You’ve often heard the phrase, “a fool and his money are soon parted“. Unfortunately, it is true. Many people who do not keep track of their expenses usually end up spending what they earn, and by the end of the day, they are left with no savings.
Now, there’s nothing wrong with self-care and spending money every now and then but, if you are not aware of keeping your income and expenses in check, you’ll end up in the vicious cycle of wondering where it all went.
Keeping track of your money is not only helpful in saving, but it also helps you get a clear picture of your monthly expenses. Most of the time, people invest in things they rarely use, which can easily be dropped and result in more savings, such as a television subscription you no longer need or a grocery item you no longer use. Here are some tips to get you started on keeping track of your income.
1. Re-Evaluate Yourself
Before you jump in to make budget sheets, you need to understand the basics. First and foremost, you are going to look into the actual amount that you earn and how much of it goes into taxes and insurance.
These simple questions will put a lot into perspective. This is also where you take into account any income coming from investments, stocks, or a side gig.
2. Your Current Expenditure
Now, you are probably going to need to whip out a pen and paper because you’ll be listing down all the bills, payments, and miscellaneous places where your income goes. This can include your grocery, your bills, your subscriptions, and your outings.
Here you’ll have to be honest with yourself while jotting down your spending habits, even if they make you feel guilty.
3. Get Into Action
Now that you have a clear-cut picture of what your spending habits look like, you’ll easily be able to point out a few things you no longer need, or you can cut out. You can also contact your bank to open a savings account to keep a chunk of your money separate. Once that’s done, you should reorganize your budget. These simple measures will keep you updated with your income, and you’ll always know where you are spending.
Life is an experience, and we learn many things along the way, so don’t feel bad. If you haven’t started, you can start now. Remember, better late than never.