How to spend money correctly: 20 tips for those who want to learn how to spend money rationally

Not everyone can boast of financial literacy and the ability to spend their earned money correctly. Most of us regularly make unnecessary purchases, face holes in the family budget, and use loans due to the lack of our own savings. Therefore, the question of how to spend money correctly is relevant for almost everyone. After reading our material, you will learn how to spend your family funds wisely, planning and clearly distributing the budget according to individual items.

How to learn to spend money correctly: 5 secrets of shopping without worries

Spontaneous purchases are not only a consequence of our financial illiteracy. Huge corporations are spending billions of dollars to sell us more and more. Entire armies of psychologists, marketers, and designers are working to push consumers to make a spontaneous purchase. We are convinced that there will be no better deals, that we need to buy it right now (the price will go up tomorrow or it will run out), that with this product we will become happier/healthier/more desirable, etc.

Here are just a few popular misconceptions that subsequently lead to unjustified financial losses and prevent us from spending money correctly:

• "Sale! What wonderful trousers! Well, let them be a little small. By summer I’ll lose weight and wear it.”
• “Wow, what a promotion! Take 2 pairs of shoes and get the 3rd as a gift! Wow, how lucky I was! And it doesn’t matter at all that I only planned to buy slippers.”
• “Darling, we’ll buy coats in this store, because we need to accumulate 100,000 rubles worth of purchases there, and then I’ll have a 7% discount. No, we won’t look at the next store, I have quite a bit left to pick up here.”

Solve problems immediately

Don't put off solving problems until tomorrow.
Even if they are not serious and do not promise big troubles in the near future. Over time, all small problems turn into major ones if you do not pay attention to them in time. Naturally, solving them will require much more time, effort and money than at the very beginning. If you cannot figure out the problems yourself, contact our website lawyers for free help:

How to spend money correctly so that you have enough for everything and even more

To keep your expenses under control and spend your money wisely, you can use several simple tools:

1. Dividing expenses by week.
   From your monthly income, set aside money for mandatory fixed expenses (food, utilities, travel, etc.). Divide the remaining amount into 5 parts. During each of the four weeks of the month, you can spend no more than one portion. Use a fifth for the remaining days of the month and saving.
2. Analysis of expenses by budget items.
   An Excel table will help you spend money correctly, where all expenses are broken down by item. Such a table will subsequently be easy to process and analyze. Enter the types of expenses in the columns: utilities, groceries, clothing, entertainment, etc. Enter the dates in the rows. If necessary, you can always filter the table by the desired month. It makes sense to enter expenses for eating out or travel separately for each family member, since one of you may spend money correctly, while the other may not. You can insert a simple formula at the top of the table to see what percentage this or that type of expense takes from your total income. At the end of the month, analyze which expense items are the most expensive and think about how you can reduce them. This method is good because you will have a clear understanding of where all the money is flowing. After such an analysis, such questions will no longer arise, and an understanding will be formed of how to spend money correctly.

To start creating a financial plan, you need to understand where all your savings are going:

• Record how much each family member contributes to the family budget.
• Calculate how much money each of you spends on your hobbies and entertainment (going to clubs and cafes, sports, hunting and fishing, knitting, drawing, etc.).
• Calculate how much you spend per month on groceries.
• To spend money correctly, only one family member should visit the store.
• Don't get carried away with semi-finished products. It is much more profitable and healthier to cook homemade food.
• Calculate how much your family spends on car maintenance, health insurance, and Internet communications. Look for better options.

Correct and incorrect spending

Before giving advice on how to spend money wisely, you need to determine for yourself what right and wrong spending is. I made my list. It may turn out completely different for you. The point is to make the reader think about everyday things and see that some expenses can seriously poison life.

After reading, you will understand how to stop working for pennies at a job you don’t like and start LIVING truly freely and with pleasure!

Proper spending

Here I included those expense items that, in my opinion, are necessary for life to be full and comfortable.

• Health

This includes expenses for visiting a doctor, gym, and swimming pool. I prefer paid clinics, because in public clinics you either have to wait months for a free place with a specialist, or there is none available at all. But sometimes there are exceptions to the rules. For example, the eldest daughter goes to get her teeth treated only at free dentistry, but to one doctor. The quality of treatment and attitude are at the highest level.

• Education

This is a mandatory expense item in our family budget. This includes expenses for additional education for the youngest daughter (the eldest already earns money for it on her own) and advanced training for my husband and I (courses, webinars, conferences).

• Nutrition

The biggest expense item in our family. We try to eat healthy: no fast food, processed foods or junk food. In the store I always read the ingredients and look at the expiration date. But there are options for significant savings here too.

