Last year, I did something that many people might consider crazy: I took control of my personal finances. I decided that I was sick of feeling stressed about money and constantly living paycheck to paycheck. So, I started tracking my expenses, creating a budget, and finding ways to save money. And you know what? It was tough, but it was totally worth it.
So in this article I will share what worked for me and how I did it.
What are the benefits of tracking your spending?
If you're like me, you probably spend a lot of time scrolling through social media, dreaming of all the things you wish you could do if only you had more money. Maybe you want to travel the world, buy a house, or start your own business. But the truth is, personal finance is not just about having more money. It's about having more options.
When you take control of your finances, you open up a whole world of possibilities. You can start building an emergency fund, invest for the future, or save up for that dream vacation. You can also make choices that align with your values and goals. Want to give back to your community? With better financial management, you can make that happen.
More often than not, I have started to think through what I really wanted to do. And that's the big takeaway from tracking and managing your spending, you can prioritize what you really want and cut out what you don't.
I want to control my financial life. Where do I start?
Managing your investments can be scary, especially when your targets are far away. They just seem really HUGE and impossible to achieve.
It might even keep you up at night or constantly a source of arguments with your significant other.
It can be overwhelming to think about, especially if you don't have a background in finance. And then there are others, people who even have an MBA, and are still scared of this subject.
But trust me, it's never too late to start. You don't need a degree in accounting or be a math genius to manage your money effectively.
All you need to do, is start tracking your expenses. Before doing anything else, just write down all your expenses on a google sheet (or whatever works for you).
Over 3 months, only track your spending and you'll notice patterns start to emerge.
Now this is where the magic happens. Let me tell you what happened to me.
In my case, I found that I was spending too much on outside food (almost 12k - 15k per month!) And it was mostly happening on the weekends. And then came the first idea.
I made every Saturday = Cooking day. I would plan, open YouTube for some nice recipes, buy groceries and cook. For me it was a 3 hour long activity, at the end of which I would not feel like going out any more. The food I made cost me less than ordering from outside, and I followed recipes with less oil and lesser calories. That was a win-win in every direction! I ended up reducing my outside food spending to almost a third (though I didn't manage to lose any weight yet :) )
Seeing the benefits over time
Over time, I realized that I was spending in a lot places that I did not really want to, and started to cut down. Eating a lot of outside food, impulse purchases on Amazon that I didn't really need. Most of the money I was saving, was put it into a monthly SIP.
I also joined a gym and bought new badminton shoes and rackets. And yes, I am going to play regularly too. Just being aware of what you want to prioritize makes everything easier.
More than anything else, having enough of a financial cushion, will bring a peace of mind for those in private sector jobs!
So, what are you waiting for? Take that first step towards financial freedom and start building the life you want. And remember, you don't have to do it alone. Reach out to your friends, family, or even financial professionals for support and guidance. Together, we can all achieve our financial goals and create the lives we've always dreamed of.
We also write about various algos used to invest and improve your return, which is the next step after building savings. Learn more at https://www.algoinvesting.in/
