Give Yourself a Personal Finance “Halftime” Talk
A baseline for meeting your personal finance goals is to understand what is actually coming in and what is going out of your bank account each month. Far too many people let deposits and automatic payments go through without a thought or care. Money Athletes know that you need discipline and attention to detail to build the life you want long-term.
How do we do this? Build a “halftime talk” into your monthly routine. Pick a date – any date – each month and briefly review your bank and credit card statements. Oftentimes, this will only take 15-20 minutes, and many banking apps will do some quick analysis for you as well. Money Athletes always know the score of the game, and in this case, the “score” is your monthly net income: your total income minus your total expenses. Know this number and build your financial goals off of this number.
An Easy Tactics Shift
You’ll be amazed at what you find doing a brief review of your statements. Last month, this TMA blogger found two subscriptions that I didn’t use or should not have charged. Take a look at this C+R Research study – when asked, people estimate their monthly spend on subscriptions to be about $90, when in reality the real number is closer to $220! Some streamers and subscriptions sneakily raise their prices month over month (Netflix is charging extra for password sharing now!). I also found an error in a gym membership charge and called to have this charge reversed. Ten minutes of time saved $125 last month and every month going forward — compounded out, that’s $1,500 per year. If you don’t do this often enough, these mistakes will add up and be MUCH harder to reverse if in error.
A Longer Term Play
But only looking for a billing error or forgotten subscription is just part of the magic of this monthly financial charges review. Think about your especially frequent charges – ask yourself: “what makes up the majority of my discretionary spending?” These are your non-necessities (and excludes rent/mortgage, car payments, utilities, student loans, etc.). Perhaps it’s a lot of restaurants or travel…or shopping. Think about what is truly meaningful to you and what brings you joy.
Money Athletes don’t deprive themselves of life’s greatest pleasures – read our “Balling on a Budget Series” for more here. Nor do Money Athletes advocate for cutting back on what defines you, such as important hobbies, people, education, etc.. If you love travel, you should spend money on it (within reason of course) and do so without guilt. But for purchases that aren’t key to your well-being or your passions, think about how you can cut back. This will maximize your savings and joy per dollar. It’s all about making your money work harder for you and making it stretch as far as it can!
We encourage you to schedule this personal “halftime” talk into your month’s routine – you’ll start seeing benefits almost immediately and you’ll put yourself in a position to win the big game!
