Page 28 - January 2022 Issue
P. 28

 Tracking your expenditure allows you to see where you are going overboard and just where you are spending more money than you should. The process makes it less likely for you to fall for unnecessary expenditures.
The key step here is to track everything you spend for a month or two. This is the first step in the goal towards spending management. You can track your spending on an ongoing basis to maintain a hold on your spending. Keeping an eye on your expenses also allows you to write down everything you spend money on during a month to see where you went overboard later.
Make a Budget
Living on a budget might not be your definition of fun, but it is the best way to keep your spending under control and ensure that you are able to save money. Start by creating a budget, which is perhaps the easiest part of the process.
You can create a budget with elaborate details on how much goes towards fixed expenses, how much you plan to save and how much of your money you should devote to variable expenses. These optional expenses include dining out, groceries, and entertainment.
If you think creating a detailed budget isn't meant for you, you should simplify the process further with the 50-30-20 rule. The rule is simple and works on allocating 50 percent of what you earn on needs, 30 percent of what you earn on wants, and 20 percent to your savings.
This project can work like a charm and help you meet goals without elaborate budgets.
Consider Going Cash Only
You can make all the budgets in the world, but failure to stick to them and follow them will render all of them useless. One way to make sure that you remain within your budget and don't exceed your means is to move to a cash- only lifestyle. Do this for a while to see how results phase-out and the outcomes you get.
Switching to a cash-only system does come with a few benefits. Research suggests that people spend less when they do so with cash. As cash comes with a visceral experience, people can feel the money going out of their hands, which stops them from spending unnecessarily.
If you move to a cash-only system, make sure to start the month after subtracting all your savings from your total income. This will ensure that you only have the cash to spend on what you can afford.
Freeze All Credit Cards
Freezing all your credit cards can be an excellent way to put your spending under control. Avoiding credit cards is necessary for spending control, but you wouldn't want to rid yourself of your credit cards entirely, which is why the right way to go about this process is to freeze your cards.

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