Have you ever asked yourself this question “where does all my money go?”
If the answer is yes then perhaps you need to consider a budget. A budget doesn’t have to be a scary word it is merely a tool that can help give you clarity. Knowing is half the battle. When you know where your money is going you can then make decisions about your spending behaviour. Do you want to make a new choice?
Are you in a committed relationship? If yes, are you and your partner working together as a team? For example are you sharing finances and working together to achieve common goals?
If not, now is the perfect time to consider a new bank account structure. The simple reason is that one plus one is greater than two. You and your partner will achieve synergy when you work together instead of working as individuals.
Should I save? If so how much?
The answer is different for everybody given all of our circumstances and commitments are different. However as a general rule of thumb you should always spend less then what you earn. A great starting point is 10% of your income. For example every $100 you earn you should save $10.
Have you ever been promoted? If so what did you do with the extra money? Did you save or spend the extra money? Many people find ways to spend it and that is perfectly ok but unless something changes, such as your mindset or behaviour, then your bank account won’t improve.
How do I start? What do I do?
The first step is about flipping around your priorities, most people spend first then think about savings. Instead what we encourage is to save a fixed amount (or percentage) and spend the rest taking into account your needs (food, water, shelter, clothing) and then fun (entertainment, dining out etc).
The next step is to make the savings process automatic. For example a regular direct debit timed with your pay cycle into a different bank account is a good start.
When you get momentum and the account starts to build up you can speak with us to look at alternatives that have the potential to provide a return greater than a bank account. Click here to find out more about wealth creation. [hyperlink]
The sooner you start the better for you and your future.
- Have a budget – know where your money is going.
- Start today. No excuses.
- Take responsibility for your choices.
- Patience and discipline – it will take time.