Spending Plan

Spending without planning is setting yourself up for disaster.

Everyone needs a strategy for paying for what you buy. Paying for things using a credit card only defers the day of reckoning. DON’T pay interest on anything that is not an investment, if you can at all help it.

To get control of your finances, the best strategy is to plan your discretionary spending.

First, list your take-home pay/income. Then subtract your fixed costs: rent, insurance, utilities, groceries, etc. The money that is left over is your discretionary income. If you don’t have any money left over, you need to either increase your income or reduce your expenses.

Once you know how much you can spend, then you can decide how you want to spend it. Prioritize by what is most important.

One tip: Pay yourself first by putting some money aside in savings. Ten percent of what you earn is a good start.