essay about ways to spend money wisely

How to Spend Money Wisely: 12 Hacks To Improve Your Habits

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“What’s the first thing that comes to mind when thinking of how you can improve your financial situation?”

Many people would say “spend less money.”

One way to do this is by buying something used. In fact, a study found that Americans buy 10% more new items than they did in 2008 because we have so many promotional offers available. Not only should you be trying to save some money on your purchases, but also cut all kinds of other expenses from your lifestyle and keep them at a minimum.

Usually, people spend more money than they need.

This can lead them to have less money saved or be able to afford the things they want.

However, with a few simple changes in your spending habits, you will be able to make more of what you earn and feel more satisfied.

In today’s world, it is easy to be overwhelmed by the amount of information available on how you should spend your money.

With more and more people struggling with their finances, I would like to share a few hacks that have helped me spend money wisely and simplify my life.

Also, I am going to include some simple money saving tips on how to spend less money! Do not get duped into buying things you did not plan on purchasing or spending more money than you needed to.

How to Spend Money Wisely

As you can see shortly, there are many ways to spend money wisely. Whether it be through saving, investing, or taking care of your health; with this article as a guide, you won’t have to worry about your money any longer.

This is meant to inspire people on how they can better manage their finances and live more efficiently, while still being able to get the things that they want.

Spending money wisely is a way of life, but it can be tough to know where exactly you should start.

Luckily for you, we will break down ten hacks for you to follow so that your money does not go to waste.

1. Pay Yourself First

You are probably wondering, why is saving money about how to spend money.

The first thing you should do to spend money wisely is to pay yourself first.

This could be saving for the future with an emergency fund, which can be used in case of emergencies or downturns in your financial situation. This can be done by contributing to a high-interest savings account and saving up to $1,000 or more for emergencies.

Or choose one of our money saving challenges to match your financial goals.

2. Take Care of You

You need to take care of your health, as that will improve the quality and longevity of your life.

Making wise choices on choosing quality food and healthcare may cost more money upfront, but in the long run, it will save you money on huge medical expenses.

You spend your money wisely by taking care of your health. Money spent on a gym membership, healthy food, and other medical expenses can save you even more money in the long run.

Many people love the idea of time freedom for this reason.

3. Invest in Your Future

One way to spend money wisely is by investing in your future. This might be done through a 401(k) or Roth IRA, which lets you invest pre-tax dollars and then withdraw them tax-free once you retire.

This can be a great way to save on taxes, but the money needs to stay invested for at least five years before you’re able to withdraw it without a penalty.

4. Choose Experiences

We live in a society that prizes material purchases and spending. Remember to prioritize experiences by getting outside. Not just for your health, but also on the mental and emotional levels, as well as the personal and even family levels.

Also, a plethora of benefits to spending money on experiences, not all materialism related.

Try to spend less on electronics and materialistic items that fill your home and more on experiences like travel or going out with friends.

This is a great way to spend time with your family and friends instead of buying things for them.

Related Reading: Overcome Gift Regret: Experience Gift Ideas That Do Not Go To Waste

5. Set Goals

Many of us, regardless of financial status, know that if we want to live on the right path without having our finances stress us out, then there are good habits to be followed.

Think about how much money you want to make in the next five years or ten years and make up how to get there.

Now, you need to line up your spending to make that happen.

Not sure how to set goals? Start here with making smart financial goals .

The next hack is to make a budget and stick to it, which will help you spend your money wisely by only spending what you have available in each category.

A budgeting strategy helps you develop better financial skills. These strategies are practiced in order to help prevent overspending and create a set spending plan for you.

Create a budget that includes all your expenses and then each time you get paid, put a little bit of your paycheck into each category.

7. Evaluate Your Spending

Oftentimes, we find ourselves buying items that are not necessary and just a waste of money. This hack is to evaluate what you’re spending your money on and think about whether or not you want to continue this habit.

