You don’t have to be in debt in order to get better control of your finances. You also don’t have to learn the hard way — like I did when I became homeless and didn’t have a choice but look after every single penny (because some days one penny was all I had).
But you do have to really want to take charge of your money. That’s a key issue. You will have to take some time out in order to realize what your money situation is. This can be a little discouraging, and no one is forcing you to do it (not yet, anyway) so you need self-motivation to keep at it. But the good news is that keeping track of your money can be an easy to habit to keep.
How Much Money Do You Make?
Before you can find out how much you can safely spend, you need to find out how much money you make. This step is usually a lot easier to figure out than the next ones. Include all the money you expect to make at work in a month and any cash gifts you expect to get. If you regularly pick pennies off of the ground, add a couple more dollars to your year’s income (if it makes you feel better).
How Much Money Do You Spend?
This is the trickier step. You and everyone else in your household needs to be honest. Keep a spending journal for one week or one month (whichever works best for you). Write down where every penny goes. Every penny. This includes candy bars at the vending machines, newspapers, bus fare, movie rentals, anything. Try not to purposefully be frugal just because you’re finally keeping track of this stuff.
The Not-So-Secret Secret
The secret to taking charge of your money is to spend less than you make. That’s the overall goal, which can be really hard to do, considering the recession. But you can make it easier and less stressful on yourself by seeing where you can cut corners so you can somewhat afford food, gas and Prozac (giving to charity falls under Prozac). The key is to buy only what you need — not what you want. Soon, you will discover that all that you want is all that you need. (Is that the title of a U2 song…anyway…)
And don’t be afraid to ask for help. If you do happen to be in debt more than three zeroes deep, then you can ask for free or low-cost credit counseling or debt management. For Americans, the Federal Trade Commission and the Consumer Credit Counseling Service can give you loads of advice and help you find one of these free or low cost services.
Hope this helps.
(No Ratings Yet)
Loading ...
To be notified by email when there are new blog entries, 
