Financial Sins. Lets face it. Everyone does it, but most of us still don’t realize that we do. It might be that deliciously warm morning latte at the local coffeehouse, online shopping, spur of the moment weekend getaways, or just hailing a yellow cab instead of taking the much cheaper, public transport. Financial sins are just one of those things where we spend our money on, despite knowing that we probably shouldn’t be. Sure, I do believe that we should pamper ourselves from time to time so that we can just live in the moment. However, if we don’t have some healthy boundaries for our when it comes to our spending, these little sins can really add up to quite the sum and begin presenting problems in our everyday financial lives.
Similar to how it isn’t good to eat that extra large bowl of chocolate covered ice cream sundae every single night after dinner, it isn’t a good idea to allow your spending sins to take full control over your day to day spending tendencies. Having a game plan will really help you in identifying any spending sins that you often find yourself making, and make sure that you set concrete boundaries when it comes to them. So here are a few ways to identify, tackle and control your financial sins. Ready, set, go!
For the next three months, track your finances. This is probably one of the simplest ways to know exactly where your hard-earned cash is going to each month. Just carry a notepad and pen around (keep them handy in your purse) for the next 90 days and each time you whip out some cash or flash that credit card, jot down the amount you spent and what exactly you spent it on. Oh, and don’t miss out those online purchases! Yes, it is very true that this might not be the sexiest or coolest thing in the world to do, but it can honestly be one of the best tools used to learn exactly what is really going on when it comes to your spending.
After the three months is over, review your spending and analyze where your money is going. Have you noticed any trends and over-indulgences (your financial sins) in your spending over the past three months? Perhaps you might have found out that you spend approximately $200 per month on these random purchases at Ikea, yet you didn’t actually allocate that much when you drew up your budget for the month. This might just be your financial sin. Or perhaps you are a victim of shopping. I’d say that the majority of us often find ourselves shopping around for outfits, home goods, jewelry or books regularly and that just makes it that much easier to overspend without really even realizing it.
The main reason behind discovering your financial sins isn’t to completely get rid of spending altogether. Rather, it to help you to maintain some healthy boundaries for any areas where you have the tendency to go out of control (For me, it has got to be buying bulks of eBooks at a time or scouring all the little online boutiques when sale season comes). It is just so simple sometimes to just click to your heart’s content and purchase whatever tickles your fancy to the point that before you know it, your spending for the month far exceeds your budget (Sometimes I can even spend up to $100 just on eBooks alone!) So now that I am aware that eBooks is one of my financial sins, I make sure that I allocate some money in my spending plan for it, however I still try to keep track of my spending to make sure that I do not exceed a $50 limit each month This way, I don’t feel limited and still feel incredibly excited that I have the freedom to spend my hard earned cash on whatever online read catches my eye.
Once again, the main reason behind trying to find out your financial sins isn’t to suck out all the fun, exciting things in life. Instead, it is to make sure that you are in full control of your spending so that you will be able to still have money left to go into your savings in order to fulfill any financial goals you may have. If you enter the world of finance without a clear game plan, it is extremely easy to get pushed into spending all your money and not have any left over to set aside. However, as modern, financially savvy women, we have to make sure that we are able to save for the future, even if its just $100 per month. Taking full control of our financial sins makes sure that we will be able to save successfully.
So what are your spending sins and how have you managed to keep them under control?
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.