For every purchase ask yourself if the item is worth it and what will happen if you don’t buy it.

By completing a no spend challenge , you will be amazed at the things you find out are not worth spending the money on.

8. Likeminded People

Next, you should try to spend less time with people who are going to make you feel bad about yourself.

This is a hard one but just think of the good things that will happen when you stop hanging out with people who make you feel bad.

If you are constantly around people you need to learn how to not spend money, then you will be battling upstream battle. Look for those who have the same mindset and are determined to spend money wisely.

9. Spend on Quality Over Quantity

The best way to buy quality items is to spend more money on them. Buying cheaper items has its risks, but over time it will lead to dissatisfaction with the product and waste of money.

If possible try to spend money on things that will last a long time and not just stuff like food or rent.

This concept of quality of quantity is not difficult to understand. For example, instead of owning 10 pairs of jeans that you think you need, you spend money on the two pairs of quality jeans that you love.

Because items are so cheap to pick up, it is easy to quickly fill our homes with quantity and excess stuff (plus we are spending more in the process). Instead, spend a little more and buy less of what you truly need or want.

10. Eat at Home

One way to save money is by cooking more at home and not going out to eat. You can also cut down on the amount of food you purchase, which will help you save a ton of money in the long run.

Instead of buying food that will go bad quickly or ruin your health, buy more expensive food. This way you are spending less money on the product but it is going to last longer and be better for you.

By spending money wisely, you must learn how to spend less money on food.

11. Use Tax-Advantaged Accounts

Specifically, I am talking about FSA or HSA, or dependent care FSA. This is when you set aside money each year for these purposes. Money goes into these accounts tax-free, so you are lowering your taxable income.

On how to spend FSA money, you must have the proper documentation on your plan. The same is true for how to spend HSA money.

The limits change each year on how much you can contribute to each of these plans, but the maximum you can spend tax-free is over $20,000 for a family.

This is a great trick to spend money wisely and lower the amount you owe in taxes. Just make sure to spend the amounts in the FSA each year!

12. Spend on things that add happiness to life

Personally, I have a hard time spending money. Period. This is something I am working on as we progress through our financial journey. Now, I look to spend money on ways that will improve our life or bring smiles to our faces.

Spend on things that add happiness to your life.

For example, if you’re happy with the new shoes you’ve just bought, then it’s worth spending money on them! If you love to travel, spend on travel. If you like reading fiction novels, spend on fiction novels.

Spend your money on things you enjoy and make the most of the disposable income you have.

How to Spend Money to Make Money

One of the best ways to make money is to give back. However, it takes some money to make money, which is typically frustrating to those who constantly want to make more money per year.

By selling a product or service, you are supplying them with your knowledge, advice, and understanding. Another way is through investments. Investing, while not always profitable, has companies that adhere to companies of all kinds.

One of the best ways to spend money wisely is to invest in ways to make money.

There are plenty of ways to make money and start your own business.

Here is a great book to open you up to the idea of starting your own business and the freedom with money it can bring.

Here are great ways to make money on the side:

• Sell printables and make passive income!
• Become a virtual assistant and make your own schedule.
• Learn to get weekly paychecks when investing in the stock market .
• Earn money with freelance writing on the side.
• Walk dogs with Rover and get paid cash.
• Drive for any of these companies and make money – Instacart , DoorDash , or Postmates .
• Start a bookkeeping business on your terms.
• Sell Earn easy money with flipping items Find great success with this Flea Market Flipper training.
• Have kids? Then, teach them to make money with Flea Market Flippers for Kids .

It is possible to make more money on your business than you make more money in your current job or career.

How to Spend Less Money

Many of us spend too much on material items that are not actively used. This creates a situation where we have to make more purchases in order to get the same level of happiness.

The first step towards becoming frugal is deciding what you want out of your possessions, and then only buying those things which will provide you with this goal.

Here are 32 easy ways to do that!

