Money Management: How It May Affect Your Finances

Saving money concept

Spending money is fun, especially when it is used for purposes of entertainment and indulging. However, money wrongly spent pushes you closer or deeper into debt, regardless of the amount you have at a given time. Similarly, when you spend money wisely, you tend to increase its period of sustenance.

Saving Culture

People who have poor saving habits are often encouraged to consider opening a bank account. You no longer need to be physically present at the bank. From the comfort of your home, you can submit an online application for a bank account with reputable banks such as Patriot Bank. The same applies to completing transactions such as making payments for online orders. The emergence of online banking has resulted in criticism that people no longer have limited access to their money. In fact, they are now more likely to spend the money since they can place orders for various products from their phones. However, that is a misguided assumption. A majority of poor spenders tend to waste their money since they walk around with it in their wallets. It is, therefore, often an issue of seeing the money that creates the urge to spend it. The same may apply to people with credit cards. However, this has a solution since a cardholder may place a spending limit on their card.

Formal Channel of Payment

Woman withdrawing money from an atmHaving a bank account goes beyond just saving your money. It provides you with a formal way through which to receive payment. Consider a consultant working in any field without having a bank account. That would mean following the delivery of services, and the clients would have to withdraw cash from the bank to complete payment. The other option would be an open check. However, there are many companies that do not allow the physical transfer of money or the use of open checks, which they have found to encourage fraud. As such, pending payments are completed through wire transfers or bank to bank. At that point, it becomes essential for a person to have a bank account. Even when operating a business, consider opening a separate bank account. This allows for easier accountability.

Access to Credit

Every now and then, you may find yourself in an unfortunate financial situation, prompting the need to apply for a loan. Usually, banks and other lenders tend to be more lenient to their customers. That means that given two loan applicants, Applicant A and B, with the latter being a client with a given bank, they have a higher chance of securing a loan. It is not unusual to even find banks that impose lower interest rates on their existing customers in relation to new loan applicants. Having access to bank loans also eliminates the need to deal with shylocks who often provide financial relief at relatively high interest rates and shorter repayment periods.

Some people assume that the best way to increase their savings is increasing their income. However, that is not always the case. It is still possible to increase your income with no changes in the amount of money you save. It all comes down to proper money management.

About Eleanor Sharp
Eleanor Sharp is the author of AGSE Law. As a paralegal, she has worked with attorneys in many fields to ensure their clients get the best advice and representation. She is passionate about helping people understand the complexities of the legal system so they can make better decisions for themselves. Eleanor loves reading, travel, and spending time with her family. She hopes her articles will help others navigate life’s legal intricacies with confidence.