http://www.automaticfinances.com/wheres-my-money/
If you're not taking control of your money, chances are you have no clue where it's all going.
Stop me if you've ever said one of these:
If you're not taking control of your money, chances are you have no clue where it's all going.
Stop me if you've ever said one of these:
How did my account balance get so low?
It doesn't feel like I bought so much stuff this month.
Why does my credit card bill keep getting higher?
The first step to properly managing your money is to know exactly where it's all going!
How to Budget Your Money
http://www.wikihow.com/Budget-Your-Money
Unless you budget your money, you're practically inviting unnecessary debt into your life, and making it impossible to save. These steps will help you figure out what money is supposed to go where so you can control your spending accordingly.
Create a budget every time you get money. For most people, this is once every two weeks. Sometimes it's weekly, sometimes it's monthly. Either way, it's a regular interval, and it's the best time to decide how you're going to spend your money.
Make it a rule that you don't spend any of your paycheck money until you've worked out your budget.
Make a list of all the things you'll need to pay for until the next paycheck, such as:
Rent/mortgage
Utilities
Vehicle payments, insurance, maintenance (e.g. oil changes, tire rotations)
Debt (credit card payments, student loans, doctor's bills)
Gas
Tuition, school supplies
Food/groceries
Health insurance
Anticipate how much you'll need to pay for each and write that amount next to the corresponding item on the list. You can also opt to pay for a fraction of something that isn't going to be due until after the next paycheck. For example, if your rent is $800 due on June 1, you just got paid $700 on May 12, and your next paycheck will be $700 on May 26, it may be wise to set aside $400 from this paycheck for rent so that you only need to take $400 out of your next paycheck to pay for rent.
Add up all of the amounts (we will call this your regular expenses) and subtract it from your paycheck amount. Do you get a negative number? Then you are living way beyond your means. If you have money leftover, split that money up into a few groups:
Flex money. This should be about 10-20% of your regular expenses. It's for if something you need to pay for turns out to be slightly more expensive than you anticipated. This can happen with utilities, or if gas prices suddenly go up, or you get a flat tire.
Savings. Ideally, this should be about 30% of your paycheck, although even 10% (if you do it consistently) is pretty good. Build up enough savings for an emergency fund (about 4-6 times your regular expenses), then start saving money to invest.
Spending money. This is whatever is leftover after you subtract flex money and savings money. It's what you'd spend on things like clothes, eating out, movies, gifts, and anything fun, basically. If you start to cry when you realize how little fun money you have, then you need learn How to Reduce Your Expenses.
Put everything but your spending money out of reach. The easiest way to do this is by leaving everything (except your spending money) in the bank. Withdraw all of your fun money in cash, and leave your debit card (and credit card[s]) at home. Use the cash for anything you want, just make sure you make it last until your next paycheck. You might not want to carry it on you all at once, but having physical cash will help you keep better track of your fun money than using a card.
How to Pay Yourself First
http://www.wikihow.com/Pay-Yourself-First
The phrase "pay yourself first" has become increasingly popular in personal finance and investing circles. Instead of paying all your bills and expenses first and then saving whatever is left over, do the opposite. Set aside money for investing, retirement, college, a down payment, or whatever requires a long-term effort, and then take care of everything else.
Create an account that is separate from all your other accounts. This account should be only for a specified goal, usually saving or investing. If possible, choose an account with a higher interest rate--usually these types of accounts limit how often you can withdraw money, which is a good thing because you're not going to be pulling money out of it, anyway.
Determine how much you want to put into the account and at what interval. For example, you can decide to put in $300 per month, or $150 per paycheck. This will depend on what you intend to do with the money. For example, if you want to put a $20,000 down payment on a home in 36 months (three years), you’ll need to save about $550 per month every month.
Put that money into the account as soon as it is available. If you have direct deposit, have a portion of each paycheck automatically deposited into the separate account. You can also set up an automatic monthly or weekly transfer from your main, active account to your separate account, if you can keep track of your balance enough to avoid overdraft fees. The point is to do this before you spend money on anything else, including bills and rent.
Leave the money alone. Don't touch it. Don't pull money out of it. You should have a separate emergency fund for just that--emergencies. Typically that fund should be enough to cover your for three to six months. Do not confuse an emergency fund with a saving or investing fund. If you find that you don't have enough money to pay your bills, look for other ways to make money or cut expenses. Don't charge them on your credit card (see Warnings below).
Tips
The idea behind paying yourself first is that if you don't, we somehow find ways of spending money until we have very little left. In other words, it's like our expenses "expand" to meet our income. If you cut your income by paying yourself first, your expenses will stay under control. If they don't, be resourceful instead of dipping into your savings.
Warnings
If you become increasingly dependent on credit cards so that you can pay yourself first, then you're missing the point. Why save $20,000 for a down payment while you're racking up $20,000 of debt (and the interest charges that come with it)?
It may be difficult to pay yourself first as outlined above if your financial obligations are urgent, such as if your rent is due or collectors are at your door. Some people believe that you should pay yourself first no matter what, and others believe there's a point at which you should pay others first. Where you draw the line is up to you.
Epiphany Essentials advocates paying God first, then yourself, then your bills...Even if paying God and yourself 1st means saving/giving a $1/check heck even $.25 start somewhere and get into the habit of saving/giving.
Be a blessing and be blessed,
Epiphany Essentials
Good stuff!!!
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