One of the first steps to living within my budget is to figure out how much I've been spending each month. And the best way to do that is to track what's going out. Once I had a clear sense of where my money is going, I then can found places where I can cut back or just get a reality check on how much I spend on, say, that daily latte at your "special coffee store".
Here's is what I did to make my money map:
Start with your fixed expenses. What do you pay each month for your rent or mortgage, car, health club, insurance, utilities, phone service, cable, preexisting credit card debt, student loans, etc.? Make a list of these amounts.
Then track your variable expense. Most people have no idea how much they spend each month on things like take-out food/drive-thru, movies, drinks with friends, online shopping too, even gasoline and groceries.
Starting now, you're going to keep tabs. Every day, for the next month, you're going to get a receipt for everything you buy, even the small ones. If you buy something, that means printing out a record so you can account for that as well.
If you shop on the phone, make a note. Then, every night when you get home, spend five minutes pulling those receipts out of your wallet and entering them into a journal or jotting them down, category by category.
At the end of the month, you'll have a money map. You'll know how much you're spending, and on what. And then you'll be able to make some changes (and perhaps even spare your "special Coffee Drinks").
To be honest after a few weeks, if I was at the store and going to purchase something I knew I was going to have to come home and write it down in my Money Journal. Sometimes THAT alone stopped me from making that purchase. : ) Saved some money!
By Tracey from Michigan
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