How to Build a Better Relationship with Money

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For many people, money is a thorny subject. It’s also one that’s surrounded by taboo and secrecy, with most people feeling uncomfortable talking to others about finances.

Unfortunately, because we’re not even taught about money in school, this makes it hard to start understanding how to control it better. 

Having a good relationship with money isn’t totally about how much you earn. It’s just as much about how you manage the money you have. When you’re in control, that’s when your relationship with money starts getting better.

Start a Personal Spending Record

Just like professional accounting, looking after your personal income is about keeping tabs on what’s coming in and what’s going out.

It’s pretty simple, taking just a few moments each day. All you need is a notebook or a spreadsheet if you like working digitally. Both methods are the same and give the same results.

In your notebook, have four columns. Name them ‘Date’, ‘Item’, ‘Cost’, and ‘Balance’.

Start by filling in the ‘balance’ column with how much money is currently in your bank account. This tells you what’s available for spending, and you’ll either add to or subtract from the amounts you enter in the other columns.

  • In the ‘Date’ column, write down the date any transaction happens. 
  • Under ‘Item’, write down what you bought (or for money coming in, write down where it came from, such as salary or wage).
  • in the ‘Cost’ column write down the amount of money involved.

Every time you buy something, fill in the columns and subtract what you spent from the ‘Balance’, so you keep a running total of money available.

One other point for the ‘Balance’ column, in to not forget your direct debits. When you start a new sheet at the beginning of the month, you can subtract all the direct debits straight away, regardless of when they’re leaving your bank account.

Making Money Work for You

When you’ve been keeping detailed spending and earning records like this for a couple of months, you’ll have enough data to start analysing your figures. This is where you see just how powerful this simple system is.

Look for patterns in your spending. Because you wrote down what you were spending money on, you’ll have built up a record of the types of things you often buy. Examples might include groceries, car fuel, taxes, internet and utilities, entertainment, clothes, gifts, subscriptions, medical expenses. The list is practically endless.

By adding up all you spend on different categories, you’ll soon get a picture of where most of your money is going. And once you know, you can choose whether to carry on as before or make some changes, such as paying off bad debt faster, or save for the luxury items you’d like.

What sort of changes? Maybe your grocery bill is a bit shocking. Areas to consider changing here might include how often you shop, whether you make a meal plan and shop from a list, where you shop and whether you can find a cheaper supermarket, or what type of food you buy and whether you can pay less for similar but unbranded items.

By controlling spending in this way, you’re making informed, intelligent decisions. It’s a far more sustainable way of cutting down on spending than stopping buying things you enjoy, which is the way most people go about spending less.

This simple system forms the basics of even professional accounting, where businesses need to keep detailed records for legal reasons. It’s easy, but it’s very powerful, and once you get into it can even be fun. If you find you enjoy tracking and recording money, it could even open the doors to a new and lucrative career in accounting.

Keep Your Receipts to Make it Simpler

These days, lots of shops don’t even offer a receipt for small purchases, especially if it’s not something you’re likely to want to return. If you’re not offered a receipt, ask for one.

Having a paper record of what you bought means you don’t have to carry your notebook around with you all the time. And if you’re keeping digital records, it also means you won’t risk forgetting a purchase when you sit down at the computer. 

You can gather all the receipts together and bring your records up to date whenever you have a few minutes. Even small expenses soon mount up, but with a receipt, you can stay in control of them.

If you feel like money runs away from you, or trickles through your fingers without you even noticing, give this easy method a try. You’ll soon find you’re building a better relationship with money because finally, you’re the one in control.


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