Personal finance is not an issue you should be forced to face when in a crisis like so many people end up doing. Your personal finances are vital for your life, security and prosperity. Face it and don't hide your financial issues under the rug. Learn and practice personal budgeting. Create your own financial destiny and your life will be so much better.

Youll have to

• know your current personal financial situation
• estimate how your financial situation will develop in a short term perspective
• set long term financial goals, make a plan to achieve them and then execute your plan.

Get a view of your current financial situation

Collect accurate information about your personal financial situation. Calculate your your net worth, This information includes:

• real estate
• saving and retirement accounts
• stocks and bonds
• all other assets.

What is the total? Are you surprised?

Make a budget

A personal budget is information made up of your income and expenses and the more accurate this information is, the more likely you are to be able to meet your goals and realize your dreams. An income/expenses budget should be made for at most one year at a time and include a list of your monthly expenses. All expenses must be included. To be sure of that go through all your paid bills, check register and credit card receipts to find expenditures that recur every month and expenditures that happen less frequently. Divide that total by twelve and you have your monthly average expenses. To be able to make good personal financial decisions and set priorities, you must know where your money is actually going.

Get electronic bill pay

This is a very convenient way to pay your bills. You pay them electronically, by direct withdrawal from your bank account. The transaction is processed immediately. You can even link your bill pay service to your budget, so that your expenditures are automatically entered in the appropriate category. Personal financial management can be really easy, don't you think? Check out programs for enabling this on the internet

Make an investment and finance plan

Now that the fundamental state of your personal financial security has been established, the time has come for the more prosperous part of your personal financial life. What I mean is

• investments
• retirement planning
• loan shopping
• other ways to build a fortune.

You need to make a plan of what you really want in life that money can buy. Then you must find out how to get the money it takes to finance it and finally start to implement this plan. This is the long term part of your financial life - the process of personal financial development from the state you are in right now - to the state you want to be in. This journey toward financial freedom is in my opinion the most interesting and exciting part of personal financing you can have.