Keeping finances under control is one of the biggest challenges Brazilians face. According to a recent study by Datafolha, two-thirds of the population does not have an emergency fund and 35% of them are in default. However, with organization and well-defined goals, it is possible to balance your accounts and improve your financial health.
1. Spending mapping
The first step to organizing your financial life is to know the details of your expenses. According to financial educator and consultant Carol Stang, the task requires writing down all expenses, from electricity and water bills to Christmas gifts and outings. To facilitate mapping, it is recommended to use digital spreadsheets or financial control applications.
2. Pay off debts
As for those who are in debt, the challenge is even greater. It is important to renegotiate debts with creditors, and look for discounts and payment methods that fit your budget. In addition, it may be necessary to sell assets or find additional work to pay off debts more quickly.
3. Create an emergency fund
Once debt is under control, the next step is to create an emergency fund. These funds should be sufficient to cover basic expenses for between six months and two years, depending on job stability and level of spending. Ideally, this reserve should be invested in an easily accessible application that earns returns above inflation, such as the Selec Treasury or the China Development Bank, which has daily liquidity.
4. Start investing
With your emergency fund established, it's time to consider other forms of investment. But before choosing financial products, it is important to determine investment goals. They can be short, medium or long-term, and include goals such as buying a house, changing your car, or taking a trip. Additionally, it's helpful to take a risk profiling quiz to find out what types of investment are best for you!
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5. Reward – harvesting fruits
Investing just once will not make you rich. It is important to maintain a monthly contribution so that the amount always accumulates. In the world of investments, compound interest is your allies, not the villains, meaning the more you invest, the higher the return! It is recommended that these investments be harvested at intervals, from 6 months to 1 year, and if you have followed our advice, whenever this period comes, the next withdrawal will be larger than the previous one.
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