Here is a quick summary to my 3 part budget series I have been posting. For quick reference, the links to the blogs will be at the end of each summary. Happy budgeting, and email us if you have any finance questions you have or want us to look into.
There are 3 spending habits I try to follow the best I can. I have watched countless videos and read numerous blogs about these topics. These are three things I try to live by and so do thousands if not millions of wealthy individuals.
- Track your spending! This is number 1 by far! I have wrote another blog on it before and it is the number one thing anyone can implement, when it comes to money. If you have a budget and you track what you are spending your money on, you will get an understanding of where you are putting your hard earned money. Review your spending every week and every month. Look at where you are spending your money and then categorize your expenses. Once you have this down, you can see how much money you are allocating to each section of your life. By tracking your spending, you can then start slashing your expenses, one at a time, to get to your goal expense amount. If you would like to know more about tracking spending, read this blog, The Perks of Tracking Spending.
- Hide your Money! As soon as you get your paycheck or income into your account. Transfer an amount or a percentage to an account you cannot easily access. This could be a high interest savings account, an investment account, 401k, trading account, etc. Put this money somewhere you cannot access it quickly and somewhere you usually do not look everyday. By using these techniques it makes you live on a lower income, while investing in your future. If you want to learn more about hiding money, read this blog, Why You Should Hide Your Money.
- Say NO to Instant Gratification! This is something we are all guilty of doing and it is the hardest thing on the list for me to follow. Say NO to instant gratification and compulsive buys. Only buy compulsively if it is something you need to have. If it is not something you need and it is just a want, wait 1 week to purchase the item. If after the one week, you feel it is still something you need or will bring you immense joy, then you can make the purchase, but only if you have the capabilities to pay for it in full! I am not saying you have to pay for it in full but I believe you must have the capabilities to do so (exceptions such as a home appliances). By doing this, it allows you to make calculated and thought out purchases, which will help your spending immensely. Click here to read more about Why Compulsive Buying is Bad.
I hope this helps!
Your Life Tutor