Keep a Spending Log

In these difficult economic times, it can be very hard to remain positive or optimistic... if we're focused on the wrong things. Let's face it: when times are good, many of us get focused on "stuff". We mortgage bigger houses. We buy nice furniture on credit (0% and no payments for a year). We splurge on that 52" HD TV. We take the family out for a nice meal once or twice a week. We... well... you get the picture.

I'll admit that I was in the same boat. Of course, much of my predicament happened because my job moved south of the border so I had to move from Michigan to El Paso, Texas -- and ended up with a huge mortgage (to get the type of house my family needs) and a cottage in Michigan that we can't unload for anything! But I digress.

The point is, when times were good we tended to be focused on acquiring more "stuff". Unfortunately, most of us did the acquiring through the use of credit. Now we find ourselves with limited options because our bills exactly match our paychecks. There is no money left at the end of the month. In fact, there is often more month left at the end of the money! For all intents and purposes, we've become serfs, indebted so much to the banks and lending institutions that we can't leave the fiefdom.

Career and Personal Finance is one of the Triple-T Key Components because it's absolutely critical to our overall freedom. If every cent I make is needed in order to pay my bills, do I have the option of changing careers? Not unless I can move to a better paying job in a different field, and that's rarely possible. When I'm a slave to my paycheck, my options become few.

But all is not lost. As overwhelming as it may seem, I can still get things under control, and the first step is to understand exactly where all my money is going. Just as the first step towards losing weight is to keep a food log, the first step towards taking back control of your finances is to keep a spending log. What I did was put a little notepad and pen in my pocket and carried it with me wherever I went. In that notepad I jotted down everything I spent money on, whether it was a coffee in the morning, a salad for lunch, or a pack of gum from a vending machine. Once I really started noting where every penny was going, I was amazed at how much money I frittered away on a weekly basis.

After reviewing my spending results I was able to make some quick changes that have had an immediate bottom line impact. For example, by setting up the coffee maker the night before, I had hot coffee ready in the morning and didn't have to stop at the Circle-K on my way to work, which immediately saved me almost $8 a week! That's about $400 a year, just by changing my routine a bit. And don't get me started on lunches! Wow, can you save some money there!

Career & Personal Finance Tip #1: Keep a spending log and track every penny you spend for at least a month. Using that info, start making changes that reduce or eliminate your discretionary spending.

Career & Personal Finance Bonus: Be on the lookout for convenience spending, such as my morning coffee purchase. When we have more money than time, it might make sense to pay for convenience. But when we're trying to cut our spending, convenience may very well be the first thing that we need to stop buying!

Train hard but pray harder,
Brandon Jubar