You Have No Idea Where Your Money Goes
One of the most important things you can do in your personal financial life is to track your spending. Most people have no idea where there money goes each month. And if you don’t know where it goes, then you can’t get control of your spending.
Fortunately, its easier than ever to keep track of your spending. I find that the best way to do this is to invest $30-$40 in personal finance software like Quicken or Microsoft Money. Its easier than ever to use, and you can categories every transaction you make. In fact, much of this can be done automatically, saving you hours of time. You can easily set up these programs to automatically download all of your latest transactions when you log on. Then, you simply review each transaction and assign a category. If you have a reoccurring transaction such as a trip to your favorite grocery store, the software will automatically remember the appropriate category (groceries, dining out, gas).
After a few weeks, you’ll have a much better idea of where your money is going each month, and you will probably be surprised. My wife and I were able to cut our food budget in half after we realized how much we spent each month on groceries and dining out. Its an important step in getting control of your financial life.
