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)

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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

    • Emergency funds

Your long term savings should not be mixed with your daily expenses

Remember, ALWAYS "Pay yourself first"

• For more about this:

  • Read:

    • Investopedia - Pay yourself first concept

    • Rich Dad, Poor Dad- Robert Kiyosaki

• 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

1. Will reduce the chances from overspending on a daily basis

2. 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.