(MoneyHippo.com) – Living paycheck to paycheck is a reality for most Americans, and it seems no matter how many times wages increase, the funds just disappear. The only way to avoid that scenario and properly manage your money is to track it. Having a budget might not sound attractive, but if you don’t track the money coming in and leaving, the little expenses here and there will whittle away at any extra cash you might have had. Ideally, you want to spend less than you make and use the surplus to build wealth – but how?
The simplest way is to create a budget accounting for every dollar to find out exactly where your money is going and create a plan to control the direction of your cash flow. A spreadsheet can be a valuable tool to make a money management plan. Record your income and list every expense you pay each month. Don’t forget to build savings, emergencies, investments, and fun money into the plan, and consider your long and short-term financial goals.
By including not only current expenses but goals into your budget, it will be easier to see where you spend your money and track the achievement levels toward your goals. Tracking your income and spending habits might take some getting used to, but if you want to manage your money effectively, this is a simple and efficient way to accomplish that feat.
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