Ever get paid on a Friday and realize by Monday morning you have no money left??
Yeah, we have all heard that much of the world lives this way. But, does that make it okay for you to live this way??
Not taking control of your money, not understanding what your obligations are and what is left over after your bills are paid, and worse yet, not paying your bills on time, are mistakes that will continue to haunt you and hold you back in all aspects of your life.
We have worked with so many women who would rather stare at the sun for an hour than review their bank statements. They have no idea what is going on in their financial lives and the thought of finding out scares the shit out of them. And guess what else– few, if any, of them are on track for their goals either!
Knowing exactly how much money you make (your income) and how much money your lifestyle demands (your spending) is a critical first step to getting on track.
So, how do you get started?
1) Calculate your monthly income
- If you’re paid every two weeks – take your take home pay (the amount that is deposited into your checking account) and multiply by 26
- if you are paid twice per month – take your take home pay and multiple by 24
- Did you know you were making that much/little??
2) Pull last month’s bank statement and review it.
- This may sound horrible but how will you know where your money is going if you never look at it? Make it a part of your weekly routine to check in on your spending.
- Using a credit card? Pick one card to use for spending and review your charges online at least weekly.
3) List all of your bills for the month, when they are due and how much is due. Include everything! Your rent/mortgage, car payment, credit card payments, student loans, cable/internet, cell phone, Roth IRA savings, cash savings, etc. (I hope you are saving something! More about this at a later time…)
4) Subtract number #3 from #2 – this is how much you have left over each month to live your life. If you aren’t saving, perhaps you can peel off some of this excess and put into a Roth IRA. Not much left over? Stay tuned for tips on how to cut the fat.
I sincerely hope you take the time to complete these steps. Most likely you will have some questions about what to do with this information now that you have it – I will be sharing more thoughts on that soon! But in the meantime grab a girlfriend and start talking with her about this stuff! You likely aren’t alone with your questions and perhaps you can pick up some good tips from your pals!