It can often feel that we are out of control when it comes to money. It can feel like we are paying out so much money for different things that there is never anything left or that we do not even know what the money is being paid out for. It is well worth making sure that you have more awareness and then you can start to control your spending more easily.
Keep Household Accounts
It is a good idea to keep household accounts, at least for a while. This sounds complex but it need not be. You can use either paper or a spreadsheet on your computer. Then note everything that you have coming in and out. So, when you get paid, note it down, when you buy something note it down. You will be able to use your bank statements to help you as well for any standing orders or direct debits. Once you have a full month you will be able to get a good idea of what money you normally have coming in and how much tends to be paid out each month. This will change month by month so it is also worth thinking about whether you will have some months that are significantly more expensive than others.
This might seem like a hassle but it will help you to find out exactly where every penny is being spent. This can allow you to start to see whether there are any places that you can start to control your money better. It might be that you have identified an area where you spend a lot of money that you feel you can cut down. For example, perhaps you buy a lot of chocolate bars and you could buy less, look after your health and save money. However, it is likely to be the bigger expenses that will be the ones that will have a bigger impact. For example, you will probably be paying out rent or mortgage, utilities, insurance and things like this that are big amounts of money. These are things that seem to take big chunks out of our current account and make us feel like we do not have a lot left. Therefore, it could be this sort of thing that we should be focussing on first as a few small changes could have a bigger impact. For example, switching to a cheaper insurer could save hundreds of pounds a year.
Therefore, it can be a good idea to compare prices on lots of things. If we do this for everything we buy, starting on the big things, then this will enable us to be bale to start saving money right away. We could also do this on cheaper things as well, because small savings will all add up. By noting how much things cost, we will also be able to stay in better control because we will be fully aware of how much we are spending on things. This might lead on to us thinking harder about purchases and whether we should really be making them. We may look at a price and then think harder about whether we really think that the item is worth that much and decide that perhaps we do not want to buy it after all. Starting to think more about all purchases can be a good way to feel more in control. Knowing what direct debits and standing orders we have will help, as we will know what will automatically go out of the account. Then knowing what money is left will help us to know what we have left to spend and we can then think more carefully about the purchases we are making and whether we can afford them.