How To Spend Your Money Wisely

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Many individuals at the end of the month find it difficult to tally their expenses. To overcome this financial difficulty and manage your budget wisely, you do not need a daily money manager. Instead, divide and review your daily budget.

An example

As per the census conducted in 2007, an average American family includes three people and their average expenses taken together are $5,000. This amount does not include the taxes. Therefore, after all the cuts, let us assume that your family’s take home income is $3,000. Now let us divide this amount. Let us divide this income. The expenses include about $1200 for housing, $500 for provisions, $300 for transportation, $250 each for medical needs and other living expenses, $100 for recreation, $75 for your life insurance policy, $50 for clothing materials and $75 as savings.

From the above expenses, some are not to be touched. That is, the expenses for health, housing, savings, life insurance, utilities and transportation are fixed and you cannot make any changes. Therefore, let us consider only the remaining expenses. You can make changes to these daily expenses and have a control over them. Therefore, considering a month with thirty-one days, your daily financial expenses are divided as $16.13 for groceries, $8.06 for your living expenses, and $3.33 for recreation activities and $1.61 for clothing. We have assumed the expenses on an average basis and your budget for these expenses may be different.

Now as per the breakdown, you have $16.13 for each day for a three-member family. This figure comes to $1.79 for every single meal. However, an average meal from a restaurant costs you about $5. A meal for three can have chicken leg quarter, which costs $1, baked beans of $1.5, milk that can cost you $.38 for three glasses and dressing of $.99 and altogether can cost you $5.37 for the family of three or $1.79 per person.

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When it comes to living expenses, they vary from household to household and individual to individual. Living expenses can include expenses for hardware items, pet care, gardening, sporting equipments and the costs for your haircut and the expenses for your hobbies. Many people fund these expenses weekly and assign separate funds for each category. This method gives you a clear-cut idea of how much fund you have at the end of every week. Some people make use of their credit cards while some others use their debit cards to cash these expenses.

If you use your credit cards wisely, it can benefit you in a number of ways and boost up your credit scores. So, spend your hard-earned money wisely and you can be a daily money manager yourself.

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