How do I Become Better With Money?
- 1). Write down a list of regular expenses that you must pay monthly. These bills include rent or mortgage, phone, cable, Internet, utilities, life and car insurance and any other fixed monthly payments. Add these numbers up.
- 2). Write down a list of all necessities that you buy regularly, but whose totals change, including food, gas, clothing and consumables for your house. Keep track of these expenses for one month, so you that you will have a realistic estimation of what you spend.
- 3). Add up the amounts from the lists in Step 1 and Step 2. This is the total of your monthly expenses. Subtract this from your monthly income to see how much extra money you have.
- 4). Give yourself a monthly allowance. You may choose to break this down into weekly amounts. A good guideline is to put 75 percent of your extra income into a savings account. For example, if, after everything is paid, you have $400 left, put $300 into savings and give yourself $100 to spend on whatever you'd like. Just remember that once it's gone, you don't get anymore money for the rest of the month. Don't dig into the savings account, unless it's an emergency, such as a new tire for the car or a doctor's appointment.
- 5). Monitor your spending closely, advises the Money Management Tips website. You may not realize how much money you're actually spending. Write down everything you buy, whether it's coffee, soda or a quick snack. Spending just $5 a day on these items adds up to $150 a month. For most people, that is a significant amount of money. After seeing this number, you may choose to cut back on your spur-of-the-moment spending.