by Chris McCullough
Here we are in the spring so let’s do a little spring cleaning with your finances over the next few months and find out where we spend our money. Getting a thorough understanding of where your hard-earned money goes will allow you to make money-saving cuts.
One of the easiest ways to give yourself a financial check-up is to track your spending habits. Budgeting, very much like dieting or exercising, is something we all know we need to do but never get around to, and when we do start, we don’t stick with it very long. If we know where our money is going, we have the ability to change it.
Without knowing where our money is going, it’s almost impossible to save for a big purchase (car, house, wedding, etc…) as we struggle to get through each month. So take the time to track your spending. Start with one day, then track it for a week and finally get through an entire month.
There are many ways to accomplish this, but the easiest might be to buy everything using your debit card for a month. When the monthly statement comes, it will show you where the money went. You’ll be surprised to find out how much is spent on items that can easily be cut back.
For those constantly on the go, there are many free online tools and mobile apps that will break down your spending into categories, such as utilities, groceries, dining out, rent, etc… Use these and see just how much of your hard-earned money is spent on items you will call “frivolous” at the end of the month.
These same tools and apps will alert you when you are in danger of exceeding a set budget. They will also provide calculators for you to figure out how much you need to save for a big-ticket item like a car, or down payment on a home.
Tracking a month’s worth of spending is truly an eye-opening experience. And just like exercise and eating healthy, once you figure out where the problem is, it becomes a lot easier to fix the issue.
There are many tools and services available to consumers. We should all be aware of our financial health and work to get our financials on track.
Chris McCullough is Rabobank, N.A. Vice President and Branch Manager in Murrieta. Rabobank, N.A. has 119 retail branches in California, including Murrieta. www.RabobankAmerica.com.