This Simple 30-Minute Personal Finance Exercise Saved Me $342 This Month
For many of us, our main goal in business is to make more money, and we’re always focusing on what the next item is to buy. What’s the next business to start? How can I amplify what I’m already doing? How can I make more money in my business?
But don’t forget that there are two sides of the coin when it comes to growing your overall net worth and making more money. One side is making more money, but also another side is minimizing expenses, minimizing bills, and saving money where you can. One of the things that I did recently—and this is something you should do periodically, maybe once a month or at least once a quarter—is go through all of my statements.
This is just basic personal finance, but I feel it’s overlooked because a lot of people are just focused on making more money and never really take a look at reoccurring bills and if they have increased. For example, my bookkeeping service just increased in price, and I may or may not want to keep it.
Pay Attention to Bills
Do we have subscriptions to stupid things that we don’t even use anymore? Maybe it has to do with your business; maybe it’s something in your personal life. For example, maybe your phone bill went up or your cable bill went up, and you could renegotiate that. Maybe something got tacked onto one of your bills and you didn’t realize it. You got charged something on your credit card and didn’t realize it.
Once a month, once a quarter, or once a week—whatever that is for you—go through all of your bills.
Now, one of the things I’ve emphasized in the past is making sure that your business and personal finances are separated. So any time you buy something for your business, incur an expense, or gain something in income, it should be separated.
Your expenses should be on its own business credit card or at least a credit card that’s only for your business. Your income should be coming through only on your business account.
Go Through Everything
You should be going through every now and then and checking, minimizing, getting rid of, or eliminating bills that are affecting you every single month. If you’re getting hit by a bill or getting charged an increased amount, that’s taking away from your bottom line.
So just make sure to go through every now and then and check all your credit cards, business and personal. Check your bank accounts. Make sure you’re not getting charged something you didn’t know about. Check your PayPal. Make sure you’re not getting something additional or something that you completely forgot about.
You’ve got to make sure to go into your PayPal settings to take a look at your reoccurring subscription fees because these things add up.
I just practiced this exercise the other day, and one thing that I actually did was take a look at the bill for my email provider, ConvertKit. I realized that my bill had gone up substantially, which is because my email subscriber base had grown so much recently. It went up from $230 a month to $350.
And then what I did was go in, found all my cold subscribers (people who weren’t opening my emails), and sent them a campaign and deleted them. It took my bill from $350 down to $200, so I saved $150 off the bat.
Then I eliminated a bunch of apps that I wasn’t using on my iPhone Store. I minimized probably a good $400 a month because I decided to stop being lazy and actually go through and look and update things. I also negotiated a couple of things with my cable company and Internet.
One More Tip
Just make sure to go through and check this out from time to time. We’re always so focused on making more money, but we can hold on to more money and grow our net worth if we take care of both sides of the equation, not only focusing on making more money but reducing bills, minimizing bills, eliminating bills, and negotiating bills.
One more tip I would give you is to create a spreadsheet, whether that’s on Excel or that’s on Google, one of those cloud-based spreadsheets. That’s what I use. Write out all your expenses, write out all your income, making sure to break up everything between personal and business.
Go through line by line to see if you see anything new or anything that has increased. If you see any discrepancies in price, contact the company. It’ll make things a lot easier for you.
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