How will you spend your money in the next few months, or the next year and beyond? It's a good idea to put your goals in writing and create a spending plan that will give you enough money for every day expenses, while helping you save for your goal. Check out five tips for smart spending and saving.
1. Get a true picture of how you spend your money.
To find out where your money goes, save all your receipts, track your purchases via your online banking account, or use a SEFCU's MX Money Management, for at least two weeks. Then group your expenses into categories like entertainment, transportation, food, clothing, and gifts. Figure out how much you're spending each week, month, and year.
2. Make a list of your income.
Write down what you earn from jobs, gifts, allowance, and any other sources. Calculate what you make each week, month, and year. If your income isn't steady throughout the year, estimate the annual total and average it per month.
3. Evaluate your situation.
Do your income and expenses offset? Are you spending more than you're making? Or do you have money to spare?
4. Create a written spending and saving plan.
Figure out how much you need to save each month to reach your goals. Then decide how you'll come up with this money. When making your plan it's better to estimate that you'll spend a little more and make a little less than you think.
Now that you know your expenses and income, you can plan how much to save for your goals. Look for some easy ways to save - like bringing a lunch to work, or cutting back on entertainment and clothing. Remember, even saving $1 a day will give you $365 a year to put toward your goals.
5. Put your plan into action.
For one month, try to make more or spend less. Once you reach a goal, review your plan and tailor it to fit your next savings goal, giving you the power to purchase what you want.
Interested in more? View upcoming free sessions offered by SEFCU's Institute for Financial Well-Being.