How to manage 5 million salary finances

How to Manage 5 Million Salary Finance, How Do You Do It?

How to Manage 5 Million Salary Finance – For some people, a salary of 5 million is not a high salary, especially for those of you who live in big cities, like Jakarta. A net income of 5 million can be said to be a mediocre income to meet daily needs.

However, a small salary is not an excuse for not being able to live properly and plan for the future. The main reason why your salary runs out quickly at the end of the month is because you can't manage your finances.

Well, if you are confused about how to manage the finances of a 5 million salary, you can refer to the tips below.

Also Read: Early Financial Freedom: How To Do It?

Managing Finances with a Salary of 5 Million

Low income is often the reason someone runs out of money at the end of the month. In fact, if you can manage your finances well, you can meet your needs and save money to plan for the future. Let's see tips for managing finances with a salary of 5 million.

#1 Use the 50/30/20 . Method

The 50/30/20 method is a method of managing finances by dividing your income into three categories, namely needs, wants, and savings. This method was popularized by Senator Elizabeth Warren in the book All Your Worth: The Ultimate Lifetime Money Plan.

quoted from, the 50/30/20 method is the ideal reference value. However, the application will depend on several factors such as nominal, number of dependents, lifestyle, and others. Here's how to calculate the 50/30/20 method with a salary of IDR 5 million.

If you have a salary of IDR 5 million, you can divide 50% from your income, which is IDR 2.5 million to meet your daily needs. This post consists of essential needs, such as food, utilities (electricity, water, transportation, etc.), installments, and others.

You can use 30% of your income, which is Rp. 1.5 million, for what you want, such as the cost of watching movies, buying clothes, eating out with friends, or other things that can be entertainment.

The rest, which is 20% of your income, you have to use to fill out a savings post. In this case, you must have an emergency fund, future savings, and investments. If you have more funds than your needs and wants, you can put it into a savings account. This post will be of great help to you in the future.

#2 Starts Thinking About Short-Term and Long-Term Needs

When you can meet your daily needs, you can think about your needs in the short term and long term. Make a list of your short-term goals, with the funds needed and don't forget to include the timeframe for realizing them. The same goes for your long term goals.

You must determine the priority scale of your needs. These needs can be in the form of preparation for the birth of a child, school fees for children, starting to pay a down payment on a house, buying transportation, and so on.

By thinking about these goals, you can plan for the future with the salary you have, you will also be more active in saving to fulfill it.

#3 Avoid Online Loans

Online loans can be a source of problems for your finances. Currently, many companies offer online loans with small interest and other benefits.

Money from online loans might be a solution when you really need money. However, it can also be a source of problems in the future.

Therefore, fulfilling savings posts and emergency funds is an important thing that you must do regardless of your salary every month. This will help you when you need money in the future.

#4 Start Expenditure Record

Keeping track of expenses is very important for managing your finances. By taking notes you can avoid unexpected expenses swelling and improve your expenses for the next month.

If you record all expenses, you can view and evaluate finances. You'll notice that there are some items that may not be very important to buy.

With this, you will avoid it and will not buy it again in the future. This is very effective in controlling your expenses every month.

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To record your expenses, you can use the Whiz financial application.. With this application, your expenses will be automatically recorded.

In addition, you can also save and make a tube to separate your types of savings. There are lots of other interesting features that you can use and are certainly useful for managing your finances.