Finances

Leadership comes in various shapes and sizes. Sometimes, it is necessary to start small. The habits learned on a small scale later translate into how you lead on a larger scale.

In this article, we will focus on one of the habits that will help you gain leadership skills, as well as benefit your personal life: managing your personal finances.

The saying “money makes the world go ‘round” is somewhat true, especially on an individual level. Managing your own finances is even more crucial for those who work from home or are self-employed.  By the end of this article, you should have a good idea how to follow basic principles of personal finance management, and learn how they can instill leadership qualities.

Budgeting

Budgeting is a key aspect to managing your personal finances. A good way to start making a budget is to carefully watch your spending habits, and then create a budget based on them. Apps like Mint are especially helpful in creating and editing a budget. While setting a budget for yourself is a good first step, following it is the difficult part. Sticking to your budget takes discipline and focus, both of which are essential leadership skills.

Goal Setting

Another similarity between leading and managing personal finances is goal setting. It’s important to have goals for your money, just as it is important to have goals as a leader. Having a goal makes it easier for you to stick to your budget and be disciplined with your spending.

Saving

Saving in your daily habits will ensure that you have some some spending money and extra money in times of emergencies. Some desirable habits include turning off fans and lights when not in use, using coupons, and looking for online deals before purchasing. The money saved from these habits will slowly add up. Before you know it, you will be cutting down significantly on your expenses.

Finances

Learning to save in such a manner will teach you to incorporate smaller chores into your daily lifestyle. In terms of leadership, this will teach you how to carry out less exciting activities as part of your routine. It will also teach you to remember the smaller or insignificant tasks you might have as a leader. Just as there are many different ways to save, there are many different ways to lead – it’s just a matter of finding the ones that suit you most.

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Long Term Planning

In terms of personal money management, you need to have a long a term plan so that you have enough money to live comfortably, even when you are not working. You may have to think about retirement plans, pension funds and insurance. If you work overseas or plan to retire in a country separate from where you currently work, make sure you are aware of your expat pension rights.

Retirement

It might be useful to have a financial advisor for investment options, so that you can make money as time goes by. It’s very easy to get caught up in the present with the hustle and bustle of everyday life.

However, it is important to always be thinking about the bigger picture so that you can actively work towards it. This way, money management is a good area within which to practice your leadership skills. Lessons from personal financial management can easily be applied to most leadership situations, and more importantly instill the basic qualities of a leader in you.

How Should a Leader Handle Their Finances?

If you have ideas that you feel like sharing that might be helpful to readers, share them in the comments section below. Thanks!

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Akshata Mehta
Akshata is a freelance writer who is interested in leadership, financial planning, and career development. She loves to read, travel, and try new foods and occasionally blogs about her daily doings.
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