Challenge Week 2: Slim Statements = Fat Pockets
Controlling your money flow starts with a good review of your spending habits. So back by popular demand, this week’s challenge is to review your debit and/or credit card transactions on your online statement or other spending records (i.e. check register, receipts) for the last few weeks. Then, write down the 2-3 things that you could have done without and answer our online poll. Here are a few examples to get your started:
• New sneakers
• Movie rentals
• New purse
• Eating lunch out
What’s the Difference Between a Want and a Need?
When reviewing your spending, consider the differences between real needs and wants. When you think about it, people really only need four things to survive: shelter; enough food and water to remain healthy; basic health care and hygiene items; and just enough clothing to remain comfortable and warm. Everything beyond that is a want. But let’s face it, few if any of us want to live that frugally. Never fear though, good money management doesn’t mean you have to deprive yourself of all the things you may desire. It’s about finding the right balance between what you want to spend your money on and what you can afford after you have taken care of your basic needs. Everyone has different goals and priorities, so what works for you may not work for someone else. Asking yourself some of these questions may help:
• What are the things that I never regret spending money on?
• What are the things that would be nice to have, but really are not that important to me?
• What are my fixed expenses each month such as rent, car payments, health and car insurance, or cell phone charges?
• Is there a way to decrease my fixed expenses each month (e.g., lower cost cell phone contract) so I have more money for saving and/or spending on the things I really enjoy?
• How can I reduce the amount I spend on groceries each week and still maintain a healthy diet?
• Are there ways to reduce my commuting costs (i.e. take the bus, ride-share)?
• What is the amount I can comfortably afford to spend each month on eating out and/or entertainment?
*Details and official rules here