Eight Steps to Tackle the Money-Saving Process (Part 3)
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Part 3: Analyze Your Expenses
that you have a specific money-saving goal to strive towards, it's
time to dive into the process of lowering your monthly bills and
Obviously, a choice you have is to
work "overtime" hours at your current place of employment,
or get a "second" job for additional income. For the
record, the following process we will divulge does not look at this
Hence, the agenda from this point
forward will be to analyze all your expenditures, and lower the
monthly amounts of each bill one by one in order to save the
Where To Begin
To come up with extra money, or to
generate a substantial increase in your monthly savings, you MUST
first find out where you are spending the money you earn.
Everyone's individual saving
potential is unique, varying anywhere from $10-$1500+ a month. Since
incomes and monthly expenses differ for literally every household,
it is impossible to set a standardized target everyone can achieve.
Point is, regardless of how much
money you make per month, it is imperative that you find out how
much money you are spending per month, and even more specifically,
how much you spend on each specific bill/expenditure.
The degree of accuracy you put
towards this task is up to you as always, but at some point you will
need to list out all your monthly expenses. To put your mind at
ease, you don't need to spend hours upon hours calculating averages
and compiling data for the past decade. You simply need to list out
each and every expense you pay per month, and the most accurate
estimations for each particular expense.
Here are some of the most common
monthly bills found in most households:
If you have the most current
statements handy, then by all means use the exact amounts, however
try not to let this exercise consume more than an hour of your time.
This is not meant to depress you, or criticize your spending habits.
It is merely a list to help provide you with a "bird's eye
view" of how and where you spend your money.
Now That You Have Your List
We all have some spending habits that may be a bit excessive, or
untamed. You may have even surprised yourself as you were making
your list of expenses and had to double check to see if you were
writing the correct amount. That's ok! Think of it this way, it will
only get better from here on out.
Our goal now, is to eliminate all the
excessive, unnecessary spending on as many monthly bills as
Using your list of
bills/expenditures, go through and highlight or underline FIVE of
the bills that seem to be the most excessive. In other words, you
are looking for five of your bills that you can immediately tell are
These are the five bills you will
want to tackle first since they are the most extreme and will
probably be the easiest to lower.
NEXT ISSUE -
Part 4: Eliminating