What’s the worst item you bought? What’s the best item you purchased?
The worst thing I bought was the first engagement ring for my wife. It didn’t have enough carats. Thankfully I learnt fast - the upgraded ring is now the best item I have purchased.
It is often very easy to spend rather than save. I think COVID has helped us in this area. If you have trouble managing your expenses try the following process.
Step 1: Review
Download one years’ worth of expenses from your main transaction account and credit card. Check how much you spent. Determine what spending could be reduced.
Step 2: Categorise
Split your expenses into categories and populate a budgeting tool. Don’t forget an allowance for one-off expenses (e.g. car upgrade). See link for a tool https://www.precisionfinancial.com.au/tools
Step 3 Prioritise
Determine the essential, desirable and dispensable expenses.
Step 4 Track
Monitor your spending to see if you are gradually reducing the dispensable expenses.
Step 5 Update
Update your budget tool with your revised budget.
Step 6 Set Savings Goals
Set goals and pay this amount into an a short, medium and long term investment account when you are paid.