I Wasn't Paying Attention: Where Does My Money Go and How Can I Get Some Back? - Part 2

Written by Janet L. Hall


- I Wasn't Paying Attention: Where Does My Money Go and How Can I Get Some Back? - Part 2 by: Janet L. Hall

Hopefully, after keeping a daily or monthly log of expenditures, you’ve begun to notice your pattern of spending habits. You should be able to see where all your money is going and not just wondering. You should now be able to look at what you can cut out or cut back on.

Why do you need to do this * OverHall *?

Several good reasons could be if you’re having troubles making ends meet, living from paycheck to paycheck, or don’t have any money in reserve for unexpected emergencies. Other reasons could be that you want to buy a home, take a vacation, buy new equipment for your business, go to college or send your children to college. Still other reasons could be that you're self-employed and you need to save or invest for your retirement.

Let’s get started by making two lists, one for your NEEDS and one for your WANTS.

What’srepparttar difference?

Let me give you an example of how I see NEEDS vs. WANTS.

A NEED is something that you NEED to survive such as food, shelter, and clothing.

A WANT is something you desire. Something that you might already own, but you WANT another or a new one such as shoes, or a jacket, or a car. A WANT can also be something that you don’t currently have. As humans, we all have unlimited wants, therefore we must make choices. In economics this is referred to as * opportunity cost *,repparttar 112783 highest-valued, next-best alternative that must be sacrificed to attain something or to satisfy a want. Some refer to this as a trade off.

Now you need to ask yourself how much you are willing to spend or need to spend on your needs to survive and are you spending too much? Do your clothes have to be new, with big name labels? Does your home have to be nearrepparttar 112784 water with a hot tub and a swimming pool? Does your food have to berepparttar 112785 best cut of meat or dining at fancy restaurants every night? You getrepparttar 112786 idea?

What about your WANTS? What are you willing to trade off to make your WANTS a reality?

Let’s look for a minute of a WANT of a vacation to Alaska.

You will need to take some actions and ask yourself, possibly, some hard questions, and make some hard decisions.

~~ Do you have to save for this and how will you save?

~~ What steps must you take to estimaterepparttar 112787 cost of such a vacation AND what steps will or can you take to save forrepparttar 112788 trip?

~~ How long do you want to vacation?

~~ How will you travel and what are those costs? Planes, Trains, Automobiles? Hike, Bike, Cruise ship?

~~ Where will you stay and what are those costs? Hotel, Motel, Inn? B&B, Igloo, Tent? Friend, Relative, Friend of a Friend?

~~ How will you eat and what are those costs? Bring or buy food there? Eat out? Skip some meals?

~~ Do you need to purchase * special * clothes? Where can you purchase? How much will that cost?

~~ When do you want to vacation in Alaska? Now, next year, five years, or ten years?

Once you findrepparttar 112789 estimated answers to those questions you’ll need to look at how much you need to save and where in your daily expenses can you cut back.

TIP: Use this type of exercise for any wants you have for your life and business. You’ll discover if you can really turn your wants into reality, if they are realistic and feasible.

Top 10 Tips for * OverHalling * Your Purchases 1. Plan, plan, plan ahead 2. Don’t pay retail 3. Shop at thrift stores, consignment shops, secondhand boutiques, warehouses, or inrepparttar 112790 slightly damaged department. 4. Get in a co-op or collectively buy with others 5. Don’t shop with your emotions, use your conscience when shopping 6. Rent big ticket items when possible (for instance, if you need to fold 10,000 documents on a quarterly basis or use a saw-zall once a year) 7. Userepparttar 112791 library 8. Barter 9. Comparison-shop for EVEYTHING! 10. Don’t buy because it’s on sale or because you have a coupon

I Wasn't Paying Attention: Where Does My Money Go and How Can I Get Some Back? - Part 1

Written by Janet L. Hall


I Wasn't Paying Attention: Where Does My Money Go and How Can I Get Some Back? - Part 1 by: Janet L. Hall

Tracking, planning, and * overhalling * your hard earned money can help you reach any financial goals that you have, help you in getting out of debt, and help you gain back control of your money, your future, and your life.

Dawn Rivers Baker of WAHM & Mompreneur has a great series, * Financial Management 101 * ( http://www.wahm- mompreneur.com/finmanage.html ) in which she writes, * Managing cash flow isrepparttar simple matter of projecting cash receipts and needed cash outlays within a certain period of time - a week, a month, a quarter, a year - ... Good cash management consists very basically of three things: knowing when you need money, knowing where that money is going to come from and knowing where you can get money from if you fall short. With good cash management, you may find yourself with a bit of money left over when you have paid your bills. *

To assist you, in this often overlooked area of one’s life, I have found several generic cash flow/budget worksheets on repparttar 112782 Internet, one in which you can enter your figures and it will calculate everything for you. I have listed those links at repparttar 112783 end of this article, but please keep reading before bouncing over to them! Just remember that these worksheets are generic and it is up to you to customize them to your lifestyle and habits.

Listed below arerepparttar 112784 percentages (based on net spendable income, after tithing and taxes), according to Larry Burkett (http://www.cfcministry.org ), that you should ONLY be spending in each category of your budget:

Housing - 38% Food - 12% Automobile(s) - 15% Insurance - 5% Debts - 5% Entertainment & Recreation - 5% Clothing - 5% Savings - 5% Medical Expenses - 5% Miscellaneous - 5% To meetrepparttar 112785 8% that you should allocate for school/child care, if needed, you will have to make adjustments ofrepparttar 112786 above categories by an equal amount.

To have a true sense of where you're spending your money daily, keep a daily expense log for at least one month. Enter in everything that you purchase DAILY! Even that .25 cent pack of gum or mints. Get a little notebook that you keep with you and just do IT! This will allow you to see where you can cut back and/or start saving.

For instance, if you buy a newspaper everyday at .50 cents a pop, and a $1 forrepparttar 112787 Sunday paper, you've just spent $208 for a year of reading what? DO you readrepparttar 112788 whole paper or justrepparttar 112789 home or sports section?

If you readrepparttar 112790 paper at home, does it start to pile up causing more clutter and more of your time to dispose of it?

Where else can you get this SAME information? Maybe on repparttar 112791 Internet (if you're reading this, you are probably already paying for Internet service). Atrepparttar 112792 library? Can you read your co-workers? Do you also watchrepparttar 112793 television news?

How important is it for you to readrepparttar 112794 newspaper everyday and see $208 go out of YOUR pocket every year?

How much * bad * news do you really want to read and listen to everyday? Be selective! Remember how much your time is worth!

This and your other daily habits are what I want you to take a STRONG look at and see what you can * OverHall and Balance *, see what you are willing to give up, what you don't really need, or what costly habit you can change or cut back.

Cont'd on page 2 ==>
 
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