Financial Assessment of Your Life
Have you ever tracked all your expenses for a single month? You can do this by getting all your receipts and writing down everything you spent money on - from utilities to fast food meals. If you're like most people, you found something shocking. Don't be embarrassed. It's better to catch bad spending habits now rather than later. There may come a time when you really need the extra money and you'll regret spending it all on a few items you didn't really need.
What's the next step? If you want to take a real financial assessment of your life, then take a closer look at each expense category to see which items can be reduced. You also need to list your long term goals and your short term goals, because that will motivate you to make needed changes.
Here are some helpful suggestions:
DO look at the little expenses. Some people think that $5.00 a week is nothing to worry about, but that's $260 a year - a large amount that can be put towards one of your goals.
DO consider eliminating a category. You can do without cable TV. You can bring your own lunch to work. You may not like it at first, but it's amazingly easy to get used to - even enjoyable. You'll have to try it to see what I mean.
DON'T eliminate every enjoyment or service. Have friends over for dinner and a game night instead of going out to dinner and a movie. Do a stay-cation this year versus a vacation. Find lower cost insurance or utilities. In other words, keep the expense category, but find a cheaper alternative.
DO check out The Tightwad Gazette. It has great suggestions for living a large life on a small budget.
DO save money! Remember, having a big savings account doesn't mean you're a miser sitting on a pile of unused cash. Your savings account has a purpose: it's your credit card replacement. Instead of paying interest, you'll be earning interest. All the fun "big" things you want should come out of savings, and all your emergency expenses should come out of savings. A savings account should be an active, lively, growing thing that's fed on your dreams and fewer trips to fast food restaurants.
DO list your goals. I can't stress this enough. This will help motivate you when everyone at work is talking about the last season of Lost. Put your goals on the refrigerator for everyone to see as a reminder of why you're eating oatmeal for breakfast instead of a value meal. Maybe your goal is to purchase a car. Maybe you want to pay your child's tuition. Is it a big European vacation or a cruise? Want to add that sunroom or pool? Write it down, pin it up, and don't forget it.
I hope this helps. Did you notice this had more DO's than DON'Ts? This is about making positive changes not about going without.
What's the next step? If you want to take a real financial assessment of your life, then take a closer look at each expense category to see which items can be reduced. You also need to list your long term goals and your short term goals, because that will motivate you to make needed changes.
Here are some helpful suggestions:
DO look at the little expenses. Some people think that $5.00 a week is nothing to worry about, but that's $260 a year - a large amount that can be put towards one of your goals.
DO consider eliminating a category. You can do without cable TV. You can bring your own lunch to work. You may not like it at first, but it's amazingly easy to get used to - even enjoyable. You'll have to try it to see what I mean.
DON'T eliminate every enjoyment or service. Have friends over for dinner and a game night instead of going out to dinner and a movie. Do a stay-cation this year versus a vacation. Find lower cost insurance or utilities. In other words, keep the expense category, but find a cheaper alternative.
DO check out The Tightwad Gazette. It has great suggestions for living a large life on a small budget.
DO save money! Remember, having a big savings account doesn't mean you're a miser sitting on a pile of unused cash. Your savings account has a purpose: it's your credit card replacement. Instead of paying interest, you'll be earning interest. All the fun "big" things you want should come out of savings, and all your emergency expenses should come out of savings. A savings account should be an active, lively, growing thing that's fed on your dreams and fewer trips to fast food restaurants.
DO list your goals. I can't stress this enough. This will help motivate you when everyone at work is talking about the last season of Lost. Put your goals on the refrigerator for everyone to see as a reminder of why you're eating oatmeal for breakfast instead of a value meal. Maybe your goal is to purchase a car. Maybe you want to pay your child's tuition. Is it a big European vacation or a cruise? Want to add that sunroom or pool? Write it down, pin it up, and don't forget it.
I hope this helps. Did you notice this had more DO's than DON'Ts? This is about making positive changes not about going without.
