4 steps to get your money under control

Do you control your money? Is it working for you? You ever have more month than money? It happens. But wouldn’t it be nice to relieve some of that stress? It’s time to tame the beast and get your money under control. There are only 2 ways to have more money; Earning more and saving more.

Track your spending.

No idea where it all goes? Save all your receipts for a month and track it. Just toss them in a box or file folder. At the end of the month go back through them and add them up. Use headings like Household, Car, Bills, and Miscellaneous. You may be surprised at how much you spend at Starbucks or on your favorite Facebook game. If a box of receipts is too much to keep together, get a notebook and write down the amount and what it was for every time you spend. Receipts are helpful for tracking what you’re spending, but it is easy to lose so many random pieces of paper. Either way you go about it, keep a detailed list of where your money is going. This will also make the next step easier.

Budget.

Yes, everyone hates making a budget, but you have to tame the beast. A budget lets you know exactly where your money is going and puts you in control. It’s a clear picture of what’s coming in and where it’s going when it leaves. A failure to plan is a plan to fail. Especially when it comes to your money.

Pay your bills first.

Before you go out to eat or buy anything new make sure your bills are paid first. Is McDonald’s really worth being late on your rent for?  Avoid paying overdraft or late fees at all costs. These are by far the biggest wastes of your money. The average overdraft fee is $30 and a lot of places reserve the right to charge an extra $25 for insufficient funds. That equals $55 that could have stayed in your pocket with some minimal planning. There is a difference between being broke and having no extra after your bills are paid.

Get an emergency fund.

Everyone should have enough to cover 3-6 months of bills set aside. This is not an emergency Frappuccino fund. This is to make life’s emergencies not so hurtful. If your car breaks down you won’t have to choose between getting it fixed or paying the rent. If you have a sudden income loss due to illness or injury then you have 3-6 months to recoup. The more money in this fund the better. If you can’t just ignore its existence then put it somewhere that can’t be accessed easily.

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