I wrote a whole article about how to save money on groceries. The publication caused heated discussions in the comments.

• Household needs

These are expenses for the purchase of household goods: washing powder, detergents, bath accessories, hygiene products, etc. I have a private home, so regular expenses often increase due to the purchase of various goods for the home, garden, and vegetable garden.

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• Public utilities

Fortunately, we can control utility costs in our home. We do not have expenses for the maintenance of common areas, as in most city apartments. Instead of centralized water, we use our own well, which has already paid for itself several times.

• Taxes

These are mandatory payments. But I recommend that you carefully study the tax code in order to take advantage of the tax benefits entitled to you. My family pays back their income taxes every year. This year the refund amount was about 100 thousand rubles.

• Transport and communications

This section includes expenses for gasoline, car maintenance, and travel on public transport. You can save money with discount cards that your husband uses, refueling at a self-service gas station, and a travel card for your child. We also love to walk.

• Rest

An extensive expense item, which in my family includes mandatory vacation 2 times a year and small entertainment throughout the year (going to the cinema, theater, cafe, etc.). It so happened that we have no hobbies. But for other people, the costs for it will also be included in this section.

• Clothes, shoes

We buy only after planning the next month in the family budget. We try to buy large and expensive items out of season. For example, we buy winter clothes and shoes in spring or summer. We don’t chase brands, but we do monitor quality.

Wrong spending

In any of the articles listed above you can find something that is not worth spending money on. For example, buying shoes for your husband because the old ones fell apart is the right expense, but buying a dress that is not needed at all, but there was a discount on it in the store, is the wrong expense.

I have identified the following categories of expenses that you can definitely do without.

• Spontaneous (emotional) purchases

I am a very rational person, but I also make spontaneous purchases based on emotions. I understand the power of marketing and the tricks of marketers, but sometimes I fall for them. Discounts and promotions scream savings. But savings can completely disappear if it turns out to be spending on unnecessary things. There is only one piece of advice here: every time ask yourself the question of whether this product is needed or not right now.

• Bad habits

It's not just about smoking and drinking too much alcohol. The list can be very large, for example: shopaholism, gambling addiction, overeating, technomania, etc. I recommend identifying bad habits and eliminating or at least minimizing their impact on your expenses.

A simple trick helps a lot: count how much money you spend a year on indulging bad habits. If you are impressed, then activate a plan to get rid of them. If not, then keep up the good work.

• Harmful products

I won’t be original here, but will listen to the advice of experts. I consider energy drinks, chips, carbonated drinks and anything that contains a lot of salt, sugar, artificial additives and other things to be harmful. Food costs can rise if you give up cheap but unhealthy foods. But treatment costs will be reduced.

• Credits and loans

This is a topic for a separate article. I apologize in advance for the above quote, but it very accurately shows the essence of credit: “Credit is like shitting your pants in winter. At first it’s warm and good, and then it’s cold and disgusting.”

At the same time, I divide loans into “bad” (consumer loans, loans from microfinance organizations) and “good” (mortgage, if you need housing, car loan, if the family needs a car, education loan).

• Expensive gifts

For some reason, I immediately remember the horse statue from the movie “Office Romance”. Don't give such gifts. I prefer to find out in advance what exactly a person needs. If this doesn’t work out, then the best gift is money or a certificate to a store that sells something everyone needs.

• Buying unnecessary equipment

In the bad habits above, I wrote one called “technomania.” This is the purchase of the latest new household appliances and electronic gadgets. As luck would have it, they appear too often. People are taking out loans to become the owner of the latest iPhone.

• Children's whims

Probably, at least once in our lives, each of us became either a participant in another child tragedy in a store, or an observer. A child who has at least once received something after a tantrum that his parents did not intend to buy will resort to the proven method again and again. With age, the costs of such cravings will increase.

• Stress Spending

I often hear from people that they like to relieve stress by going to the store or drinking alcohol. If this does not happen too often and such treatment is not too expensive, then I have nothing against it. What if stress happens every day?

• Unnecessary subscriptions, banking services

Review your subscriptions with your mobile operator. Check what you signed up for when applying for a bank card. Or maybe it’s time to change the tariff altogether?

07.05.2018

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How to save money correctly even with a modest family income

Hello, friends! We still have the opinion that...

How to spend money correctly and plan a monthly budget

To plan your family budget, break down all upcoming expenses by item:

• Mandatory expenses are expenses for basic products, household chemicals and hygiene products, medicines, utility bills, payment for kindergarten, mortgage payments or rent, etc.
• Minor expenses - additional training, fitness and sports clubs, hairdresser services, basic clothing, vacation, savings for a rainy day.
• Optional expenses - trips to cafes, restaurants and clubs, salon services, purchase of toys and new gadgets; products that you can easily do without (desserts, alcohol, gourmet cheeses, etc.).

