A well planned economics is the first step to financial freedom. This is the secret of the one who reach their financial freedom. Unfortunately, only 5% of the people do this. The other 95% failed to do it. This is the reason that keeps people away from their financial freedom goals. Actually, it is not a hard thing to do but the one who did it the one who will become successful. Remember that. You keep on following what normal people do, you will become normal. Instead of following them why not you mimicking the successful people.
How to track our economics?
I got this idea after reading The Compound Effect written by Darren Hardy. As stated by Darren, when he acknowledge he was losing money but don’t even know where the leaking is, he started to ask his accountant for an explanation. Unfortunately, his accountant also did not know exactly where did he lose his money on his expenditure. However, his accountant propose a guide that can help solve this problem once and for all.
This technique is very easy and simple to do. I called it the tracking technique. Just like index funds tracking the markets. LOL
But how does it works?
This is where the easy part. first of all, you should have a notebook to track down your expenditure. Or in this century you can use your notes in your iPhone. Either one is fine as long that you write down what you spend. As for me, i would prefer a small notebook that i can carry everywhere i go. Since i love to write on paper, of course i would choose notebook right.
Then, after you got your notebook, you should write down everything that you spend on that day inside your notebook. So it is like a expenditure notebook. You should have the date, the days, what is the thing that you spend, how much is it column and the total expenditure for that day. Also, you need to write everyday consistently to track down you money leaking.
I promise you one month, doing this you would know where the hell did your money goes out the most. It can be your Starbucks coffee, your McDonald’s happy meal, your subscription magazine and so on. After that, you would try to cut down slowly and step by step your expenditure that had been money sucking you slowly. For example, you can stop the subscription magazine.
Additionally, if you did not like this kind of strategy to manage your economics, check out 27 Sneaky Ways To Save $100s A Month.
Why should we plan our economics?
The main reason is because economics is the easiest things to calculate in our life. And when i say economics, it means our money or financial management. All that we have to do is just playing the numbers with a “cowboy” maths is enough. You don’t need calculus knowledge to track and manage your economics. For example, adding and subtracting the number from our banking accounts.
That’s all. What an easy thing to do and Not to do. I mean how hard can it be to just write down what you spend after spending it. It only took a couple of seconds rather than you shopping for hours. Just write it down and total it up guys.
Then, you can start to add up your monthly expenses and subtracting it with your salary.For instance, if you happen to buy a cup of coffee at Starbucks, write it down and adds to your daily expenses. At the end of the months total it all up, your Starbucks, you subway tickets and so on. Not so hard ain’t it.
Here’s a video by the legendary success speaker Jim Rohn of how to use our money wisely.
How come the easiest thing to do is plan our economics?
- Easy, if i ask you how happy you are right now or how do you feel right now?
- What would your answer be?
- Yes, each and everyone of us would describe different thing depending on our lives.
- But tracking your economics is not. You don’t have think that hard to total any of it.
- That is why it is easy and because of that, people keeps slacking off.
The benefits of planned economics:
- You can save more money than you think.
- You can finish your loans faster than you think.
- Find the leaking in your spending that made you just over broke.
- Getting out of the rat race.
- Speeding up your way to financial freedom.
- Secure your investment buying power.
- Making sure you have emergency money somewhere in your savings.
- The tracking expenses will make you become clear of your economics.
“A lack of clarity could put brakes on any journey to success – Steve Maraboli“
- In short, track your expenditure, jot down everything that you buy on your notebook, total it up and reflect what you bought.
- Ask yourself regarding the expenditure “Is it really necessary or just a bad habits?“.
- If it is a bad habits cut it down slowly. Be sincere with yourself. Do you want to live just over broke and trap in the rat race for your entire life?
- If not, then it is time to change. I dont want it either. It is time to track down our expenses.
Finally, be consistent with the tracking your economics. It is your best chance to your financial freedom. I encourage you to do it. If it does work, you can always go back to the old ways. But, what if it works? You never know until you try. Join me with this quest. I already tracking my economics since November 2016 and I pretty much know how much i spend literally everything with my money.