balance is not to overspend. Better still, if you are able to actually spend less than you earn you will have money to save and invest. At the very least, only enter into credit arrangements when you know you are expecting reliable incoming payments to materialize imminently.

Prioritize Debts

If you do have a whole bunch of debts to settle then don’t just attend to them at random. Tax liability is invariably the first demand that needs to be met. Once that is done pay off the ones which incur the most interest before others. That way your level on indebtedness is kept down to a minimum.

Keep Money Back for Unforeseen Expenses

If you own your own home and urgent repairs need to be done which aren’t covered by the insurance, it is important that you have some savings which can be dipped into in an emergency. Build up a reserve pot by putting a little aside each and every payday.

Seek out Value

If you have the space and the items in question aren’t perishable or time-limited, buy everything for which you know you will have an ongoing need in bulk to take advantage of economies of scale.