Day: November 2, 2017

Day 2: Figure Out Where Your Money Goes

Tracking your spending helps you figure out where your money goes

I hope you are excited about these seven day’s, I sure am. Yesterday we gathered all of our financial records to get them organized. Now that we have all of our financial statements in front of us, it is time to figure out where our money is going. We can’t stop the leaks until we find out what and where they are.

Have you ever asked yourself, where does all my money go after paying bills? If so then you are not alone. By compiling your financial statements you are ready to prepare a summary of your monthly expenses.

Day 2 Figure Out Where Your Money Goes

Make a list of all of your expenses, right down to the smallest item. Pay real close attention to exactly where your cash is going. Oftentimes, you will find a lot of room to cut back in certain areas. If necessary, keep a journal for a day or two and write down every purchase you make. I realize this may be tedious, but you will reap so many benefits from doing so. One such benefit is quickly realizing what you waste money on.

Another reason to track your expenses is that it will help you figure out if you are living within your means because it holds you accountable for every penny you make and spend. You will know exactly how much you spend on both needs and wants and whether or not you are living within your means based on how much of your income is spent on both.

This is the first step in gaining control of your finances. I can’t stress enough how important it is to know where your money is going.

Another 20 minutes down and another 20 minutes closer to financial freedom. Now that we have organized and figured out where our money is going, come back tomorrow so we can categorize your spending.