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during the year such as dividends, interest or any once off payments add them up and then add them to your difference total to create a new income figure.

Now list any yearly expenses you may have such as your car registration, rates, taxes, school fees etc. Add them up then subtract the result from your new income figure, which is now hopefully in the black.

After you have done all of this and if there is any money left over this is your savings.

If you are still in the red or want to increase your savings, you will either have to increase your income or find ways of reducing your expenses by cutting back on your spending.

It is important to have savings, especially when unexpected expenses or emergencies arise. Aim to have at least 10 to 15 per cent of your yearly income in your savings account in case such events occur.

If you are a good saver and manage to accumulate more than 15 per cent of your income look to find investments such as stocks or managed funds to increase your earnings. As your income and savings increase you could expand into property investment.

As soon as you have a budget in place and resolve to stick to it you are on the road to financial security and wealth creation. In addition knowing how to manage your money will give you surety and piece of mind you will always be able to meet your financial commitments, as well as plan for the future.

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