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Are your financials plans and goals on track? Have you been able to meet your financial obligations? What is your current financial situation? What about your retirement plan? What can be improved, and what steps and actions do you need to take to avoid this downturn? Here are some steps to manage your personal finances during this period.

Develop a Household budget

It is important to note that your personal budget will help you to see clearly and appreciate your financial situation and this is better in managing your money. You need to develop an itemized summary of expected income and expenses for a period of time which will allow you to track your spending patterns. Do you have a spending plan? Developing your household budget include gathering all your financial statement such as utility bills and bank statement etc., records of all your sources of income and monthly expenses such as groceries, utilities, entertainment, transportation, as well as everything you spend money on.

Understand your expenses (Fixed needs and Variable needs and Wants)

Can you list how much you spend in a month? Many people are not aware of the total amount of expenses they generate in a month. Do you keep track of your expenses? Do you keep receipts of your utilities, mobile phone credit and data, food etc. Your fixed expenses normally stay relatively the same each month and this include your internet service, rent, mortgage, car payments and so on. Variable expenses change from month to month and this include fuel expenses, groceries, and so on. Your wants are non-essential expenses like dinning out, entertainment etc.

Your total Income

Income is money that you receive whether earned, gifted or loaned to you. This may be a lump sum or received regularly through a job or allowance. It is important to appreciate your total expenses and subtract it from your total income for the month under consideration. A negative figure means you are spending more than you earn. Once you understand your expenses and income and have a firm understanding of the money coming in and out of your life, it’s time to take some additional steps to best manage your money.

Your debt Test

Are your debts under control? Take a text to work out and determine your level of debt and steps you can take to get back on track with your finances. If you are struggling to make your repayments on time, you need to look at all your debts and split them into priority debts, non-priority debts and debt emergencies. You need to keep the debts under control and work towards getting rid of it.

Develop your money management resources

Having a sound money management resources plan is the best way to get your financial life in order. This include the process of budgeting, saving, investing, spending or otherwise overseeing the capital usage of an individual. Managing your money like anything takes time to understand and improve on. To master it also takes commitment and a solid understanding of your financial situation. Everyone and anyone who ever took control of their finances went through this; and getting your financial life in order, sooner rather than later, is of utmost importance. List all the things that slow your financial progress and start putting measures in place to cause improvement.
 
Develop your Savings Plan

Did you have adequate savings prior to the COVID-19? Saving money is important because it helps to protest you in the event of a financial emergency. It is important to note that having a good savings plan is a better road map for your financial life. It is important to consider savings as a fixed item in your spending plan and you need to figure out how much you spend and keep track of all your expenses. Some strategies to help get your savings on track include: Paying yourself first, setting up standing orders on your account, establish your savings buckets and create an emergency fund.

The author, Andrews Ayiku is Coordinator, MBA Impact Entrepreneurship and Innovation at the University of Professional Studies Accra.