- I Wasn't Paying Attention: Where Does My Money Go and
How Can I Get Some Back? - Part 2
by: Janet L. Hall

Hopefully, after keeping a daily or monthly log of
expenditures, youve begun to notice your pattern of
spending habits. You should be able to see where all your
money is going and not just wondering. You should now be
able to look at what you can cut out or cut back on.

Why do you need to do this * OverHall *?

Several good reasons could be if youre having troubles
making ends meet, living from paycheck to paycheck, or
dont have any money in reserve for unexpected
emergencies. Other reasons could be that you want to buy
a home, take a vacation, buy new equipment for your
business, go to college or send your children to college. Still
other reasons could be that you're self-employed and you
need to save or invest for your retirement.

Lets get started by making two lists, one for your NEEDS
and one for your WANTS.

Whats the difference?

Let me give you an example of how I see NEEDS vs.
WANTS.

A NEED is something that you NEED to survive such as
food, shelter, and clothing.

A WANT is something you desire. Something that you might
already own, but you WANT another or a new one such as
shoes, or a jacket, or a car. A WANT can also be something
that you dont currently have. As humans, we all have
unlimited wants, therefore we must make choices. In
economics this is referred to as * opportunity cost *, the
highest-valued, next-best alternative that must be sacrificed
to attain something or to satisfy a want. Some refer to this
as a trade off.

Now you need to ask yourself how much you are willing to
spend or need to spend on your needs to survive and are
you spending too much? Do your clothes have to be new,
with big name labels? Does your home have to be near the
water with a hot tub and a swimming pool? Does your food
have to be the best cut of meat or dining at fancy restaurants
every night? You get the idea?

What about your WANTS? What are you willing to trade off
to make your WANTS a reality?

Lets look for a minute of a WANT of a vacation to Alaska.

You will need to take some actions and ask yourself,
possibly, some hard questions, and make some hard
decisions.

~~ Do you have to save for this and how will you save?

~~ What steps must you take to estimate the cost of such a
vacation AND what steps will or can you take to save for the
trip?

~~ How long do you want to vacation?

~~ How will you travel and what are those costs?
Planes, Trains, Automobiles?
Hike, Bike, Cruise ship?

~~ Where will you stay and what are those costs?
Hotel, Motel, Inn?
B&B, Igloo, Tent?
Friend, Relative, Friend of a Friend?

~~ How will you eat and what are those costs?
Bring or buy food there?
Eat out?
Skip some meals?

~~ Do you need to purchase * special * clothes?
Where can you purchase?
How much will that cost?

~~ When do you want to vacation in Alaska? Now, next
year, five years, or ten years?

Once you find the estimated answers to those questions
youll need to look at how much you need to save and where
in your daily expenses can you cut back.

TIP: Use this type of exercise for any wants you have for
your life and business. Youll discover if you can really turn
your wants into reality, if they are realistic and feasible.

Top 10 Tips for * OverHalling * Your Purchases
1. Plan, plan, plan ahead
2. Dont pay retail
3. Shop at thrift stores, consignment shops, secondhand
boutiques, warehouses, or in the slightly damaged
department.
4. Get in a co-op or collectively buy with others
5. Dont shop with your emotions, use your conscience
when shopping
6. Rent big ticket items when possible (for instance, if you
need to fold 10,000 documents on a quarterly basis or
use a saw-zall once a year)
7. Use the library
8. Barter
9. Comparison-shop for EVEYTHING!
10. Dont buy because its on sale or because you have a
coupon

Lets look at some items or habits you can stop this month in
order to start saving (Use your items and figures that you
had logged into you daily expenditures).

$208/yr newspaper
$72/yr 1 movie a month at $6
$720/yr 20 breakfast drinks a month at $4
$48/yr 1 magazine at $4 a month

GRAND TOTAL of SAVINGS a YEAR=$1,048

In ten years that would be $10,4800

Now, think a minute, what can you do with that $1,048 extra
a year or that $10,4800 in ten years?

Get a big jar; water bottle, tin can, piggy bank, or something
to start throwing your MONEY into (dont forget a container
for your car).

If you pay cash for a daily newspaper, throw your paper cost
DAILY into your container. If you pay monthly, write yourself
a check for that cost. Start a new habit by being selective on
what you NEED to read and see if you can read it on the
Internet or at the library. Can you hear about it on the tv
news? Better yet, try a life change and STOP readin gor
listening to the news and start making your own * news * to
share with relatives and friends.

When you go to rent a movie, STOP, and throw that money
into your container. See if the movie is at the library, if a
friend has it to borrow, or wait for it to come out on regular tv.

Start making your * special drink * at home in the morning.
You are now able to ENJOY your * special drink * because
now you have more time because; you dont have to drive to
the * special drink * place, get out of your car, stand in a
sometimes long line, wait for your order to be prepared, and
guzzle down your *special drink * while sprinting off, racing
off, or dashing down the street to wherever you might be
headed; NOW you can relax and throw your $4, your stress,
problems, and concerns into your container and REALLY
ENJOY your * special drink *. (whew, didnt mean to get off
on a rant ).

That magazine that comes monthly, that you never have
time to read, and is piling up on the table or floor; stop it from
coming into your home or office and write yourself a check at
renewal time! If you think you cant live without it, see if a
friend gets it and ask to borrow. See if its on the Internet or
at the library

Im not trying to tell you to be a penny pincher or a miser. I
just want you to REALLY look at where your money is going.
Stop, think, and look at how you can * OverHall * your daily
expenditures so you can get some of your hard earned
money back and bring a sense of financial BALANCE back
into your life.

If you find you are spending money on something that
TRULY brings happiness, pleasure, comfort, and BALANCE
into your life, then dont give it up. Although you might
consider cutting back on that item.

The Organizing Wizard, Janet L. Hall, is a Professional
Organizer, Speaker, and Author. She is the owner of
OverHall Consulting, and Organizing By Phone. Subscribe to
her FREE organizing newsletter at
http://www.overhall.com/newsletter.htm or visit
her web site at http://www.overhall.com

Copyright ( c ) 1999, 2000, 2001 by OverHall Consulting
P.O. Box 263, Port Republic, MD 20676
All Rights Reserved. Permission is granted to reproduce,
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