Posted by: thomstrat | March 9, 2010

Managing Money Requires Visibility

This article is available in its entirety here. I’m too lazy to reprint it all here.

Many people will tell you the first step in managing your money is to create a budget. While I do believe budgets to be important, for many people the first step is something much more basic: getting in the habit of tracking your money.

This is not as easy as it sounds. In our highly-competitive society, there are more options for anything than we really need or know what to do with. For example, consider all the different options for simply paying for a purchase:

  • Cash
  • Check
  • Credit card
  • Debit card
  • Money order
  • Gift card
  • Credit
  • Electronic Funds Transfer
  • PayPal

I’m sure there are more, but you get the idea….

Continue here for tips on managing this monster (opens a new window)

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Responses

  1. I really like having my “concrete” savings in a separate bank from my checking and “slush” savings. I totally agree, though. I recently went to a cash system for all my groceries and discretionary spending. I seeing the money physically leave my hand makes me much more accountable for what I’m spending on what. I don’t use credit cards at all, and my debit card is for emergencies only. It’s been much better for me that way.


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