How do you manage your personal finances?

Question

For a Long time now, I live from hand to mouth and I dont know how to save for the future, If I try to save, then I would not allow myself miss somethings I desire, so I go to the next autoteller for my cash until it finshes.Thats when I can allow myself to do without. As I am writing this I am bloke and have blown my OD facility. I am sick of this, help please.I am relatively on a good Job.

Answer 1

The key thing is your one's attitude to money. You've got to make it work for you.

Firstly, look at all your outgoings and see where you can reduce or eliminate any costs ie Coffee from the coffee shop, being generous with the rounds of beer, unnecessary shopping trips etc etc

Secondly look at your bills. Can you get a cheaper supplier for your electricity, gas, mobile, landline, credit cards, mortgages? Check this out and switch as soon as possible. Calculate your savings and put them into a tax-free savings vehicle straightaway.

You mentioned your OD, maybe it's time to change bank account to get a better rate. If not pay that off as soon as possible and then you're just living on your cash not debt.

This will not happen overnight but should get you on a start to managing your money more effectively. However, do treat yourself once in a while. Treat myself with a £40/$80 massage at the spa or go and buy a nice treat from department store for myself or my house.

Good luck!

Answer 2

Start banking on line, it makes it so easy to see whether you have funds to spend or not. Also have what you can afford put into a savings account each month (even if its only £10-£15) you will be suprised how quickley it grows and you will always have emergency money. (Make sure you put it into an account that you cant withdraw from too often)

Budget for food and dont go over! pay bills by monthly d/d so you know how much is going out each month.

Save up for big items, it will give you a real buzz when you can finally afford it.

Dont blow so much in stuff you really dont need.

Music and expensive clothes are great but the world wont stop turning if you dont get them all.

Good luck.

Answer 3

Have a good luck at your bank statement and write down a list of all your direct debits and standing orders - things that you know will be paid out of your account every month.

Then write out a list of your cash expenses from week to week.

Then write out a list of your yearly expenses, including house and car insurance, home heating for the winter, christmas, bithdays, holidays, car tax etc and everything else you're expected to pay.

Add them all up and divide to find your real monthly spending. Unless you have an extremely good job, you'll probably find there isn't much left over at all!

If there is some left over, budget for entertainment out of that.

Finally, budget for savings- if there's nothing left to put into savings (and the goal should be minimum 10% of your income), then you're living beyond your means and will never save unless you cut back somehow.

Once you've figured out where the money is going to come from, go to your bank and set up a direct debit or standing order to either a deposit account or some savings scheme - make sure the money is taken out on your payday - that way, it's gone before you see it, and you should set it up so that you have no instant access to it.

Good Luck!

Answer 4

Keep an expenditure diary, where you write down exactly how much you spend on what. A small book you carry around with you will do. Keep a running tally of your outgoings.

Then draw up a budget, which lists all you regular outgoings - I find a monthly one works for me. For less regular things that you don't pay for every month, calculate how much you spend in a year and divide by 12.

Distinguish between things you have to pay for, and things you just want. Pay for the former, and you can buy the latter with any money you have left over each month, or save it for a rainy day.

Answer 5

Let the missus deal with 'em. She's tight as a ducks a*se, and won't let a penny slip through her fingers. If i had control of the money, i'd have spent a months wages in two weeks or less.

On a more serious note, you could arrange for all of your bills to go out as direct debits, on the same day (or day after) you get paid. You could also have some money that is directly debited to a savings account (on the same day as your bills), that takes seven days notice to access. If you're as lazy as me, you'd rather go without than have to fill in the paperwork necessary to access the money.

Hope this helps.

Answer 6

I use a spreadsheet to see how much I am spending each month listing income and outgoings, DD and SO first then any withdrawals and card payments. I dont have a credit card just a debit card.

The other option is to open a savings account and transfer some money every month by SO so it leaves your account automatically.

Answer 7

sit down one day when you can relax and write down your income and outgoings on a piece of paper. Everything that you pay for .You can do this by referring to your bank statement ,if you can not remember everything. if the result is showing that your outgoings exceeding your income, you have to go through the list and find out what costs you can reduce and or do without. Take advantage of interest free credit cards and consult either with Citizen advice burea or speak to your bank manager, you may find some who are helpful.

Answer 8

The good news is that you're away of your goals and your weaknesses. That's a positive thing. Since you want to save for the future, I am assuming you are talking long term. Your best bet in that regard is with a tax free 401K plan. That money comes off the top and you cannot spend what you don't have. Because it's tax free, you are actually making more to save that had you gotten the same amount after taxes so you're really not going to miss much. Even saving 1%, 5%, 10% or whatever you choose is better than nothing. If your employer matches with free money, set aside at least the amount they'll match. If you don't have access to a 401K plan, consider an after tax Roth IRA. Contribute regularly and do it off the top before you have a chance to spend it ... automatic contributions are your best bet.

The next thing considering your weakness for spending is to only spend cash, not plastic. You will think twice when you see your hard earned dollars slipping from your hand. That's emotional. Using plastic is not emotional at all. You don't see those transactions as money. If you have debts, pay them in full as quickly as you can.

As for future spending, do you see value in the things you buy? Many of us buy silly things. That's usually the result of lessons we've been taught about money and they are usually not respectful of money and it's value. We often buy things to make ourselves feel better. It works for a short time and then we discard the items (look around you) and we buy more out of the same frustrations. Think of your money as a part of yourself. Do you respect yourself??? Consider boosting your self esteem and you'll find you don't have to waste as much money to make yourself feel better.

When you do purchase, buy wisely. Review your expenses and think of things that will give you the same amount of pleasure that will cost less. Can you buy things used instead of new? Do you shop around for price to make sure you get value? Do you need all of the products and services that you have been paying for? How many books have you bought that you could get free from your library? Do you have cable channels that you don't really use? Are you paying for a cell phone package and a home phone instead of choosing one over the other? Even saving $1 here and $2 there will add up over a year, five years, decade, etc.

When you save money, be conscious of the saving and put that amount into an interest bearing account. Do not allow yourself access to that account. Mail payments to a bank in another city that you would have to drive or fly to in order to access. If you save $1,000 in a 3% account for the next 20 years that money will compound. Of course, 3% is nothing... consider other investments for more of a return.

Check out books by financial gurus like Suze Orman. I like her. Knowledge is power. Educate yourself.

Don't give up on yourself and your goals. Find a photo of an elderly person or couple enjoying themself. Consider that your goal... to have health and wealth in your golden years.

I am not saying to live like a miser but frugal living is in vogue. Do you need a $1000 sofa when a $400 one is just as cozy? Do you need that Lexus or would a year old Chevy do the trick to get you from point a to point b.

Evaluate your taxes. Are you letting Uncle Sam have use of your money for a year so he builds interest??? Stop that... NOW. Get your own savings account and save the tax money for yourself bearing interest. Again $1 here and $2 there will surely add up over time.

Consider tax shelters... your own home, a part time business, the retirement fund(s), continue your education. Talk to an accountant... read books... educate yourself.

Invest in yourself ... you ARE worth it!!!

Look at ways to increase income or reduce expenses. The future will be here before you know it.