• Shop at Discount Stores: You don’t have to go all out with your shopping if you’re looking for a way to save some money. There are plenty of stores that offer great deals and you can still find some really cute clothes.
• Find Online Deals : You can find deals online for just about anything. This is a great way to get the deals that you might not know about. There are so many websites out there dedicated to helping you find the best deals and coupons.
• Save Money on Your Cell Phone Bill: Just because the cell phone companies want to charge an arm and a leg for service doesn’t mean you have to. There are plenty of options out there where you can find great deals on your cell phone bill without having to break the bank.
• Call and Cancel Unnecessary Services: Do you really need to subscribe to cable? How about getting rid of your gym membership because you know that all the exercise won’t do anything for your weight. The truth is you don’t need a lot of these things that are costing you money. Also, try a free service like Trim or Billshark .
• Buy Generic Items: Do your shopping at the grocery store and buy generic items instead of brand names for most of your purchases.
• Buy in Bulk: Buy items like toilet paper, cleaning supplies, and other things in bulk to save on the cost of each individual item. This is more so for families who can buy food in bulk.
• Start Couponing: This is a great way to save money. I know it’s not the most enticing offer, but if you’re looking to save money then coupons can be your best friend. You can go online and find coupons for items that are on sale at your favorite store or you can get them in the Sunday paper.
• Use Public Transportation: This is a great way to save on gas and wear and tear on your car.
• Get Rid of the Car: If you live in an urban area, it might be worth getting rid of the car and using public transportation or just walking instead. Or become a single-car family.
• Carpooling: One of the biggest hacks that many people are unaware of is carpooling- which can save up to $1,000 per year.
• Rent Things: Whether it is a video, movie, or power tools to complete a project, renting will save you money.
• Use Less Electricity: Turning off lights and other electronics when they are not in use can really help!
• Eat Spaghetti : Eating pasta saves money and reduces your grocery bill.
• Use the Library: If you like to read, the library might be another alternative to buying books.
• Borrow Books: Borrowing books from the library or your friends is a great way to read for free!
• Use Online Promo Codes: Using promo codes or coupon codes on all of your online purchases will make a huge difference. Here is a great place to find promo codes and get money back on your purchases.
• Eat Out Less Often: Eating out less can save money!
• Eat Less Meat: Eating less meat will save on your grocery bill! There are so many wonderful delish meals made with beans!
• Buy Used: If you must buy something but don’t want to spend much, consider buying used versions of the items you need. Buying used products will save money and help the environment.
• Share with Friends: Sharing your belongings, like clothes or toys, can save you money.
• Ask for Help: When someone offers to help you do something it’s only polite to take them up on it.
• Find Used Clothing: Buying clothing used can save you a lot of money and help the environment!
• Downsize Your Hobby: It’s important to live within your means. If you have an expensive hobby it may be time to scale back on the expense or find a cheaper one.
• Need vs Want: Try not to spend money on things that are “needed” but not “wanted.”
• Avoid Impulse Spending: Try to plan before you buy anything- think about what you need, the price of items, and if it is worth buying.
• Plan Free Activities: Plan outings with friends and family, rather than going to the movies or restaurants alone.
• Plan For Expensive Times: Give your friends a heads up before you go out on an expensive outing so they know it’s coming. They may be able to help cover the cost or provide a cheaper alternative. This will help everyone’s budget.
• Do Your Research: Research all of your options before you make any purchase- this will allow you to get the best bang for your buck and find the best deals.
• Bartering : If you must buy something, but you don’t want to spend much money on it-consider bartering with someone or buying used items instead of new ones (e.g., clothes, furniture).
• Know-How You Spend Money: Keep a budget to track your spending and be aware of how much money you have left at the end of the day or week so you can plan accordingly.
• Negotiate on Price: If you plan to buy something, don’t tell the retailer how much money you have until after they give their price- this can help save money and time by eliminating any final price negotiations.
• Think Before You Spend: Put some thought into your purchases before you make them- this will help you make sure you really want to spend money.

