“Chains of habit are too light to be felt until they are too heavy to be broken.” -Warren Buffett

Where does your money go?!

Today I want to talk about where our money goes!  We spend a fair amount each month/year for insurance (home and auto), property tax, food, gas and misc spending (I'm looking at you amazon!).  We've shared tips on reducing expenditures on insurance, food and other bills, but I want to know what other areas you are spending in that we should talk about in more detail!  I love learning from how others adjust their habits and being encouraged to adjust ours further as we work to achieve our financial goals.
A lack of budgeting contributes to overspending. 
When we are reviewing our budget every few weeks I always notice we spend way more on "miscellaneous" expenses than we ever budget for.  We don't break down into Pet, Kid, Cleaning supplies and so on, it's just one amount.

You wouldn't attempt to lose weight by saying, I'm not sure what I weigh now or what my goal is and I don't have a plan to put it into action, but I'd like to cut 10 lbs.  If you do start this way, you aren't likely to achieve your goal.

Similarly, you shouldn't approach revamping financial habits but saying, I'm going to spend less next month, without knowing what you are already spending, understanding you want to reduce it, setting a goal and making a plan to achieve it.

A lack of budgeting contributes to overspending.  One of the biggest impacts you can make is getting real about how much you are spending and where.  The only way you can ever start to address it is by knowing, and understanding your spending habits.

Once you know your actual financial situation and habits, then you can create a plan to address it.

  • Step 1: Understand what you previously spent.
  • Step 2: Know where you want to end up.
  • Step 3: Make a plan to get there! 
  • Step 4: keep working your plan until you achieve your financial goal!
  • Step 5: Celebrate!  You did the work, now you get to enjoy the fruits of your labour!

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