Introspection - A detailed look at your monthly expenses and debt

Since I just covered out of sight out of mind in my last blog post I wanted to follow that up with something called introspection.
Introspection is looking inward a self examination. One of the most costly things in life is a lack of paying attention to every little detail.

This is where introspection plays a huge role. What we are about to go over is your monthly expenses. The majority of people I talk to all have the same bad habits. They have everything set up with automatic bill pay. This is where bills are paid automatically after they are received. The money is instantly withdrawn from their bank accounts. Technology the ease of never having to write a check again.. This system is great for avoiding late fees and penalties on credit cards, and making sure your gas and electric bill are paid every month and what ever other bills you have set on automatic bill pay.

The down side is the majority of people do not even realize how much they're paying every month, they never even look at the bills to see if the amount is correct. The only thing people focus on is the fact that it was paid on time. This next exercise is something you should start doing if you are not doing it already. Starting in the beginning of the month. You should start keeping track of every single expense you have. Keep receipts for all of your purchases. If you have something on automatic bill pay print out a copy of that bill.

You want to see how every penny of your hard earned money is spent. I can say with a great amount of certainty that you will be amazed by how much money you are wasting each month.

Now what I want you to do now is get a pen and a piece of paper and write out each individual expense you have on a separate line.

Here are some examples

Mortgage

Rent
Home owners insurance
Renters insurance
Gas Bill
Electric Bill
Water Bill
Cable Bill
Internet Bill
House Phone Bill
Cell phone Bill
Lease on your car
Insurance on your car
Maintenance Bill for your car
Gas card Bills
All credit card Bills
All store credit cards as well
Pet supplies
Veterinarian Bills
School supplies
Doctors Bills
Medication Bills
Student loans
Bank loans
Food Bill
Clothing Bill
Kids expenses
Bus Pass
Bus Tickets
Subway cards
Phone cards
Make a detailed list of everything you spend money on !!!!!

Save every single receipt and log your expenses in a notebook every single night as soon as you get home No Excuses. Also there's No Excuse for losing receipts, buy a small wallet and put them in their as soon as your are done with each transaction. Also check each receipt for accuracy mistakes happen.. At the end of each week you will be able to see how your money is being spent. You will be able to get an exact account of how much money you are spending monthly at the end of each month.

This exercise will also show you how much debt you have. If you owe money on credit cards, or store cards like Macy's Or Sears pay them off immediately. If you are constantly making the minimal payment on credit cards or store cards all you are doing is paying off the interest.. The bulk amount of the money you still owe is still there.. Next month that bill will look about the same as it did last month if you're only paying the minimal amount.. So focus on paying off all the money you owe, even if its just one card at a time..

The most important thing is that you get it done.

Keeping receipts and logging them into a notebook should be something you are doing daily. This is something that should become a daily discipline. You do it without thinking about it, it's an automatic reaction the second you make a purchase ask for a receipt then check it for accuracy then immediately put it away. As soon as you get home open up your notebook and log it in..

The sneaker company NIKE said it best “ JUST DO IT ”

Once this system is implemented into your daily routine you won't think twice about doing it when you start your own business. Create good habits now and they will serve you well in the future. 

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