Being able to have enough money to buy the things you want is not about how much money you earn, it is about what you do with what you earn.


The first step in managing your money is understanding how you spend.

To do this, keep a record of your daily spending for a pay period. So if you are paid per month, keep a record of all you expenses for a month.

At the end of the month carefully look at your record. Note what items much of your money is spent on, what you spend on the least etc.

Now go through this data again and see what items you can spend less on or cut out totally.


You are now ready to make a budget. On one side of the page, outline all your income for a pay period and on the other side, outline items you will need to spend on. On the expenditure side, decide on a target amount for each item, based both on 1. what you usually spend and 2. what you would like to spend on the item so you can save some money.

Included in your budget, should be an item called saving. Add it and make a target for the amount you will put toward this item for the coming month.

If you realize that you have been spending more than you are earning, you have to two options:

1. Increase your income

2. Reduce your spending



1. Before taking on a new expense such as going back to school, make sure you have a plan for how it will be financed.

2. Create a plan B for this new expense. Remember, the economy is unstable and almost unpredictable. Your plan B should be as solid as your plan A.

3. Understand what it means to be able to afford something. To be able to afford something does not mean that you have the money that is one the price tag for the item. It means that you will be able to purchase the item without feeling a sense of strain. It also means that you will be able to comfortably find the additional costs which may come along with the item. For example, the price tag on a car does not account for the full cost of a car. Also consider maintenance and other costs.

4. Live one level below your means. If you can afford to live on rung number 10 of the ladder, live on rung 9 so that if you have a sudden reduction in your income, you will not have much change in your living standard which can be very stressful and at the least- embarrassing.