In order not to make unplanned expenses, it would be correct not to take extra money with you: you should only have with you the amount needed for today. The relevant question here is, how much money can you spend per day and, accordingly, have with you? There is no universal answer to this. This amount is individual for each family. You will need to calculate your daily budget for current expenses yourself.

If you are a shopaholic, do not take a credit card with you to the store and strictly follow the shopping list that you have prepared in advance.

Where else can you reduce your expenses to spend money wisely:

• on payment of utilities when installing water and gas meters;
• when buying home appliances, buying models that are simpler in functionality;
• on clothes, purchasing them out of season or on sale;
• on products, if you reduce the amount of meat and sweets in the diet, purchase products in wholesale stores or on promotions;
• You should not skimp on fresh vegetables and fruits, as they are a source of vitamins and minerals that are beneficial to the body.

Next, let's look at each of the above points.

Educate yourself

One day a famous businessman and entrepreneur was asked: “What is the best way to spend money?”
The answer surprised many. He said the best thing to do is invest in yourself. That is, educate yourself. Frequently attend various trainings, courses and seminars that are relevant to your work or hobbies. Read more literature. This is the most profitable investment you can make.

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How to spend money correctly (on groceries, utilities, etc.), without forgetting to save

Considering all types of expenses separately, you can see an obvious picture: some cannot be avoided, others can be reduced, and others can be eliminated altogether. There is always an opportunity to reduce costs. At the same time, you can easily save an amount in a year that is enough for a summer vacation abroad.

1. Saving on food.

Food is not only energy and building material for our body, but also a source of happiness hormones. Apparently, this is why we buy food in much larger quantities than our body requires. To spend money on groceries wisely, follow these guidelines:

• Visit grocery stores only with a shopping list and do not deviate from it.
• Stick to your monthly/weekly grocery budget target.
• Create a monthly menu of simple and inexpensive dishes.
• Eat only at home. Try not to spend money on canteens, cafes and restaurants.
• Use an app with discounts on products.
• Don't snack on the go. This is correct from an economical point of view and is good for health.

Attitude to money

The value of money is quite conditional and depends on the standards of each person. To determine the degree of value of monetary resources, it is necessary to make certain calculations:

• calculate the cost of one hour of work;
• learn to quickly calculate the number of things that can be purchased in one month;
• calculate the cost of one use of a thing.

On a note! It will be useful for everyone to learn how to calculate each working hour. When the cost of one hour becomes known, it will be possible to look at things differently.

If a dress costs five hours of labor, maybe it doesn't need to be purchased for that amount if buying it won't fundamentally change anything.

The number of possible purchases is also easy to calculate. An iPhone that costs as much as your salary won't be a good idea. This may lead to the need to borrow money.

If a thing will have to be repaired sooner or later, you need to think about whether there is enough money to repair it. The best option is to buy a gadget that fits more than three times into your monthly budget and will last a very long time.

Changing your attitude towards finances will help you learn to save and save money.

How to spend money correctly if your salary is small

A small salary is a good reason to more closely control your expenses. Try following the recommendations below:

• Give up loans. Cut back on non-essential expenses. Prepare simple and healthy food according to the menu prepared in advance for the week.
• Analyze your expenses for the month and move into a separate column what you could do without. This may include fast food (chips, soda water, hamburgers, etc.), spontaneous purchases from the category of optional (cosmetics and items from sales, etc.). Review the mobile and Internet tariffs you use. Look for better options. Think about what services you can forego by doing them yourself (for example, a car wash).

• The next step is to create a “saved” column in your spreadsheet. To do this, instead of buying something that you can refuse, set aside this money and record it in a table. After one or two months, you will be pleased to note that you have saved a tidy sum, and you will be able to spend it on something necessary for your family.

Small income is not a reason to deprive yourself of everything. And with a small salary, you can save money (if you spend it correctly) on things that are necessary and important for your family: a car, a country house, a seaside vacation.

It is important to know the exact cost of your dream and the period of time during which you need to save money for the purchase. After which, every month you need to purposefully save the planned amount, using the savings method and other sources of income. For example, a bank deposit with interest or investing in securities and receiving dividends.

Travel

What could be more enjoyable than traveling?
By visiting new places, cities and countries, you get new impressions and unforgettable emotions, as well as memories that will stay with you for a lifetime. Pay attention to package tours (sets of ready-made services, which usually include: flights, accommodation, meals, transfer to the hotel and back).

