What you have to understand is the way you spend your discretionary spending will go a long way in securing your future. Some of the things you should understand is when you get money, the first thing you have to do is to manage your financial obligations and when this is done, you will be left with discretionary money. It does not matter the much discretionary income you have, what you have to note is that the way you use the cash is vital. This is something that can be used to determine your financial future.
What you need to understand when you have money is there is a difference between obligation spending and discretionary spending. Obligation involves using money on things you cannot be able to ignore like food and bills. That being said, then you have to understand discretionary spending. You have to note that this involves spending money on things that you do not necessarily need. The purpose is to bring personal satisfaction.
You have to keep in mind when dealing with the discretionary income, then you have to note that this is money you need to spend wisely as it will help you in securing your future. One of the thing you can use the money for is to pay off debt. If you find you have extra money to spare, then the first thing you need to think of doing is to pay off the debts. You have to understand that you can start dealing with this by paying off debts with a high-interest rate.
What you should note is that the other thing you can do is investing the money. Some of the things you should note is that this is vital as it is something that will allow you to let the money work for you. Though taking a vacation is paramount, watching your money grow can give you satisfaction. Some of the things you should note is you need to think of getting retirement saving as this is something with great tax benefits.
Some of the things you should understand is when dealing with this, then you can be able to make use of the emergency funds. One thing you have to note is the difference between a minor financial setback and total financial ruin is the emergency funds. Some of the things you should understand is the much you set aside mainly depends on you financial expense. You need to understand when you look into your finances, it is best to have at least 6 months of expense money. This will aid you in case of an emergency.