Keeping track of your money?

[Tao 6,736]

So do you keep track of your money?  Watch what you spend.  Plan things days to week ahead? Or do you spend and not think and later regret it?   How to keep in line with your spending? Also, do you have any tips or notes you might want to share with others to help them if they ask? 

[Guest]

Let's start with a budget. There's a common method known as the 50/30/20 rule. That means 50% of your pay is goes to your mortgage/bills, 30% goes to your wants, and 20% to your savings. You do this with every check. Now for some people this may be harder to do since their mortgage/rent/bills  could take up more than 50%, so you will have to adjust the rule towards your own situation. Sometimes people will do more to save so they will do 50/10/40,  but again I don't know your situation.

Start by looking at your monthly income and necessities. After subtracting all your necessary expenses- start looking at how much you are spending in going out(like eating out, going out with friends, buying things that you don't really need) This is the area of the wants of your budget or the things you "enjoy" that you spend money on by choice. This area should be around 30%, but you can lower or raise it to whatever you'd like as long as it's manageable. If you are having a spending issue, start examining where the problem area is and make small goals of improving your spending habits there on a daily basis.

By going through the 50/30/20 rule, the remaining 20% should go to the future. So here you can put your savings, emergency funds, future down payment for a car, house, paying off credit card debt completely.

It's hard at first when you are new, but it gets easier over time as you learn to adapt and understand that this will help you long term to save money. This method also teaches you discipline as you have to learn to live within your means. Sometimes, you will get a period where your expenses will be higher as life throws things at you, but by actively being mindful of your money, you will feel better knowing that you are saving for the future.

As for impulse buys, stay away from the said item for about 1-2 weeks. Get your mind off of it by doing other things and see if it still comes up in your mind. If it does, then you can totally wait for a sale as you already waited enough time OR you can make a goal to set some money aside in your savings to purchase said item if you can afford it. If not, make a goal to get there step by step.

 

As for building up capital/investing, if you are in the USA, you can buy treasury notes, Series I and Series EE bonds,  through Treasury Direct straight from the government. They offer so many FREE learning materials, which I highly recommend. You can also start investing into the stock market with small stocks. Over time, you will amass a large volume of stocks/portfolio. Some investment brokerages that you join offer free learning materials/classes, so I recommend using everything they offer. You will make mistakes here and there, but since you starting you won't really feel it in your wallet too much. If you don't feel like learning, you can always get a broker/autobroker to manage it for you for a small annual fee or so. They will happily discuss you the terms in how to do so, but it's fairly simple.

Edited October 7, 2023 by StarlightNyars

[Misty Shadow 7,085]

I always keep track of my money. I only buy what I need most of the time and make sure to always earn money in savings every month. If I were to offer tips on how to save money, my tips would be that you have to manage it every single day and imagine yourself as running a business. Businesses are always looking for ways to cut costs and ensure that their revenue increases. You see a way to cut costs? Do it. There's a reason why I have a Tracfone and made changes to what I generally do on my days off.