TOP 5 services of 2021 for the selection of package tours:

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3. Big Country >>> is a community of 97 local tour operators in Russia with a unified booking service. Tours for every taste in 50 regions of the Russian Federation. All tours on the site have direct prices from the organizers included in the community.
4. Sletat.Ru >>> - search, compare, book and purchase tours from all major tour operators in Russia. You can choose a trip to the sea, a ski resort, an excursion tour, book online and pay by credit card.
5. Lavel.Travel >>> is an online service for booking tours, an automated system for searching for tours from all reliable tour operators and purchasing them online, without the participation of a travel agent.

Savings on housing and communal services

There is no escape from rising prices for electricity and water, but there is a real way to pay exactly as much as you consume - install meters for gas, water and electricity, there is also something to save on.

By purchasing special equipment of the AA+ standard (low energy consumption), you will not only save your money, but also quickly pay for the equipment itself. Motion sensors for the lights will also come in handy if you forget to turn off the lights when you leave the room. Don’t ignore leaking taps or toilet cistern, which can waste up to 100 liters per month.

Pay the required payments

As soon as you receive money, you should immediately set aside to pay your obligations. Almost every adult has them, I will comment on them separately below.

Mandatory payments are those that you cannot avoid. For example, you cannot not pay for utilities, otherwise you will be evicted from your home. You cannot fail to pay your loan, otherwise the bank will send debt collectors to you.

Loans

If you have any debts, you should know exactly how much you need to pay off each month. And immediately set aside this amount to avoid problems and difficulties.

If you think that after paying off the loan you will have nothing to live on, contact the bank and tell the bankers about it. For long-term loans, such as a mortgage, the bank can usually reduce the interest rate and extend the term. Or to meet you halfway in some other way.

The bank wants you to pay. Even if in smaller volumes and for longer, they paid.

Communal payments

The advantage of utility bills is that their volume is almost always known in advance. When you have lived in an apartment or house for a year, you will know how much you have to pay on average in the summer and how much in the winter, when the heating is on.

Set aside the required amount for utility bills so that you can “forget” about it and not worry.

Major renovation

Its amount does not change at all. You can not only allocate this amount from your salary in advance, but also set up automatic payment on your bank card. Then the money will be transferred for major repairs automatically and without your participation.

Payment for Internet and mobile communications

I pay for Internet and mobile communications 750 rubles per month. I have a fixed tariff, under which I get 500 minutes for calls and 500 free SMS, this is quite enough for me.

If you have a similar fixed amount, immediately allocate it from your salary to pay. Or set up automatic payment, as in the case of major repairs.

If Internet and communication costs are not fixed, go to your personal account on your operator’s website and see how much traffic you usually spend and how long you talk to people. And set aside the required amount.

That's it, we're done with the mandatory payments. These were their main categories; if you have any other obligatory payments, also “provide” them with money at the first “receipt”.

Getting rid of conspicuous consumption

What do you think about when you look at a billboard with a message like “Credit for a smartphone”? Financial literacy experts “shudder with horror” or “boil with rage” – there are also more emotional assessments. Some even propose banning such services, or at least their advertising, as promoting living beyond one’s means and irresponsible financial behavior .

The latter, of course, is too much: it is possible to reach an agreement to limit the civil rights of shopaholics and sweet tooths, not to mention citizens who abuse alcohol or are interested in the opposite sex.

But there is a problem, sociologists have been sounding the alarm for a long time: Russians are too prone to conspicuous consumption, to luxury - we are not talking about fur coats, diamonds, sports cars and yachts. We are talking about consumption that does not correspond to income and is not designed to satisfy reasonable needs. It's about consumption, the sole purpose of which is to show: “Look, I'm cool!” And a smartphone that costs a salary, or even two or three, is far from the only example of this kind.

The problem is divided into several:

• Unreasonably expensive purchases divert resources from truly pressing needs. “Well, I’ll live on pasta for a month and do without fruit”...
• The illusion of one’s own well-being is created , thereby reducing motivation for professional and career growth
• Expensive things often mean expensive service .
  A friend of mine has not been able to repair the Swiss watch that was once given to him for many years now - the repair will cost 15 thousand rubles, and there is always a better use for this money. However, it might be worth doing - once upon a time they greatly simplified complex negotiations by accurately indicating his status and income level. For approximately the same reason, he stubbornly refuses a more expensive car, although he could afford it. By the way, if the watch or car were more expensive and did not correspond to income and social status, negotiations would be more difficult or simply unsuccessful. Too expensive things often cause confusion or suspicion among partners and employers.

