Changing your lifestyle

Cutting out the things that are not important to you.

Image source: Getty Images

When I started working full time, I had no idea how much money I can spent on food and drinks every day. As my work places was right at the business district, there are a lot places that ensure I can spend my salary at. On a typical work day, I'd spend $8+ for breakfast, $10+ on lunch and $5 to $8 on afternoon coffee and that is excluding dinner out with friends! It adds up, especially when your income is just enough to cover rent, bills and other expenses.

However, I never really think much about it as my salary increases and I can live out my usual day of having my twice daily latte , after work dinner and a minimal of twice a year traveling for holidays. While in fact, I am actually living from pay-to-pay. I always thought that was normal and that everyone did it, but now I realize that it's not.

Then I came across The Latte Factor: Why You Don't Have to Be Rich to Live Rich by David Bach and John David Mann. It changed my life because it showed me how to save money in little ways like cutting back on coffee or buying the cheaper brand at the supermarket instead of the more expensive one. The best part is that these changes weren't hard - they just required some self-awareness and discipline.

Cutting out the things that are not important to you.

Think about how those routines impact your finances. I did a calculation on things I can cut out. For example, my daily expenses:

1. coffee x2 = $10

2. gym membership for the month= $135 est

3. morning or evening cab rides = $20 est

4. lunch = $10 minimal

5. dinner = $30 minimal

6. shopping for clothes / accessories for the month= $200 est Total for the month: $405
   

$405 doesn't seem a a lot if you are earning like an average of 3k per month. Let's make it a year. That would be $4,860!!! Think about it, for each habit, think about the cost, and what you could do instead. Remember these are things that make you happy. It doesn't cover the really important stuffs like student debts or any other sort of credit debts, money for your dependents, savings, investments or any sort of insurance protection.

One day, you might want to work for yourself or you want to go back to school or even to do a sabbatical and you will need to have cash. You start to realized how much you could have save if you had cut back on that coffee or cab rides.

Make a list of all the things you spend money on in a month. Identify the habits that cost the most money. If I only had ;

1. coffee = bring my own coffee

2. gym membership = go swimming in the public pools or use the park

3. morning or evening cab rides = research on public transport alternatives

4. lunch = cut down to $5 or bring my own pack food

5. dinner = go out less often, cook more at home and invite friends over

6. shopping for clothes / accessories = go for second hand clothes or go for minimalist wardrobe.

That probably would have cut my expenses in half or more. Takeaway: You can live well by reevaluating your lifestyle habits.The most important thing is to have self-discipline, once you make it a habit it will be easy for you to save money for the future

Money you need to keep aside

You work hard, and you deserve to spend your money on things that make you happy. But… what if something unexpected happens? What if you're not prepared for a rainy day?

The truth is, we never know when things will go wrong—and it's even more important to be prepared for the unexpected when you're living paycheck-to-paycheck. That's why I recommend setting aside some of your income each month.

You'll need to figure out exactly how much to save—but here are some guidelines:

1) Insurance coverage: You should have at least enough money set aside to cover your health insurance deductible in case of an emergency. Insurance is basically just paying a little bit now so that you don't end up paying a lot later if something bad happens. And while it may seem like an unnecessary expense now, when the time comes for you to actually need it—you'll be glad that you have it.

2) Emergency savings: This is the amount you'll need to cover any other emergencies that might come up, like losing your job or having car trouble. It should be enough so that you can get through at least three months of expenses without having to borrow from friends or family members (or worse).

3) Investments: If you want to build wealth over time, investing some of your money in stocks or bonds could be a good idea—but only after taking care of all other financial obligations first!

If you're like most people, you have a lot of money going out every month and not much coming in.

It's time to reevaluate your lifestyle and protect yourself from unnecessary expenses. Let's talk about what it means to have financial wellness and how I can help you get there! Feel free to call me and there is no obligation you have to buy any products from me as I believe its better to be informed and know how to manage your financial for the long run.

Remember, you can live well by reevaluating your lifestyle habits.

Image source: Getty Images