Money management skills are important to learn in order to manage personal finances effectively. Effective money management includes budgeting, saving, investing and staying out of bad debt, yet sometimes people want to concentrate on just one area such as investing and they neglect the other important areas. In some ways, this is similar to people who want to lose weight but are seeking a magic weight-loss program, pill or new formula rather than committing to the proven method of eating balanced healthy meals and increasing exercise. There are many books and articles written about money management skills that a person can learn from without having to purchase an expensive money management program that may even end up being a scam.
Certainly, ethical financial experts can be of great help with specific money management tips to solve a certain problem relating to one's finances. But when it comes to general money management skills, these are basic things financial experts keep repeating in their books and articles. Reading articles and books in libraries or online and taking notes on each area of money management is a great way to learn the necessary skills to properly manage one's finances.
Learning how to set and keep to a budget is an important money management skill to master. Many people continue to spend money without having a budget and this can build credit card debt. Finding a money management workbook with explanations about creating a budget, room to write the budget and keep track of spending is an ideal way to learn about budgeting. Keeping to a budget can be empowering rather than limiting because one is choosing how to use money rather than remaining clueless to overspending and risking building up bad debt.
Understanding the difference between good and bad debt is one of the most important money management skills to learn from a good article or book. Basically, good debt is an investment in something that is expected to improve one's finances in the future, such as student loans to get education to get a better job or a mortgage in order to own real estate. Bad debt is consumer debt built by spending cash or credit cards foolishly. There are many articles and books written by financial experts that offer advice on how to stay out of debt as well as how to manage it.
Saving and investing can be complicated areas of personal finance, but there are basic money management skills that can be easily learned with a little research. Saving money is important and many financial experts advise people to build up a savings of six months to even a year of one's income to have in case of a financial emergency such as a job loss. Many money experts also advise that money shouldn't be invested until an emergency savings amount is accumulated first.