What Is It You’re Spending Your Money On?
“Where is all my money going?”
It is likely you have asked yourself this before. Many people ask the same thing, especially when the bills are do. When all the money is gone and there are still bills you need to pay, where did it all go?
If you’re not tracking your spending, don’t worry you are not alone. Free tools like Mint allow you to do this and are rated highly by consumers everywhere. The United States Department of Labor often tracks consumer spending and every one in awhile they publish their findings on the spending habits of U.S. citizens.
According to a recent study published by the U.S. Department of Labor, the average household of 2.5 people earns roughly $63k/year and spends around $50k of that, with the remaining going to taxes. The study also states that 65% of households own their home, have one full time job and one part time job, and drive two vehicles.
Obviously the majority of money spent by the average household is on their home, and the next being transportation. This comes as no surprise as these are the two most costly things in most every household. But what about the rest of your income, where is it all going? Sure there is food, gasoline and healthcare, but that isn’t taking up everything is it?
The fact is that the majority of Americans are spending too much on entertainment and luxury items, then they’re winding up in too much debt with few options to dig themselves out. When you’re about to buy those new pair of designer shoes, or take that two-week luxury vacation, you should ask yourself if you’re going overboard or living within your means.
Creating a simple budget is not as hard as it might seem, the hard part is sticking to it. Some of the top financial advisors always recommend you keep just one credit card, and never spend more than 60% of its limit. Credit card companies will consistently raise your limit as you make timely payments, but don’t fall into the trap. You will simply be paying more money in the long run, and are better off saving your money and paying cash for your next large purchase. Most Americans facing financial troubles don’t live within their means and have never created a budget before. With some simple research and planning, and using some of the many free online budgeting tools, you’ll be on your way to financial prosperity in no time.
We have all been in a tough financial situation before, or made some type of spending mistake. It’s a tough position to be in, and many people don’t know where to turn if they need access to money quickly. Cash advance loans can be a good option if you’re in desperate need of a short-term loan. Most lenders are able to get you the money you need the same day you apply. These types of loans should never be used for long term financial relief, and have a very specific purpose. Maybe you were hit with an unexpected bill, or your checking account has been over drafted. Rather than facing costly fees, a cash advance loan can cover you until your next payday.
If you feel like there is no way out, think again. If you begin to budget your money, track your spending and start making smarter purchases, financial bliss will be around the corner.
This article was written by Libby Johnson, a regular contributor to Cash Centric, a website offering helpful resources to consumers during a financial emergency.