It’s a cycle that many people are familiar with: You just got paid, but after spending some cash over the weekend you’re suddenly broke again. Where does all your money go?
Find out exactly how your money is being spent with a personal spending audit. It’s not as boring as it sounds — and you could find some extra cash to put towards your student loans, savings, or maybe even something fun.
How to find extra money in your budget
1. Schedule an audit date
Take yourself out on a money date: Schedule a day and time to sit down with a cup of coffee (or glass of wine) and get this audit going. The goal is to make the process as enjoyable as possible.
In preparation for the audit, gather all your financial statements, including those for your bank accounts, credit cards, student loans, car loans, and any investments you have. Open a spreadsheet or grab old-fashioned pen and paper, and list out the balances in all your accounts.
2. Review your spending habits
Now that you have all your financial information in one place, look at each transaction that has gone through your bank account and credit cards in the last month.
How often do you purchase a cup of coffee? Have you worn all the clothes and shoes you bought recently? Did you need to buy all of those books?
Review your spending habits and go through each item line-by-line. Ask yourself how much you really needed each item. You might start to feel a bit of buyer’s remorse, but this can be channeled into a good thing.
The goal is to spend money on items you love without guilt, but avoid mindless shopping that doesn’t add value to your life. A personal spending audit will help you achieve this goal.
3. Manage your money for free
If you’re not already using a free budgeting app to help manage your money, now is the time to sign up with one. You’ll be able to monitor your transactions every day, evaluate your spending categories, and look for places you may be overspending.
A free money management app will make your monthly budget meetings go a lot quicker, and you’ll be able to see your finances on the go with mobile apps.
All of this will help you create long-term spending habits that are aligned with your values, so you don’t get to payday and end up broke again.
4. Find ways to cut expenses
What are you paying for that you could do without? Do a thorough audit of your expenses and look for alternative ways to find extra money.
Go back through your bank accounts for the past 90 days and review all your expenses, such as magazine subscriptions, cable TV, cell phone costs, and other bills. Are you being charged for added expenses you didn’t sign up for don’t use regularly?
Spend some time researching lower car insurance options. Call your student loan servicer and ask how you can reduce your interest rate, or if you qualify for any payment reductions. Don’t just try to cut back daily spending — look for other ways to reduce your expenses overall.
You may not have to sacrifice your Friday night happy hour if you’re able to negotiate lower payments on some of your bills.
5. Start a regular savings routine
A savings account can be a lifesaver for all kinds of emergencies and financial hardships. You won’t know how badly you need one until it’s too late.
Get started now with a regular savings routine. Even saving just $5 or $10 per week is better than nothing. As your savings habit becomes more solidified, you’ll be able to increase your contributions until you’re socking away a good amount of money regularly.
If you find that you’re more of a spender than a saver, you may need some extra help. Consider using a micro-savings app like Digit, or separating your money out into different savings buckets with SmartyPig. These apps can help you save money, even when you’ve tried and failed to do so on your own.
If you’re trying to find extra money, doing a quick audit of your finances and spending habits will help. Think about it — no more feeling out of control or wondering where your paycheck went.
These tips will help you take a good look at exactly how you’re spending your money so you can pinpoint holes in your strategy. Use the extra cash to put toward student loan repayment and other financial goals, and invest in your future. Give it time and you’ll start seeing positive financial results.
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