Why You Should Treat Your Household Income Like a Business.

Do you manage your household finances in the same way you would manage your business finances?   Stop and think for a minute. If you understand how your hard earned income is spent, you are in a better position to improve your household budget surplus (or in a lot of cases actually create a surplus).   Financial management is an important aspect of most successful businesses and you can apply the same rules to your household. Having some ground rules for your household finances will go a long way towards helping you create financial soundness.   Many people think and act logically in business, but defy logic in the household setting. At the end of the day, it’s how you use money in the household that creates your financial stability now and into the future. So, treat your household like a business!   Just as businesses do, so do households have revenue (your income) and costs (bills). A household requires healthy cash flow and optimal allocation of resources over time, and has assets and liabilities which must be taken into account when planning one’s personal finances.   The most common omission in the management of household business activity is the omission of a plan.   Personal finance planning is the only way to ensure that the correct things are being done to run the household as an expanding, profitable enterprise. Yet, the vast majority of Australian households do not have a plan, and this is evident with the high levels of unsustainable debt which ultimately impacts one’s ability to create wealth.   You don't have to go down the wrong path. Why not review your personal finance planning, apply the basic natural laws of business to your household, and grow your financial resources to achieve your life goals?   A couple of tips to get started are:  
  • Spend less than you earn
  • Have a cash flow plan
  • Reduce your consumer debt (credit card debt, hire purchase arrangements etc)
  • Set a financial goal(s)
The more you apply sound business practices to your household, the more financially secure you and your family will be. I'm more than happy to answer your questions, just click here to send me an email<

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