Step 2: Plan Your Money

Have you decided what you want to eliminate from your expenses? Remember, you want to reduce (better yet, eliminate) spending on things that don’t meet your needs or provide improvement (or enjoyment) to your life.

This process takes time. Think of moving to a less expensive place: You still have to put in time and money up front to move, so you have to make sure that you factor in the upfront cost.

So, are you ready for the next step?

You know when you get paid, so make sure you know the dates you have to pay bills. Write down the due date for each bill you pay and compare that to the date of your paycheck. Make sure that you have enough to cover your bills before they’re due.

Try to negotiate your due dates so that you pay most of your bills on the same date after you receive your pay.
-Example: You have a $200 bill due at the end of the month and you’re paid bi-weekly: $100 dollars is set aside until that bill comes due.

Reducing your expenses and increasing your income is the only way to breathe. Also, I divide up my total monthly expenses by the number of paychecks (I’m paid weekly) so that I don’t have to hand over my entire check to pay one bill and have to scramble to cover basics like groceries.
Example. Total expenses are 2000 per month, paid bi-weekly, $1000 per paycheck is set aside for expenses.

This also has to be coordinated for the due dates, so I found that starting the pay check after the last bill was paid helps ensure that you have the full amount to cover the bill next month.

This concept will be broken down further in the book, but feel free to ask any questions if you need more clarification.

Steps 3 and 4 will cover what you should do daily and weekly to make sure you stay on track. Also, if you’d like to preview the book introduction, you can do so here. I would appreciate your feedback.

Until next time….

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