3 signs that show you are successfully managing your money

If people were asked a question as to how they manage their money, most of them would claim that they are successful in managing their money. Knowing that you are financially secure is a great feeling as it brings peace of mind. But are you really successful at managing your money? Below are three signs to look out for.

1. Credit card balance payment nil at month end
To be successful at managing your money you have to be successful in managing your debt, specifically credit card debt. Often financial advisors ask people not to use a credit card. However, it is not the right approach. You can have a credit card, but only if you use it diligently. Have only one credit card or at max two and if you are currently maintaining it and making the credit card balance payment at the end of each month then it is a sign that you are successfully managing your money.

2. Have emergency fund
Emergency fund, as its name suggests, helps you fund your mandatory expenses in case of loss of income. People usually are very confident about their job, which is great. However, being overconfident is a sign of foolishness. So, for short-term emergencies, it is better to have an emergency fund in place. An emergency fund can be anywhere between 3 to 6 months of your expenses. This can’t be generalized. It depends upon you occupation. The more the risk of job loss, the bigger the emergency fund required. But if you are already having an emergency fund in place then you are definitely managing your money successfully.

3. Have a financial plan
Having a financial plan in place is one of the smartest moves. As a financial plan does not just speak about your financial goals but also about your overall personal finance. So, having a documented financial plan would help you to understand where you are currently, where you wish to head and how to reach your goals. In case you already have a financial plan then it is important to review it periodically. If you do so, then it may have made your task of managing money a lot easier.