I’ll admit, I’m not good with money but I want to be. As much as I try to save and stick to a budget, I easily lose control when I see a seat sale or a pair of shoes that I have to have. I would like to think I’m getting better at it but truth be told, i have no idea what I’m doing. I don’t know how to budget my expenses properly and actually stick to it. I’m not sure where to invest my money. I’m basically pretty clueless.
Now that I really feel I have to get things in order, I am turning to my boyfriend for help. He took up applied mathematics in college and majored in mathematical finance, so he knows what he’s talking about. I have asked him for some help before so I thought I’d share two tips that stuck with me. They’re honestly pretty easy to follow and simple enough to implement. But actually following and sticking to it is a different story. Now that we’re starting Q2 of the year, let’s get our finances in order shall we?
Split your income
“Around 20 percent allowance, meaning I can use however I want but [that] includes meals, movies, drinks, etc.” Don’t forget to take into account how much you charge on your cards. “Around 15 percent [goes to] all my bills.” And always set aside some cash. “A certain percentage goes into savings. [This] will vary month to month, but the year-end goal remains the same.” But also make sure you have something left for yourself. “Then whatever is left goes into my ‘fun fund.’” Basically money that he can spend however he chooses.
Keep an eye on your expenses
No matter how much you earn, you have to keep track of how much money is coming in and how much is being spent. Vince likes to keep a very organized Excel spreadsheet, which is divided into different categories. You can customize your own depending on your inflow and outflow. You can also adjust this based on your goals. Why does he use this template? “So I know at any point in time how much I have in allowance, savings (cash, bonds, [and] equity), fun fund, dollars (if any), and credit card bills.”
These are just baby steps that you can take, especially if you’re just starting. Do share other tips and tricks that worked for you in the comment section below or shoot us an email at firstname.lastname@example.org.