Scrooge Strategy

Another way to budget

3 comments — written on April 2nd, 2005

I’ve written about the importance of creating a budget before. But I just got an email with another idea:

Regarding savings and expenses – there’s an easier way to manage. Most people have trouble keeping track of expenses. The easier way? Just decide how much you want to save each month and automatically transfer that into savings then spend the rest. No need for complex expense management.

Phil

It’s still a good idea to know exactly how your spending is breaking down, but this is a great first step to saving money. I really like his idea of saving first, then spending what’s left.

3 comments

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  1. 1
    December 9, 2007

    David Saunders II

    The best ideas are always simple ones and this is no exception. I use a credit card (that I pay off every month) to categorize expenses since A.) My CC company lets me download directly to Quickbooks and B.) Everywhere including fast food restaurants now accept plastic.

    Phil’s idea is perfect – reduces financial stress and allows for ease of saving/investing right up front. As long as you’re disciplined against over-spending what’s left each month, you’ll be good. Save/Invest first (and pay taxes if not a W2 employee), and whatever’s left in your checking account is yours to use for the whole pay period.

  2. 2
    March 2, 2009

    Morgan at TheDebtDance.com

    I agree with Phil about making things simple. My husband and I use our debit card for every purchase and track expenses every few days to see if we need to shift, adjust, or go out on a hoot!

    We use a value-centered budgeting system. Our goals and dreams really rule.
    First tier are the gotta pay it stuff.
    Second tier of budgeting is what we want to spend on our dreams: getting our business going, getting out of debt, etc.
    Third tier is what’s left over: groceries, clothes, entertainment, etc.

    It makes money management our friend–finally.
    Face Your Dreams, Embrace Your Loves

  3. 3
    March 28, 2009

    Alan

    “Let me give you the definition of “rich” and “poor.” Poor people spend their money and save what’s left. Rich people save their money and spend what’s left.” – Jim Rohn

How much have you saved
using Ramit's advice?





$
Only numbers please