To avoid bankruptcy, the main key is to be able to manage finances well. By being able to manage finances well, we can avoid bankruptcy when the economy is not good or when facing other problems related to finances. Managing finances is indeed not easy, there will be many temptations that make us not control our finances well, but believe me, if you do it continuously, you will get used to it. So it is important to apply financial management as early as possible.
For example, by recording income and expenses, this is the most difficult thing to do in personal finance.
An accountant alone is able to record company finances, but not necessarily able to record personal finances. Therefore, you must stick to the principle, if you work, work while others are sleeping. Save while others are shopping, study while others are partying, and enjoy life while they are dreaming.
All of that can be achieved if you make a mature spending plan and a clear monthly budget. Prioritize basic needs such as bills, food, and avoid debt. If you have extra money, set aside some of your income to save and invest for future targets.
Financial management is the most important thing for anyone who has a source of income that is still tight, especially those who are in a poor financial condition, indeed it is not something that can be easily done by someone, but if they do not want to go bankrupt, of course they must learn how to manage their income properly so as not to go bankrupt.
Choosing to record all forms of expenses that we have will indeed be very good and we can see whether we have used the income we have on things that we really need or not and if there are still expenses that we don't need, then we will be able to improve in the future so that we can limit all expenses that we don't need and that way one day we will be able to achieve what we dream of with the money we have collected.
When we have prioritized basic needs and are always routine in setting aside some of our income to invest, of course this will be able to prepare for the future according to what we expect, but this will not be easy to do if someone does not have good financial management.