We all have had those moments when you are sure your financial resources have been stolen somehow. You just cannot believe or worse, even account for some of the “debits” occurring on your monthly or quarterly financial statements.
You can keep track of your finances by paying attention to three critical areas in the culture of earning and spending:
1. Be Aware Of Your Income.
It sounds like a no-brainer, but, you have to be very conscious of your income. You need to see the feasibility of spending out of your income and not leaving it to chance. Monitor your income over an extended period, and see for yourself, what you have to save and spend. Did you know how I said “save and spend” and not “spend and save.” Yes, that wasn’t a mistake. Remember; always spend what’s left after you put out savings, not save what’s left after you use.
2. Hold The Leash On Your Expenses.
You see, it is easy to want what you see. And frankly, you might be able to pay for it, but can you “afford” it though. Paying for something and being able to afford it sadly isn’t the same. Remember that you spend more during festivities, so you might want to make room for that. When taking stock of things, including all, do not leave out the “little expenditures” on gum and eating out. These tend to add up over time and reveal significant figures.
3. Watch What You Spend On Other Peoples “Happiness.”
It is important. It is easy to get Dani and Mary a dishwasher for their wedding anniversary. However, if you cannot afford it, you shouldn’t be getting it to impress anyone. And please, do not spend on others digging deep into your credit card; this is a mistake you must never make.
With regards to expenses, you should remember that one surefire way to keep yourself in check is to “pay yourself” monthly from your salary. There is nothing more restraining that working on a budget, in your budget. Spending is a habit, and like many other traits in your personality, it takes time to get rid of it. So, don’t let yourself sink too deep into a spending habit that only ensures you are receiving reminders often from your credit card providers.
Let me tell you, if you track your spending for two to three years, you will be amazed as to how easy it is to understand your spending and how much easier it is to manage your finances. When you can do this successfully, you can now take significant steps towards living within your means and ensuring that you are never in the wanting for credit debts.
Setting a personal accounting system that works for you isn’t quite complicated; however, you must put in the work. It can be difficult because you are trying to be objective about yourself. That is no easy feat, my friend. You are almost superhuman if you can achieve this.
I would say ultimately; you should look to have more savings as your income grows. It will enable you to see more funds for investment. And investments are the best way to attain real financial security for the long haul.