9 Reasons to Treat Your Household Finances Like a Business

There are many similarities between running a business and maintaining household finances. Both require constant updates and monitoring and both can leave you out in the cold and broke. Here are

1. Comparison Shop. (Get the Right Price) Shop around for the best price for the product or services you require to maintain your household. This increases your monthly household income and reduces expenses.

2. Reduce Expenses. Find ways to reduce expenses. Reducing expenses frees up money to pay for other items. Use coupons or shop at wholesales stores, have a yard sale or donate unused items to charity and write the amount off on your taxes.

3. Go above Break Even. Strive to go above the break even point. At the break even point your total monthly income equals your total monthly expenses including debt. Strive to rise above your break even point to eliminate debt and achieve your financial goals.

4. Create a Budget. (Personal Profit and Loss). Write a list of all of your monthly expenses and your monthly debts and write down you monthly net income. If you have any money left over use that to pay down your debts.

5. Take Action. Once you have identified the areas where you need to reduce expenses develop a plan to begin reducing them. This can be done by making small adjustments to your budget. Revise your budget after each major life change or event.

6. Pay Your Bills On Time. You will save money on late fees and improve your credit rating. It will also help you get approved for a loan. You can save a lot by paying your bills early. An early payment reduces your average daily balance and your finance charge. Always pay more than the monthly minimum payment.

7. Verify Statements. (Reconcile Statements) Verify all financial and creditor monthly statements to check for errors. Report errors immediately to reduce the impact to your account.

8. Monitor household supplies (Office Supplies) If your household supplies seem to need replacing often set limits on how much can be used or ration out supplies to change usage habits.

9. Create an Emergency Fund. (Petty Cash Fund) Use an emergency fund to buy small purchases or pay for unexpected expenses. By tracking small or unexpected expenses you will have greater control over all your expenses which can quickly add up.