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Budget Killer

Budgeting a piece at a time.

Worby wealth Management a Trusted Regina Financial Consultant talks about a Budget Killer.

There is an insidious monster in your personal finances trying to eat up all your money! It is so small, you may never even notice until you realize you are living paycheque to paycheque or worse, going negative every month.

It’s called the MONTHLY PAYMENT!!!!

And it goes like this, “Cable bill, $60. Internet bill, $35. Cell phone, $60. Cell phone #2, $60….” Many people I know end up spending around $300/mo on telecom if you include internet, cable, land line, cell phone, data plan all in that category. And none of those amounts look so high – $60/mo, I can pay that. But when you add them all up, you have a real dent in your monthly finances.

So if you think bigger than this, how many amounts do you pay in the $11/mo range – think banking fees? How much do you spend at $10/mo, $20/mo and so on? And none of them are all that expensive really – they are just there.

We buy cars this way, houses, gym memberships, all kinds of things. The problem is that this leads to what I call “Accidental Spending” and can really destroy your budget. Paying in full and up front or thinking about your finances as a whole year’s expense can really change your patterns.

Think about it, if you had to pay $600 once for the gym rather than $50/mo, would you think twice and really consider getting that membership? And if you did think more before the purchase, would you be more likely to use the membership?

Same with your cell phone, if you thought about your data plan as a $40/phone/month expense for 2 phones, would you think twice about $960/yr just to get facebook wherever you want? Maybe you could wait until you are on a wireless network after all!

So, think about payments because they happen whether you go to the gym or not and whether or not you go out for dinner as well.

 

Chris Worby is a Trusted Regina based financial advisor and Wealth Management consultant servicing local Regina households and businesses since 2001.

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