Success in 12 Months: Is There a Hole in Your Bucket?
Welcome to the second week of Month 11 in the “Success in 12 Months” blog series! This month, our focus is on the emotional hot-button issue of money.
So, how did your expense tracking assignment go last week? Did you find yourself holding back on an impulse-buy because you were going to have to track it?
Funny how that works isn’t it?
I’m sure you had plenty of other expenses you tracked.
This week’s assignment is about whittling away at those expenses. Review the items and decide which “buys” were required and which were purchased simply because of an impulse or bad habit.
Your Weekly Action Step: Your “Bucket” List
This week, you are going to assign each of those expenses to a “bucket.” Use a spreadsheet program or simply use a new sheet of paper and create a list of expense buckets down the left column.
For example:
The first grouping will be for your home: HOME – mortgage/rent, home equity loan, property tax, insurance, maintenance, utilities, gas and electric, heating, water, home phone, cell phone, cable/TV, Internet, MAINTENANCE – repairs/upgrades, yardwork, snow removal, TOTAL MONTHLY HOME EXPENSES.
The second grouping will be for food: FOOD – groceries, dining out/take out, coffee, TOTAL FOOD.
The next group will be for car and transportation expenses: CAR/TRANSPORTATION – Car loan, maintenance, tolls/parking, car insurance, public transportation, TOTAL CAR EXPENSES.
The next group will be for insurance costs: INSURANCE – health insurance, life insurance, disability insurance, long-term care insurance, dental insurance, TOTAL INSURANCE.
The next group will be for miscellaneous spending: MISCELLANEOUS SPENDING – childcare, private school tuition, entertainment, hair/manicures/pedicures, club memberships, computer equipment and games, clothes, gifts, vacations, out-of-pocket expenses, pet expenses, subscriptions, charitable expenses, TOTAL MISCELLANEOUS EXPENSES.
Your final expense group will be for credit card debt: OTHER LOANS/DEBT – credit card one, credit card two, credit card three, other loans, TOTAL OTHER DEBTS.
Finally, put down any amount that you pay monthly into savings accounts such as your emergency savings account or your 401(k) contribution or your self-employment tax payment account.
Now that you’ve captured your total monthly expenses, put the numbers in next to each label and add those up at the bottom of the column. Now you know your total expenses.
In another column, break out your total monthly income from paychecks or sales or Social Security. Add in every type of income that you receive monthly. Total that and you have your total income per month.
Subtract your expenses from your income to find out whether you’re spending more or less than you’re making each month.
Go through your week’s expenses and classify each as a “want” or “need.”
That’s it for this week. We’ll take this further next week.
As I always say, share your thoughts and your progress, leave a comment below or e-mail me and let me know what’s been happening for you. I’m investing in you and want to support you in your success!
