We get money and then we spend it. It’s an endless cycle of giving and receiving. You might be used to asking yourself, “Where did all my money go?” Perhaps you should ask yourself these questions instead:
- What are your goals? Do you plan to take a lavish vacation next year or pay off your auto loan? Knowing your goals is a great way to create motivation to save!
- What are your bad spending habits? Think about the money you spend on things you don’t need… How much money would you save by cutting back? For me, I could easily pay more principal on my auto loan if it weren’t for all the iced lattes I buy!
- What are your responsibilities? Whether you have taxes to pay or a college tuition, what are you doing to prepare for those large bills? The best way to become prepared is to have a plan for when that time comes; saving a little each month is the most effective method!
- How good of a deal are you getting on the things you do need? Your refrigerator went out and you need to buy a new one, but make sure you aren’t overpaying and that it fits in your personal budget!
- Is that affordable? One thing I’ve heard Dave Ramsey say that really stuck with me is that you can’t truly afford something until you can comfortably buy it twice. We all deserve a treat now and then, but if we have $200 in our account to spend and that luxury watch is $125, can we truly afford it?
Get to personally know your budget and recognize extra expenses. Your future checking and savings accounts will thank you!