You’re intelligent enough to know that one of the easiest steps to financial planning is to get an accurate picture of where your money goes. Simply keep track of your spending for a month. That’s right. Grab a notebook or create a spreadsheet and put in everything that you’ve spent money on. Be honest, don’t be ashamed and do it.
After you’ve created this thirty day personal finance ‘lookback’, ask yourself this question:
“Where can I find money so I can get out of debt, invest and build wealth?"
If your answer is, I’m already maximizing my investment opportunities, then congratulations!
But if your answer is, "I’m living paycheck to paycheck and I don’t have extra money", allow me to introduce you to some of your money ‘thieves’.
They include: the trendy and expensive breakfast drink and Danish from your corner coffee shop, the cocktails, wine or beer with co-workers after work, eating out for dinner, buying lunch everyday and going to the movies.
Your personal finance picture will look different from the example below, but let’s take a look at the following to get some ideas:
Let’s say you spend $160.00/month going out to eat for dinner. And you spend another $120.00/ month buying lunch. The fancy breakfast drink and Danish sucks another $100.00/month out of your wallet or purse and movies at the theatre with snacks cost about $30.00/month. The total of these items is $410.00/month.
I’m not telling you to eliminate these from your lifestyle. What I am suggesting is you cut these expenditures in half. Then you’ll have $205.00/month to double up on a credit card or loan payment or to start investing.
In his book Automatic Wealth, The 6 Steps to Financial Independence, Michael Masterson writes:
“ … you must get your hands on some amount of money and invest it immediately. Start with at least 10% of your gross income. If you don’t have that much cash, put away as much as you possibly can …the reason you want to start saving now, even if your income is small, is that you want to create the habit of saving …”
That’s great personal finance advice from a man who is a millionaire many times over.
So, what’s holding you back? Is it the fear of doing something new or different?
Financial planning doesn’t have to be frightening. And it will result in financial freedom.
How can I help you on your personal finance journey?
Own the power of your personal finances and retire a millionaire!
Marc Woolf
Blog Posts Copyright © Marc S. Woolf 2007 All rights reserved.
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