June 13, 2013, 6:00 am

How You Can Fix Your Spending in 7 Days

by: MD    Category: Financial Planning
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Has your spending been out of control? Do you want to get things back on track?

I must admit that my spending falls off-track once in a while. Despite writing about saving money for the last 5 years, I still make plenty of mistakes. It’s easy to get distracted in life. It’s also easy to lose track of the basics and the fundamentals that got you to where you are. This is why you always hear people talking about going back to the basics. This is what we will do here. It’s time to go back to the basics and save some money.

Before we can save any money, we have to fix our spending so that we watch where are hard-earned money goes. As I’m sure your parents told you growing up, it doesn’t matter how much money you make, it’s how much you save that counts.

Let’s get started!

How can you fix your spending in 7 days?

Track it.

This is the most common advice for a reason. It works. If you don’t know where your money or what the problem is, you’ll never be able to fix it. This same logic applies to your eating and other habits in your life.

The good news is that you don’t have to be one of those folks that tracks spending 24/7. I personally could not imagine doing that. However, I want you to track your spending for the next week so that you see where your money goes on an average week. The trick is ensure that it’s a typical week and not an anomaly where you’re away on a trip or have to spend huge money on bills. Just your average week.

How can you track spending?

  1. An app. People have apps that count how many times they blink per minute. There’s likely an app available to you that helps you with tracking spending. I’ve played around with a few. They can get pretty slick. The app I used many years ago when I was an iPhone user (don’t judge) allowed me to track fixed expenses, variable ones, and the types of categories that the spending fell under. Find an app that works for you.
  2. Use credit/debit. One of the main benefits of a credit card is that you can track your spending. You just swipe to make your purchases. Then you go online to look over your statement. This is my preferred method. Plus you can get points with your credit card.
  3. Write it down old school. Pen and paper style. Carry around a notepad if you don’t have an app on your phone.
After you track your spending for a week or so you can move on to the next step…

Find out where your problem areas are.

The whole point of tracking is to see where you’re making mistakes.

What are your problems area?

My problem area for the longest time has been food. Every single time I track my spending I noticed that my spending on food is out of control. I now track only how much I spend on food because I don’t really spend much on anything else.

The trick is to find your problem areas.

  • Are you eating out too much?
  • Do you shop for clothing once a week?
  • Do you spend too much money at the movies?

Attack one problem area at a time.

It just won’t work if you try to cut back on everything all at once.

Attack your problem areas. Attack one at a time ruthlessly until you have it figured out. Be aggressive  Try to cut back. Try to find alternatives. Work on it slowly.

I’ve come to accept that I’ll never be perfect with my eating. The goal isn’t to be perfect. The goal is to be better. A little better every day will go a long way. You can slowly attack one problem area at a time.

The goal is to find out what your problem areas are and to decide which one you’ll go after first.

That’s how you can fix your spending in a week.

Where are you spending all of your money?

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Comments

Good post, I think my spending gets off track the longer I stay away from my mint account. If I’m not looking at it I kind of forget. Sometime I intentionally don’t look, because I know I’ve spent too much.

Good post.

The line: attack one problem area at a time, is a good one.

Big problems are best tackled in small, incremental successes.

Everyone can fix their spending but first that have to admit that they have a problem in the first place. Then by tracking(I use excel spreadsheets) they can see what the problem areas are. I agree only attacking one problem at a time is best.

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