How to Control Your Spending

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By dasbootjoe
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Control Your Spending

Finances include spending, savings, and retirement. If you need to get a hold of your finances this article is for you. I will explain how to get your finances organized and to live a better financial life!

Difficulty: Moderate

Instructions

Things You'll Need:

Money
Time
Motivation

Step 1

During these “tough economic times”, it is essential to create a budget plan. If you are one of those people who says “where did my money go!?!”, then you should set-up a budget. A budget can be complex with graphs and charts or it can be as simple as writing down everything you buy. When I say everything I do mean everything. That $2 cup of coffee is an expense and needs to be documented. You can read my article about setting up a budget by clicking the link at the end of this article. You can also send me a message and I will send you my “budget plan template” that I created.
Step 2

Get a hold of your expenses. Buy yourself a small notebook and bring it with you wherever you go. Write down everything you buy and at the end of the day, enter your purchases into an excel file. After about one month of doing this, see where you are spending your money. If you spend $60.00 a month ($720.00 a year) on coffee you might want to think about buying coffee at the grocery store and making it yourself. The bottom line is you need to make sure you know where you are spending money. Once you do this you will have a better financial life….
Step 3

If you need to use your credit card, you can’t afford the purchase! Setup a high-interest savings account for medium and large purchases. Add a percentage of your income to this account every month and save for your bigger purchases. When and only when, you have enough money saved, go ahead and buy the item(s). For example, if you are looking to purchase a TV and a couch; save for both. Put the money into your savings account and use it when you have enough money saved. You can also charge the purchase and pay off your credit card right away. This will show activity on your card which will improve your credit score. Having the money saved will let you pay off the purchase right away and you will avoid high finance charges.
Step 4

Save for retirement and forget about it! Use your company’s 401k plan. If your company matches your contribution then add as much as possible. If you have 15 – 20 years before you retire, this is a great time to invest. Let your money work for you. You can also set up an IRA. You can open a Traditional or Roth IRA. Have all of your retirement money automatically deducted from your check as if it’s insurance or taxes. You will never miss it if you do it this way.
Step 5

Live the frugal way! If you live below your means, you will not be financial “strapped” come a recession. If prices (food, gas, ect.) go up, you will be able to compensate because you have been living below your means. NOTE: I know this is not easy to do but you will be happy you did in the future.
Step 6

By following these steps, you can live a great financial life! Remember the following: Budget to save, save to Retire!