Where Does All YOUR Money Go?

Where Does All YOUR Money Go?

June 30, 2016
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I stopped for coffee the other day and overheard a heated discussion (maybe an argument) between two young professionals – a couple – about money. Actually, about why there wasn’t enough in the account to pay for something. There were charges of wasting and selfish purchases, etc. Bottom line – in spite of two good salaries, they were facing a deficit. I thought about how many people are in a similar situation – having lost track of their money management plan. 


If you don’t know where all your money goes, you’re not alone. The truth is that many people spend in small increments and don’t keep track of how it all adds up. With a little discipline and some very basic tools, you can gain control of your personal finances.

 Prepare a budget.  

Make it a family affair, so that everyone participates in setting limits to spending and personalize it for your particular needs. Budgeting is the best way to manage your money. Here are some strategies for getting started: 

  1. Track your income and spending for a few weeks. Use credit card statements, bills, direct deposits, pay stubs, and cash receipts.
  2. Separate expenses into fixed (mortgage, rent, utilities, insurance) and discretionary (everything else).
  3. Set priorities for saving and spending.
  4. Create a simple budget for expenses based on your income and financial objectives. Review it weekly or monthly so that you are reminded to stick with it.
  5. Conduct an annual review to identify areas that need attention in the coming year. Make your budget a permanent tool for getting your spending under control.

Set aside emergency savings. 

You can’t plan for an unforeseen problem. Unexpected events – job loss, car repair, home maintenance emergency – can upset your balance sheet and create financial chaos. Make sure that an emergency fund is an item in your budget and set aside a portion of every paycheck. The rule of thumb is that an emergency savings fund should cover three to six months’ worth of living expenses. Even small amounts deposited on a regular basis will add up over time.

Use credit wisely.

Closely monitor your credit card use. The cards are so easy to use that many people tend to buy things they don’t need. The worst way to collect debt is with finance charges on credit cards. Try to avoid charging more than you can pay off each month. 

Developing good budgeting and money management habits is the first step to the kind of financial independence that allows you to determine how you want to spend your time and resources. Have questions? Get in touch today!  And for lots of tips on personal finance check out the Library of articles and calculators on my website.


Material discussed is meant for general illustration and/or informational purposes only, and it is not to be construed as investment, tax, or legal advice. Although the information has been gathered from sources believed to be reliable, please note that individual situations can vary. Therefore, the information should be relied upon when coordinated with individual professional advice.