Conspicuous or status consumption often contributes to excessive debt. And, accordingly, the subsequent “irritation” in personal finances.

It comes to jokes. At the height of the credit boom, in 2012-2014, the “wedding loan” began to gain popularity in many regions, with terms and amounts reminiscent of a mortgage - except that the rate was higher. The lavish weddings apparently made an impression on friends and relatives, but long-separated couples also pay for it, for them this is another reason to hate each other.

Invest funds

Investing finances in order to further increase your capital is one of the most rational options where you can spend money with real benefit.
Look around you - you will see a lot of opportunities on how to make financial capital work for you and bring in even more money. Free investment training:

The free course “Investing Basics for Beginners” is available in the Tinkoff Investments app >>>.

Author: Alexey Piven

Do it yourself

Instead of paying a specialist to repair your apartment, break down appliances or plumbing, solve the problem yourself. A service is convenient and profitable when it helps you with something you can’t handle. In other cases, you are essentially trading your free time for money you have saved. In the future, it will be nice to say “thank you” to yourself for this.

Useful techniques

There are several techniques that can help you spend your money more wisely. I personally don’t really trust them; I prefer regular self-monitoring and monthly budget analysis. But let's take a general look at what each technique offers. Maybe you will find it useful.

Envelopes

Spread your salary among several envelopes. Each envelope is for a separate expenditure. For example, you might have envelopes like this:

1. Communal payments.
2. Food.
3. Internet.
4. Credit.
5. Major renovation.
6. Directions

And so on.

When you receive your salary, you roughly calculate how much money you need for each expense item and place this amount in an envelope. And don’t take it out of there under any circumstances.

About the disadvantages

This option doesn’t suit me, if only because I have all the money on my card. I only pay for travel in cash.

Although, for example, envelopes may be suitable for my parents, because they hardly use cards.

50/30/20

This “technique” boils down to the following. You divide the capital into three unequal parts. In the first part - 50% of all money, in the second - 30, in the third - 20. The first part is spent on payments for obligations, the second - on necessary expenses, the third - on whims.

The money ratio should not change. If some component is not spent completely, this is only a plus; the money will “accumulate”.

It is possible to “reset” counters and “withdraw” unplanned accumulated amounts only at the end of the year.

Budget for 1 day

The principle of the technique is the following - you pay your obligations, and divide the remaining money by 31. You get a fixed amount of maximum expenses per day. For example, 500 rubles a day. You cannot spend more than 500 rubles a day. But if today you spent only 200 of them, then tomorrow you can already spend 800.

This technique is often used by people who find it very difficult to control their spending. If you are one of them, take note.

Find out the real cost

When you want to make a purchase, check its “true cost” for yourself. Calculate how long it takes to earn the money needed for this purchase.

For example, if you earn 300 rubles per hour, and you need 1,500 rubles for a purchase, you spend five hours of your work on it. Converting your cash price to an hourly rate this way helps protect against spending that you might regret in the future.

Read: What skills to improve to become financially successful

House

The house should be cozy, so that you want to return to it every evening. A house is like a living being. He is also sick and getting old, and we must maintain him in decent condition. Because home is our projection. It’s bad for him – it’s uncomfortable for us too.

Take a master's look at your home - what needs replacing? Maybe the windows need to be replaced? To prevent heat from escaping through the cracks in winter. Or maybe it would be advisable to install new entrance doors. After all, this is the calling card of your home.

Sometimes it is enough to hang new curtains or abandon them altogether, replace the chandelier or buy a new table lamp to make the house sparkle with new colors. But if serious repairs are needed, don't delay. Believe me, old plumbing, poor electrical wiring, dirty walls have a bad effect on the life of the owners and do not contribute to their well-being and success. Meanwhile, a clean, fresh home gives strength and feeds with positive energy.

Set a savings goal

Regardless of what you're saving money for, set it as a clear and measurable goal. For example, buying an apartment, a car or going on vacation. Having a firm idea of ​​where the money is being saved allows each person to work on the task more focused and efficiently.

Once you determine your goal, create a plan (personal map) that will help you get to the finish line. This “route” determines how much money you should save each month, taking into account your income and basic expenses. Planning will protect you from overspending.

First balance - then expenses

Simply put, pay your basic bills before you go to the party. Without knowing the personal or family financial situation, a person is unable to spend money responsibly.

It may seem that people always have a rough idea of ​​what their financial situation is. But that's not true. A person recognizes this when there is a clear picture and a personal or family budget. Thus, expenses subconsciously become deliberate.

To stop wasting money, don’t forget about bills and obligations.