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Topics: Budgeting |
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| Get to Know Your Monthly Expenses & Budget Better |
Submitted by:
02/23/2009 12:03 PM
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With all that is going on in the economy, what better time to get my own economic situation in order. I decided to go through my monthly spending with a fine toothed comb to find out how much I really send each month and if there are any places where I can cut expenses out.
It was quite an awakening to see where my money is going each month. So I looked at the spending item by item to see if I could cut down anywhere and minimize the amount of money flowing out and amp up my savings.
The fixed items (rent, insurance, gym membership, phone) were about as low as they could be. But I realized I needed to reevaluate my cable needs and cut down on food, shopping & entertainment costs. 1st to go, Netflix--even at $7.99 a month it was wasted money. Instead I'd consider the library, borrowing from friends or just go without.
I set an actual budget for 1)dining out 2)entertainment and 3)shopping. To go easy on myself I decided to take my average spending over a couple months and try to cut 25%, figured that was a good place to start. And that 25% cut would go directly to my savings account.
I've read that in trying to stick to a budget it is a good idea to come up with goals so they you are working towards a goal instead of feeling like you are 'depriving' yourself for no reason. My 1 year goal is to save $5000 for my Roth IRA contributions and to save $750 to invest in a new piece of furniture - a serious goal and a rewarding goal that are now part of my money saving mantra. So, in a year I want to save $5750, which amounts to about $480/month. Which is doable if I cut out an extra $250/month in my current spending. But I wouldn't be able to do it without taking a really close look at my spending habits and adjusting my budget. |
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