Spending money is in human nature, we live in a superficial and consumer-friendly world, it’s totally normal to love spending money. And a lot of times, money is there to be spent..but not every penny all at once! Learning how to handle your money and having a spending budget can be hard, especially for young people who are just starting to earn cash on their own. The truth is this isn’t taught in school, so a lot of people just go into it intuitively, but it can cause a lot of financial devastation in the long run. That’s why you need to know these practical ways you can monitor and assess your expenses!
Make a budget
You can never overspend if you have an exact amount of money to spend, right? A good tactic to learn how to handle your finances is to sort out how much you can spend on each segment – sort your spendings on groceries, rent, bills, clothes, necessities, or anything you deem important in your life. This is such a powerful method, not only will you know exactly how much you spent in a certain segment, but also it will surely prevent you from maxing out your credit card, it’s a win-win situation! And remember, always put a little bit of money in your savings, this is the key to your future! In order to be good at this, it takes practice, so don’t shame yourself if you fail the first time!
Get an app
Nowadays, technology truly has gifted us with amazing inventions that can save us time and energy! One of these inventions is an app that counts your taxes, tracks your spending habits so you can look at them later on and see what you spent most of your money on! Experts from keepertax.com state that a lot of people use apps these days, so why not give them something that is easy to use and is also a powerful tool! Why write stuff down, when you can get an app that’s connected to your bank account, let the app do the dirty work of tracking your payments while you simply observe it.
The traditional way
If you like paying with cash, you’ll run into some problems, especially because there are no other ways to track your spending, unless you keep all the receipts you got. Sometimes you just want to do all the work, and that is completely fine, a spread-sheet can do the trick totally! Don’t let it discourage you, it takes a bit of time to get used to, but if your parents and grandparents did it back in the day, so can you! Just do this as you go, try not to throw away the receipt, or at least try not to forget certain purchases, regardless of how small or how big – a purchase is a purchase at the end of the day!
Have two accounts
This is not as uncommon and crazy as you may think – a lot of people have multiple bank accounts at once. There is a simple logic behind it all, and it’s the fact that you can easily have one account just for necessities like bills and rent, but also on the other hand you’ll have an empty account ready to be filled with money that’s meant to be spent for clothes. Skincare, going out, or anything else! This can be limiting, but it’s a necessary evil that will actually save you a lot of money in the long run!
So if you and your partner are living in the same home and basically spend the same money, regardless if you are married yet or not – you both need to work together on your finances. In order to keep a good track record and to monitor the finances correctly, both of you need to be on the same page about those things! As that is the only thing that will make the budgeting way less hectic. Make a plan with your partner, maybe even open another account or at least make a reasonable budget for the two of you!
At the end of the day, if you ever want to reach a certain goal, you’ll need money, that’s just the rule of the game. So it’s up to you to be a responsible adult and not spending a lot of money on unnecessary things, this is a great step in the right direction! Even though there are so many temptations, so many new and shiny items are being made, you need to find a way to look past that and focus on yourself! It’s absolutely never too late to start, doesn’t matter if you are old or young!