We could all probably be a bit more frugal. We all have blind spots where money is concerned, and that goes double when we purchase the things that we enjoy or “need”. For instance, you don’t “need” a new phone or laptop every year, but, if you happen to have a weakness for shiny new gadgets, you factor it into your budget the same way that you would food, utilities or the roof over your head (rent, mortgage, etc). A little splurge on nice shoes or a new piece of tech every once in a while probably won’t push you out onto the streets, but getting into bad spending habits is best to be avoided. The most important thing to do with your finances is to keep track of where and how much you’re spending. That way, if you need to do some belt tightening, it’s easier to see what needs to be cut to keep everything running smoothly.
The best time to start tracking your spending is right now. Ready, set… go! Okay, now that it’s now, you’re going to go about your business as usual, except for one crucial caveat: you’re keeping track of every purchase that you make. If this makes you a bit more self conscious about your spending, then you’re doing it right. Now, I’d suggest remaining in this hyper-vigilant state for about 1 week, just so you can establish a weekly baseline for your every day expenses: groceries, eating out, gas, tolls, luxury purchases and all those other incidentals that you might run in to. I tried out this little exercise last week and found that my biggest blind spot was eating out. Pretty much every day, for at least one meal really adds up when you consider that it’s about twice as expensive as packing yourself some leftovers for lunch. Whatever your little indulgences may be, it’s better to be aware of how much they’re eating away at your paycheck than just let money go without any thought.
Once you’ve gotten a good sense of your day-to-day finances, it’s time to get a handle on some of the big picture stuff. It’s never too early to start saving for and investing in a stable financial future. If you feel intimidated by investing or just don’t know where the heck to start, there’s Investopedia, a free resource that can get any investing novice on the path to stacking dough. Aside from their investing glossary, the site offers tutorials on everything from the proper way to use credit cards to how to plan for retirement (if retirement even exists in 30 years). Wherever you’re at with your financial planning, just remember that, while money isn’t everything, it’s pretty dang important.