Financially Fit After 40 welcomes life coach, Melinda Engle, MBA as a guest contributor.  Check out her simple but effective exercise for getting your spending under control.  

 Unfortunately, there is no such thing as a money tree where we can fill our savings and retirement accounts, but you do have options for stretching what you already have.

First, create a budget of where you think your money is going each month.  Then, for 30 days, keep track by recording all of your expenses.  Did you spend money only where you were prepared to spend it?

Now, create a budget with where you want your money to go each month.  Include a meal plan to ensure you have enough to eat and meals ready when you need them.  As you go through the second month, your budget by your side, make sure you don’t spend anything that isn’t already budgeted.  Of course, this means you may need to include a miscellaneous category for unexpected, but necessary expenses. 

Each time you pass up an opportunity to make an impulse buy, record it next to your budget.  You will be surprised how much you save yourself at the end of the month, how much further your money went, and you will be empowered by having your money go to the things you really want it to go to!

            Once you’ve mastered your current spending, this exercise can be an excellent tool for reducing debt as well.  Extra money that wasn’t spent on impulse buys or meals out due to poor planning can now be used to pay down those high interest rate cards.  If you are debt free already (congratulations!), use this to increase your emergency savings.  Ideally, you should have roughly 4-6 months worth of necessary household expenses saved in easily accessible accounts, depending on your situation.

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