We earn money from all kinds of sources like salary, interest on investment, mutual fund, or any other kind of investment. There should be a correlation between spendings and savings. You can’t just go on spending what you get on a monthly basis. You need to do savings from our income for future requirements like children’s education, illness, for old parents medical expenses, for vacation, marriage, etc. Both spendings as well as savings needs to be done smartly. For this here we look at few tips to track your spendings and your savings.
The first thing you should do is to do savings for a certain part of your income. Save in different parts like insurance, FDS, Post office savings, mutual funds, or any other investments. Keep a track of investment where you kept. Keep track of records of the bank, insurance companies, or any other investment firm. If you find anything wrong immediately switch over to good options. Your savings needs to be observed properly. For savings, a systematic investment plan is very important. You should be able to arrange money when it’s required.
Then comes spendings. Whichever amount kept for spendings, needs to be tracked properly. It is an easy but tricky task. Few tips to track spendings are discussed herewith.
List your regular monthly bills
Make a list of the monthly payments. It includes mortgage loan EMI or rent, car loans, utilities, mobile expenses, internet, household expenses, education expenses, etc. You can keep a watch on this list and accordingly can make changes or can rearrange expenses if you wish so.
Track your out of pocket expenses
Keep the track of the money you spend for a week on groceries, gas meals, clothes, personal things, entertainment, and even snacks, tea which you can add. Keep all receipts and keep records of payment done, either credit card or cash.
Review the numbers
You have spent money on different things. Now we try to look at savings by using simple and small things. You can do a minimum no. withdrawal from ATM to avoid fees or you can curtail certain expenses like internet, cable, mobile, outside food, and by curtailing frequency of outing.
Review your big expenses
You can keep track of the big spendings in the past year. The special expenses like home renovation, car up-gradation, travel, education, expensive furniture, and electronics, etc. This big spending plays a vital role in your finances and you need to track it by analyzing and taking necessary action in spendings. If you look at these irregular costs, it will help you plan better for emergencies.
After reviewing all your expenses by curtailing certain things, you need to concentrate on savings. You can upgrade your savings by investing in an emergency fund or increasing your retirement savings.