Tip 34: Find out where your money is going

Sunday, December 14, 2014

Tip 34: Find out where your money is going

One way to cut spending is to really understand where your money goes. There are a few big expenses that are easy to understand- housing, vehicle payments, utility bills, and food. The opportunity most people have to reduce spending is by working on everything else, so understanding the smaller expenses and how much really goes for food is important.

Doing the work to figure out in detail where your money is going can be a great tool to spend less. When you look at monthly totals and realize you are wasting hundreds of dollars per month on wasteful spending, you may be motivated to change spending habits and keep this money instead of giving it to others. This is a motivator for me. When you spend money, it generally ends up in the hands of people who need it less than I do. It seems like store owners, company shareholders, bankers and others with lots of money are the ones who end up with most of the money that I spend. I am happier keeping more of my money myself than having it end up in the hands of people who already have plenty of money.

When you see that you are giving a lot of money away to other people- people who need it less than you- this helps you focus on keeping some for yourself instead.

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