Engineer's Finance

What do you think of paying yourself first? Does it sound sensible? Do you do that? Have you thought about it? Did you ever realize that you should pay yourself first?

I hope You do pay for yourself first and then others. What I mean by pay yourself first is, if you have a budget as explained here then accordingly make investments or savings. Before paying any bills or debts make sure that you pay for yourself. If you don’t take care of yourself, it is highly possible that none might be interested in doing so. Continue reading →

How many of you think of budget? Do you think of budget as a means to attain the “Financial Goal”? Is it really worth doing a budget? Can you stick with your budget? These questions were always in my mind regarding budget. I have figured out that Budget indeed is a good way to attain the Financial Freedom.

Budget is derived from the French word bougette which means purse. It refers to a list of all planned expenses and revenues.

Here is a simple method to begin your budget. I use GNUCash for preparing my budget. It is a free tool that is available. It is always good if you can prepare a budget in a yearly basis. I am not successful yet in doing it. I prepare my budget based on monthly expenses and I would suggest you also to follow on similar lines rather than going for yearly budget. Let us start with simple steps. If you follow these simple steps then I am sure you can budget effectively. Continue reading →

Do you often shop? Do you spend more than your income? Are you habituated to spend more? Do you have an urge to spend often? If you have answered to either of the questions as “YES” then this is for you. Read on.

I was spending like crazy once I started earning. Before I was working, I hardly spent money. I used to always think how come I started spending too much. Then I figured the answer that I earn more so I spend more. If I don’t earn more won’t I spend that much? I really don’t know. I am used to spending these days I can hardly say anything about it. But I think the truth is most of us are spend thrifts. It is not a great sign for being financially free. Whenever I spend money I never bother much about anything else other than pleasing myself. It is just for an instant and later sometimes I repent for what I did (Buying a worthless DVD!). I was just looking at the things I did and was not so happy with myself. I decided to stop myself from doing such things and I am on my way successfully in achieving it. Continue reading →

I had a very bad habit of not caring much about my money. I used to spend money but never bothered to keep a track of it. I used to withdraw money from ATM and then spend it without much thought. Whenever I used to spend money, my only intension was to satisfy myself. I never bothered about the worth of the product that I purchased nor did I bother about the value of money. I know it is child like behavior, but I could not tell myself how to stop doing it.

One day I thought, I should keep track of my expenses. (Just out of blue). I know it is weird but I did that one month. I started noting down each and every rupee that I spent. Whenever I made big purchases, I made sure that I do it using the credit card only and started collecting those bills as well. I had written down about 12 pages of my expenditure for a month. It was a nightmare figuring out what I spent on and how much on each of them. It was one hell of a job. Continue reading →

I was asked a question regarding is it worth to buy insurance products coupled with the investment option. My answer was and is “NO”. I don’t like the idea of combining products. I prefer either to have insurance or investment and not both. I was thinking over this for a long time and here is my analysis towards it.

Insurance is a tool to leverage your risk and investment is a method of making your money work hard for you and it is risky you all know that. Now combining both the products means you are actually leveraging your risk by putting your money at risk. How can that happen? Does it make any sense? Most of them think it makes sense but according to me it is not a good option at all. Continue reading →