Welcome to a new blog series where I answer the internets most popular questions about money! Money is a tricky thing to understand; so I will do my best to be thorough and answer in an easy to understand way! Please let me know in the comments on this post if the information is helpful, and feel free to ask any questions! Let's jump into it.
Question 1. "How Do I Save More Money?"
Short Answer: Budgeting
Do you follow a monthly budget?
Yes.
No.
No, but I want to learn how to!
Long Answer: Budgeting is a very common thing people should utilize. Running into the issue of ending the month with no money left over and not much to show for it is difficult. One of the easiest ways to follow your money, is to budget. This is the most popular form of tracking your monthly spending and I'll say it's been HUGE for me with my finances. Here is an example:
I recently purchased a house about 9 months ago. This is my first property and I'd like to say it's been great, but there have been many challenges. The house is older and needs some things fixed. I knew that it would take time and money to make it a more desirable place to live, but I did not understand all of the added expenses of owning a property. One of the more recent expenses that I was not planning for is our electricity bill increase by 24% since January 1st. There are not a lot of options for electricity in the area I live, and so I have to bite the bullet and pay more money. This is all something that I will adjust into my budget to better track. Now if I was living on a fixed expense this money would have to come from somewhere else, via spending less on say eating out or clothing. I'm not going to be able to make more money, so I will need to move money around from what I am already making to account for this increase in the bill.
This is why budgeting is the best way to understand what your money is doing for you. If you are able to cut back and spend less money, that is the best way to save. You will not naturally spend less money. Our world is one of accumulation and greed. We all want more, nicer things. If we aren't careful we will spend insane amounts out of emotion. In financial counseling we talk about these emotional spending trips that cost us a lot of money we don't have.
All in all, spending money is key in life, but knowing what you are spending and how much is key to saving. Seeing you savings account rise after putting in some hard work throughout the month to track where your money is going and not overspend is key. If saving was easy we would all do it. If you'd like to talk about your spending habits, or learn more about savings please reach out! We cover this stuff in financial counseling all the time and talking about it is always the first step. Saving all comes down to self control and understanding your individual situation. If you need accountability, I'm here. If you can go it alone, that's great! Stay dedicated and on track and let me know in the comments how you were able to do it!
Thank you for reading this, I hope it was helpful for you! As always, if you're struggling with money problems and aren't sure where to turn, please schedule a free consultation call with me and we can go over what the problems are, and find solutions to fix them! I'm always here to talk.
Spencer Dunbar
Financial Counselor
