The Secret to Money

It’s simple but not easy: Live on less than you make and put money away for the future.
Life happens, Things will break, we will have sick days, we may want a house and would like to retire.
We work with many people trying to gain some control of their money and it generally comes down to living on less than you make. Sometimes it requires finding a way to make more money or to sell something. Having lived for a while, I have some experience with looking at the bank account and trying to figure out how to make it work. I remember thinking ‘oh the payments only $50 a month, I can do that’.  I have moved many times and have given away or sold many things for pennies on the dollar and know that the things that I just have to have now won’t be in the near future.
The secret to creating a spending plan is to lay out when your bills are due, how much they are and when your paychecks come in. IF you are just starting, a calendar works well. I suggest a paper or wall calendar as it’s easier to visualize the flow.  There will be weeks that there is very little extra or that has to be held till the end of the month for the rent/mortgage. Looking at several months at a time will allow you to see the fluctuations and prepare for them.  There are many apps that can help with this but I recommend doing it on paper first. The apps are very good at helping you track your dollars.
The next step is to make a list of all your debt- Name of account, payment, balance and interest rate.
This step may take your breath away but seeing it allows you to create a plan.  Some people make a plan to pay minimum on all but the smallest and put extra on that one till it’s paid off and then move that amount to the next smallest. (Snowball method). I usually explore which bill is the most onerous, whether its money owed to family, or a bill that you just want to pay off.
Hopefully there will come a time when watching your savings or net worth grow is more meaningful than buying.

​If you want assistance in doing these steps and making a plan, please contact us.