Fix the Leaks in Your Budget – Make your Finances Efficient

One main misconception about saving money is that “I don’t make enough to put any extra aside, all of my money goes towards bills.”  While this may be somewhat true, in general we all have that extra money that should be used towards savings that is trickling out of your account in the form of several small purchases.

Many times we don’t even realize how much we are spending on the subtle things like ATM fees or a night at the bar.  One tool to help you keep track is a website called www.Mint.com. 

Mint links to all of your accounts; checking, credit cards, loans, etc. to give you real-time updates of how much money you have available in your account.  It will also give you a budget, track your expenses, and provide you with warnings when you are close to over-drafting an account.  When you use a credit card or debit card it is easy to forget how much money you are actually spending.  This will help make you aware of the issue before it becomes a problem.  Preventing bad spending will save you a lot of money in the long run.

If you notice you have a bank account charging you a maintenance or ATM fee, get rid of it.  The bottom line is, if your bank charges these fees they are not competitive and it is time to move to a business that does right by its customers.  Credit Unions generally pay a better interest rate and tend to have fewer fees.

Recurring charges for magazines, tanning, and unused gym memberships are other “bills” to get rid of.  Eliminating these automatic purchases will provide you with some excess cash each month.

Once you eliminate these bills and charges, allocate this money towards savings.  Do not fall into the trap of making another big purchase, or living more luxuriously.  The lavish lifestyle will come in time, but first we need to build a good foundation with savings.