I keep a household account book, but I cannot improve the way I spend my money.
I don't know how to improve.
Do you have such problems?
Sometimes it's hard to quit wasting money even when you're trying to improve your spending, isn't it?
Let's start by keeping a household budget and figure out what kind of waste is lurking in the system.
By visualizing the waste of money, you can make purchases with a basis for judgment and change the way you waste money.
Steps to visualize wasteful spending
It is hard to judge what is a waste of money, because each person has a different value, right?
Visualize your personal investments, essential items, and luxuries.
Record in the household account book
If you are not sure what kind of money you spend on a daily basis, start by recording it in a household budget book.
I offer a free Excel household account book that can be categorized into essential items, personal investments, and luxuries.
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Excel household account book that shows what you really need (free template available for download)
I keep a household account, but I don't know how to improve it. Do you have such a problem? This Excel family budget book solves ...
Categorize how you spend your money
Calculate the percentage of each essential item, personal investment, and luxury item.
Check to see if the percentages for luxury items are too high.
Consider the causes of wasteful spending
Once you've identified the money wasters, think about the causes.
Causes of waste
- Stress
- Habit
- Vanity
- Lack of space in the mind
To change behavior, we must first recognize the cause and find a solution.
If it is due to a habit, find out why the habit was formed and whether there is an alternative habit that can be replaced.
Set the luxury index
At first, it may be difficult just to record the details in the household budget, but after you become a little more familiar with the system, you can record the details of your luxuries as well.
Rate the contents of your monthly luxury record on a 5-point scale.
Sorting criteria
- Whether or not you feel happiness (excitement)
- Will you regret it later?
- Do you want to make the same choice one year from now?
Set a luxury budget
I hope that by rating them on the luxury index, you have a clear idea of what you need and what you don't.
Make a list of not only what you have recorded, but also what you would like to do in the future.
For example, if your living expenses are ＄2,000 and luxury expenses are 5%, your budget would be $100, and 10% would be $200.
In order to make do with a limited budget, it is desirable to have it consist of luxuries with as high an index as possible.
Among the luxuries on the luxury list, those with large expenses, such as travel expenses, should be managed as special expenses.
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How to set Special Expensenes in the household budget(Free Excel template available)
Do you ever wonder why you spent so much money when you record it in your household budget and look back? One of the reasons ...
It means having a standard of judgment.
As for items where the expense is small, you might think that this amount of waste is acceptable. You may think, "If it's such a small expense, it's fine.
It is true that the impact is small compared to the reduction of fixed costs.
However, by carefully analyzing and evaluating how you spend money on a daily basis, you will be able to make purchases according to your own criteria.
Determining whether an expense is truly necessary, rather than just buying something for the sake of it, will also improve the quality of your life.
