Accounting skills are not something only Commerce students learn. Most of our students learn the subject at one time or the other. Whether you are enrolled in a B.Com, B.Com (Hons) or M.Com course, you will certainly learn the basics (and advanced concepts) of Accounting throughout your course. In fact, BBA and MBA students also learn a bit of Accounting (especially Managerial Accounting).

Of course, we teach the subject from the perspective of a business organisation. However, accounting skills come in handy every day – for budget management and for managing your personal finances smartly.

Here are some of the tips on how you can use your accounting skills to make your daily life better:

Improving Grades

Let’s start with academics – the most crucial aspect of a student’s life. Accounting skills can help college students analyse their grades from exams and assignments. By recording and summarising this data in a spreadsheet, it becomes easier to see which areas need improvement.

You can then focus more effort and time on these subjects or seek help from tutoring services.

Preparing a Budget

Commerce students are expected to be pros at budget management, and every household needs a budget to ensure spending remains within income limits. Overspending can lead to additional banking fees.

By preparing a budget and sticking to it, you can avoid an empty bank account at the end of the month. Accounting skills help you manage your expenses and make adequate savings.

Managing Spending

Personal finance is something where many students falter, especially in their freshman year (the first year of college). Picking up some accounting skills can help in effectively managing spending during your studies.

With various expenses like books, stationery, living costs, and tuition, it’s crucial to analyse your budget. By recording cash inflows and outflows in a spreadsheet, you can see if you’re spending more than you’re earning and adjust accordingly.

Making Smart Investments

Accounting skills can help you make wise financial investments. If you are doing a part-time job or have some money you can invest, you can start building a portfolio early.

By understanding profitability, debt ratios, and liquidity, you can evaluate your financial health, set financial goals, and make informed investment decisions. This ensures you invest your money wisely.

Tracking Your Financial Activities

Employers are always on the lookout for Commerce students with good accounting skills. You can show that you can be a good accountant by citing specific examples of how you track your daily financial activities and put your accounting skills into practice. This can increase your job prospects considerably.

Reconciliation of Your Debits and Credits

If you want to be an accountant later, you should start practising that your records match and there are no errors – right in college.

Reconciliation involves using receipts and checking bank statements to confirm that debits from your bank account match your spending. This helps maintain accurate financial records.

Planning for a Better Future

In today’s economic climate, planning for the future is essential. Whether it’s saving for education, buying a car or home, upskilling, marriage, children, or retirement, you must analyse and plan your finances.

By paying attention to your personal finances and maintaining them in top-notch condition, you can achieve your future goals – and have some money for rainy days.

Additional Tips for Using Accounting Skills in Everyday Life

We need to have some accounting skills for some of the most basic tasks we do every day, such as:

• Shopping for Groceries: When shopping for groceries, accounting skills help you track your spending and compare it with your budget. This prevents overspending and helps you make cost-effective choices.
• Paying Bills: You also use accounting skills to organise and track your bills. By keeping a record of due dates and amounts, you can ensure timely payments and avoid late fees.
• Balancing Your Accounts: Just like balancing a chequebook, using apps and digital tracking software can help you keep track of your spending and income. These tools incorporate core elements of accounting skills and make it easier to manage your finances.
• Handling Taxes: If you keep track of your expenses and income throughout the year, tax season becomes much easier. You’ll have all the necessary information ready, making the process less stressful (assuming you have taxable income already!).
• Project Planning: For projects like home improvements or vacations, accounting skills help you set a budget and stick to it. This prevents overspending and ensures you can afford these projects without financial strain.

Budget Management for Commerce Students

Commerce students can benefit greatly from learning budget management. By understanding how to create and follow a budget, students can manage their personal finances effectively.

Budget management helps in:

• setting financial goals,
• tracking expenses, and
• ensuring that spending does not exceed income.

College students who master budget management are better prepared for both personal and professional financial planning.

Personal Finance Tips for College Students

1. Create a Budget: Track your income and expenses to avoid overspending.
2. Limit Credit Card Use: Use credit cards wisely to avoid debt; pay balances in full each month.
3. Cook at Home: Save money by preparing meals instead of eating out.
4. Utilise Student Discounts: Take advantage of discounts on software, transportation, and entertainment.
5. Buy Used Textbooks: Save money by purchasing used books or renting them.
6. Build an Emergency Fund: Set aside money for unexpected expenses.
7. Work Part-Time: Gain experience and extra income through a part-time job.
8. Avoid Impulse Purchases: Think twice before making non-essential purchases.

Conclusion

Accounting skills are practical and can be applied to many areas of life. Whether it’s improving grades, managing expenses, making smart investments, or planning for the future, these skills make daily life easier.

Acquiring accounting skills not only helps in personal finance and budget management but also enhances career prospects for Commerce students, making them invaluable in both personal and professional life.