While reading some topics about money and finance from a news site today, there was a section dedicated in allowing people to voice ways on how they manage their money. What caught my attention was a comment about someone who was earning around $30,000 to $35,000 a year and claimed that it is barely enough to get by and how he feared that if he did not find another source of income that he would be unable to continue living a comfortable lifestyle and will be unable to ever buy things like a car or a house.<\/p>\n
These types of scenarios are always interesting as I’ve seen many people who get by with less than that and still they have things such as their own car and a house. In my opinion, the solution is pretty simple as you just have to know how you are spending your money and whether or not you are using it wisely. For example, I mentioned before on how one of the biggest culprit for most people in terms of spending a lot of money is constantly eating out instead of preparing their own meals. As an example, let’s pretend that a person went to a restaurant for all of their meals everyday. Based on a rough estimate of prices from fast food places and restaurants, a typical day could be like this:<\/p>\n
Breakfast: $5.00
\nLunch: $5.00
\nDinner: $10.00<\/p>\n
That makes it about $20 a day for food. Assuming the person did this everyday for the whole year for 365 days, that would mean one’s food bill would be $7300 for the year or $608 a month. I think everyone knows that with $608 a month you can buy a lot of food that will keep you going for more than a month. If I was to just use breakfast for example, let’s say you buy a 500g box of cereal for $5 with 4 litres of milk for $4 which lasts you one week. Basically, with roughly 4 weeks in a month, your expense for eating at home would be $36 as opposed to $140 if you were to eat out instead. That is almost 4 times less the cost in food expense. If you were to look at that for the whole year, that would be $432 for eating in and $1825 for eating out. With that extra $1393, it’s not surprise that a person who earns less overall can still save a lot of money.<\/p>\n
Another important factor that I personally think a lot of people under utilize to help them understand their spending habits better is by getting assistants from experts or professionals who specialize in a certain field to help them make wise purchasing decisions. For example, a common scenario is a student who is not technically savvy needing to buy a new computer for school. So, he walks into a store and sees the prices for various models. After seeing the price ranges, he opts for what seems to be the medium price one and spends about $1100. <\/p>\n
After it is all said and done, he now has a decent computer while mourning over how much money he had to spend on the computer which as a result made him broke from buying any other things. Now if he was to give that $1100 to someone who knew a lot about computers, I bet most computer enthusiasts could create a monster computer for that price or on the other hand they could also create a similar set up of what they bought for much less. I’m positive that if you look around your social circle and networking contacts that there is a good chance that you can find an expert for almost every category and industry to help you in these types of scenarios.<\/p>\n
You don’t have to be some kind of oil tycoon or lottery winner to be able to afford the things that you want. Regardless if you make a million dollars a year, it all comes down to how you spend your money as even millionaires can end up being broke.<\/p>\n
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