The ability to live within your means does not depend on the amount of earnings. Often, it is not the money itself that is lacking, but the ability to manage it. Is it possible to learn how to save and stop spending your entire paycheck in the first week?
Why do you live paycheck to paycheck? Planning a budget helps cover basic needs and save up for a rainy day.
What are the reasons for excessive spending?
Why do you live paycheck to paycheck? First of all, you need to understand the reason why you are spending faster than you earn. What do you do when you receive money? Do you give out debts, pay off loans and go to the next sale that you have long dreamed of, and then you are surprised at the lack of funds? This is due to:
- Lack of priorities in spending.
- Inability to plan expenses.
- Unwillingness or inability to save. Living beyond one's means leads to loans and borrowed money .
Psychologists say that many people simply do not want to save money, considering the calculation of funds the lot of losers. Meanwhile, it is successful people who can serve as an example of reasonable savings. You cannot succeed without financial literacy. How to get rid of negative financial habits?
6 steps to personal financial well-being
Smart personal finance planning improves the quality of life and strengthens personal well-being. The ability to save is not a gift or talent, but a useful skill that anyone can develop. Six simple steps will help you with this.
Step 1. Keep track of expenses
You can do this in a notebook or on a computer or smartphone. Fully functional home accounting programs have been developed. They help not only to fix, but also to plan expenses. Important:
- You need to take into account absolutely all expenses: from buying ice cream to a new gadget, paying utility bills to traveling in public transport.
- To learn how to keep track, highlight during the day time to record and count all expenses. Gradually, this will become a habit.
- You need to keep records constantly and honestly, scrupulously recording expenses.
Accounting and recording all expenses is the first step to reasonable savings.
Step 2. Analyze expenses
It is better to do this at the end of the month, use records of your daily expenses for analysis. Important:
- Divide all expenses into groups. The first is mandatory, without which it is impossible to do. These include the following items of expenses: payment for communications, utilities, loans, travel, necessary products and household chemicals. The second group is optional, which are not critical to health or lifestyle. This includes entertainment, purchases "for future use." The third is extra spending, which includes luxury goods, spontaneous purchases, in a word, everything that you can definitely do without.
- After that, analyze each group and decide how you can reduce expenses for it. Switch to a more economical communication package, buy groceries in a remote but cheaper supermarket, reduce spending on bad habits, and so on.
- Then calculate all the planned income and distribute them into groups.
- Based on your analysis, calculate the amount of spending per week and per day.
Step 3. Control your spending
Once you have determined your allowable amount of spending, you should make an effort to stay within it. borders. Important:
- Go to the store when you need it.
- Plan your purchases in advance, even before going to the store.
- Only shop according to the list.
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- Take a limited amount of cash with you.
- Minimize the use of credit cards.
Step 4: Be mentally comfortable
It is important to feel comfortable in the new role of a thrifty host. Therefore, at first, you can set aside a small amount for optional purchases, but do not exceed it. If the expenses turn out to be less than the allotted amount, then the surplus will replenish the savings.
Step 5. Form a financial "airbag"
At first, it is not the amount that matters, which you put off, but the very fact of its presence. It will boost motivation. Important:
- Don't skimp on your health to save a few extra tenge. It is better to save money on entertainment, bad habits or expensive hobbies.
- The main thing in accumulation is regularity. Time is running fast. In a year, you can collect a decent amount, which will be a good help.
Why do you live paycheck to paycheck? Small but regular savings will provide psychological comfort and a guarantee of security in difficult situations
Step 6. Live within your means and try not to borrow money
The money you earn quickly goes away because of debts, which must be given away. So it's best to avoid it. If the situation is such that it is simply vital to take a loan /loan, then it is imperative to correctly calculate the amount that
