How to budget so you can save & invest more at the end of the day.
KEYPOINT:
🔑 The template attached helps you save extra unused money at the end of the day, so you can use them for long-term investments.
TOOL:
🛠️: 💵 Monthly Budgeting template (Maximizations.com) (download to use)
First things first, open a sub account for "untouchable funds"
Check with your bank how you can open a sub account
many of them offer these which do not require
maintenance of certain amount
monthly fees
etc
(Objective):
this sub account is for your long-term savings, ie:
Investment funds
Remember, ALWAYS "Pay yourself first"
For more about this:
Read:
It is a game changer.
Then, determine your monthly budget per your lifestyle
Click here for the budgeting tool
First, list out the:
first & last day of the month on Column L
for example: if its the month of August:
put 1/Aug/2022 on cell L5
and 31/Aug/2022 on cell L7
Next, List out your monthly expenditures items on Column D, into the 2 segments of:
i) Fixed monthly one-off expenses
Rental/ Mortgage
Phone bill
Gym membership
Subscriptions (Netflix, Spotify etc)
add others where you see fit
ii) Expenses which are incurred on daily basis
Daily meals:
Breakfast, Lunch, Dinner
Groceries
Transportation
Entertainment
General expenses, etc
add others where you see fit
and their respective expenses (in $) in Column E.
And track all your expenses in Column G.
Under "Daily expenses"
exp: after paying your monthly rental of $1000, list it out on cell G6,
and you can see the Balance left on cell F6 will be 0.
Under "Daily expenses"
Track your daily expenses on Column G
For exp: if you spent:
$5 for breakfast
(you would have $2 extra saved at the end of the day)
$7 for lunch
$10 for dinner
(you would have spent more than $3 of your allocated budget)
Column H will show you the available balance left for the day, so it will serve as a reminder to not overspend.
Benefits of this budgeting system
Will reduce the chances from overspending on a daily basis
for any excess money which were unused
they could be moved to your "Long term savings" acc
Investment funds
Emergency funds
Although it ($2 saved per day) may seem insignificant,
it can add up to extra $60 (or more- for exp) in a month
invested & compounded,
this small amount can make a HUGE difference over the long run.
Refer to:
Benefits of fractional shares investing - basically allows you to invest as little as $1
& the returns you get when buying stocks that has fallen from their all-time high prices.
It is a great habit that has worked well for me.
