One of the hardest challenges youngsters face nowadays is that they are unable to control their expenses. Managing money is difficult as there is always some or the other attractive sale going on, there are so many food joints you want to try and so many places you want to visit. Thus, most of them complain of being broke as the end of the month nears. So if you don’t want to be broke at the end of the month, here are some simple tips to help you curtail your expenses.
1) Find where the leak is
You have to find out where you are going overboard with your expenses. Is it food and clothes, frequent outings with friends, unnecessary shopping etc.? Before spending make a clear distinction between your needs and your wants. If it is something that you need, you don’t have to think twice before spending on it. But if it is something that you want, you can probably delay spending on it. Don’t buy something just because there is a sale going on, or because it looks attractive or because your favourite celebrity is promoting it. Always use a check list while going to shop and save yourself from impulse buying.
2) Save first, spend the rest
The world’s greatest investor Warren Buffet once said `Do not save what is left after spending; spend what is left after saving’ and it is truly a great advice. When you get your salary, the first thing you should do is set aside a certain percentage of your salary every month towards saving. You can then use rest of the money to first utilise it to pay your necessary expenses such as groceries, bills, rent, etc. The money left after this is all yours for your indulgence. This will help you from over spending and will also inculcate a habit of saving.
3) Create your budget
One of the best ways to control your expenses is to make a monthly budget. Start by tracking the amount you spend each month on various things. Then create budget to put a cap on the amount you can spend on different categories. You will need to allocate the amount of money you can spend during the month on things like daily expenses, food, utility bills, entertainment, etc. with this you can find out which the categories in which you are over spending and whether it can be reduced. There are various mobile apps which allow you to keep a record of your expenses or you can use the good old pen and paper.
There are also other small ways through which you can reduce your expenses. This includes switching off electrical appliances when not in use and using energy efficient appliances, asking your mobile/internet/DTH service provider to suggest best plans for you, walking or using public transport whenever possible, controlling use of your credit card and so on. Sometimes it is just the small changes that can make big difference.