Just for one week, track every single expense. Keep all your receipts and enter them in your budget sheet. You may be surprised at how the seemingly "little" things add up. Keep going! A month of keeping track is even better.
Now that you see where the money goes, you can start planning on where you can save and invest. Even a little savings will make a difference if you do it long enough on a regular basis. Try saving just 1 or 2 dollars a day to start.
Even a small sum like $50 a month can build a nest egg of over $100,000 if you start at the age of 21 and stop at age 65, starting with an initial sum of $1000 and assuming a 5% rate of return. Try out some possible scenarios on the calculator below to see how you can benefit from regular saving and investing.
Calculator: Advantage of early investing
Keep it up! If you get a raise or unexpected money put that in your "nest egg" fund and forget you have it. Some other ideas for saving:
- Walk instead of taking the car for short trips. You will gain an extra bonus of better health!
- Take your lunch to work or "school" ( yes, I am talking about all you college and university students)
- Check out the free online movies instead of going out and paying to see the same movie
- Make extras when cooking so you have a quick meal ready in the freezer instead of ordering pizza