I’m so excited to start this six day series and to help you find that Financial Freedom. Over the next six days, you are going to be taking control of your finances like never before. Like I said yesterday (and truthfully continue to say) I want to help you take control of your finances, and most importantly find that extra money and build financial security you deserve.
It is easy for us to remember how much we spent on fixed expenses such as our mortgage/rent, car payment, cell phone bill, and cable. However, we have a harder time with bills that can change monthly like gas for the car, utilities, and groceries. With technology those things are easier to determine because we can pull out our checking and credit card statement to check.
But hold on! What about food, entertainment, and all the other fun stuff? We need to figure that out! Do we just make up numbers in a budget and hope for the best? No, if we did that we matters well jump out an airplane with no parachute and hope someone helps save you!
So today we are going to focus on where is your money going? Not just a small piece of your expenses but all of it….the good, the bad, and the ugly!!
In reality this only takes a couple seconds of your time each time you buy for something (and yes – EVERYTHING) and will have a major impact moving forward. Before we can create a “real” budget or plan financial freedom we must know where your money is going.
So over the next 30 days I want you to carry a small pocket notepad everywhere you go. I recommend a pocket size with a pen because it can fit in your pocket or purse and easy to get to and use each time you make a purchase (Amazon.com). Write down EVERYTHING you spend in the next two weeks including where you bought it, amount, and a description. We want everything it doesn’t matter if it is a $75 piece of clothing or a $6.50 Starbucks Triple Grande Skinny Vanilla Latte.
You will be very surprised when you go back after doing this and seeing where your money is going? I promise you will be saying “Oh my!” because what you are spending is more than you think….trust me. Thinking I only spend about $50 on coffee out a month and it turns out you actually spend $150 it is a wake-up call.
Before you think “Oh no I have to have my Triple Grande Skinny Vanilla Latte with an extra shot and you are going to tell me I can’t”. That is not the case. If you are able to budget and afford it go right ahead but don’t put that drink ahead of your financial health and go in debt because of it.
After the 30 days go through and add up all the expenses into categories based on the categories in your budget. We will be discussing budgeting tomorrow which will help make this part more sense. You might be thinking I have to do this for 30 days and you are going over budgets tomorrow. That makes no sense at all. It is okay…this series is a building block for you and you can continue to come back to this series. Plus we can go ahead and create a budget and then after seeing where your money is really going you may end up saying no I will keep my budget and cut those expenses or maybe adjust your budget some.
To have financial freedom and love life we must take small steps and the second step is to know where your money is going. The first was saying you wanted financial freedom which you did yesterday in the Debt Series-preview.