How Much Money Should you Spend?

There is a lot of conflicting information on how much money should be allocated to needs vs. wants, but this takes into account what percentage of take-home pay should be spent on necessities.

Here is the Cents Plan Formula we Use at Money Bliss:

• 50% to Basic Expenses
• 20% to Savings
• 10% to Giving
• 20% to Fun Spending

So, the average person should spend 50% of their take-home pay towards needs. That means you must spend your money wisely.

Keep a list of what you spend and how much it cost.

You should have some idea of how much money you are able to spend on what. This will help you decide whether it is worth buying a thing or not before purchasing it.

Use the list to see where you can make adjustments, for example spending more time with your family or finding fun things to do with no money .

Ready to Start Spending Money Wisely?

Spending money wisely can seem complicated at times.

The key to using money wisely is understanding how you spend your cash . Spending tends to happen automatically, which can lead people down the path of overspending and debt if not monitored closely.

The affordability of happiness and satisfaction depends intensely on the money we have.

The activities we could do, and expenses we could cut out, can be often atrocious and insufficient for our expectations.

Extreme dissatisfaction and the whole time earning less than we would desire, we may feel that we need to know how to spend money wisely.

The vital hacks elaborated in this post will help to understand caring for a budget, and changing our habits to spend more wisely.

When spending money wisely, people should be aware of their habits so they can change them in order to save more and spend less on things that do not bring happiness or benefit the person’s life.

If you want to save money, spend it on something that will make your life better or more enjoyable.

Know someone else that needs this, too? Then, please share!!

Did the post resonate with you?

More importantly, did I answer the questions you have about this topic? Let me know in the comments if I can help in some other way!

Your comments are not just welcomed; they’re an integral part of our community. Let’s continue the conversation and explore how these ideas align with your journey towards Money Bliss.

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Essay on Money Management

Students are often asked to write an essay on Money Management in their schools and colleges. And if you’re also looking for the same, we have created 100-word, 250-word, and 500-word essays on the topic.

Let’s take a look…

100 Words Essay on Money Management

Understanding money management.

Money management is about how you handle your cash. It’s like a game plan for spending, saving, and making sure you have enough for important things. You keep track of what you earn and make smart choices on what to buy.

Saving Money

Saving means putting money aside for later. Each time you get money, you should save a part of it. This can help you buy big things in the future or have money in case of emergencies.

Spending Wisely

When you spend, think about what you need versus what you want. Needs are things like food and clothes, while wants are extras. Always try to spend less money than you have.

Making a Budget

A budget is a plan for your money. You write down how much money you get and then plan how to spend it. Sticking to a budget helps you not run out of money.

Investing is using your money to try and make more money. It can be risky, so learn and start small. It’s a way to grow your savings over time.

250 Words Essay on Money Management

What is money management.

Money management means taking care of your money. It’s like knowing how to use your pocket money wisely. You plan how to spend it, save some, and make sure you have enough for things you need.

Saving is putting money aside for later. Imagine you want a new toy or a book. If you save a little bit of your money every time you get some, soon you will have enough to buy what you want. It’s like filling a piggy bank; drop by drop, it gets full.

When you spend money, think about what you’re buying. Ask yourself if you really need it or if it’s just something you want because it looks cool. Sometimes, waiting before buying something helps you decide if it’s important.

A budget is a plan for your money. You write down how much money you get and then list the things you need to spend money on, like food, school supplies, and clothes. If you plan it right, you can also save some money.

Why It Matters

Handling money well is a big part of life. When you learn about it while you’re young, you get better at making good choices with money when you’re older. It means you won’t run out of money when you need it, and you can even help others. Plus, you’ll feel proud that you can take care of your money all by yourself.

500 Words Essay on Money Management

Money management means taking care of your money. It’s like being the boss of your own cash. You decide what to do with it: spend it now, save for something big later, or even put some away for times when you might need it urgently. It’s important because it helps you make sure you always have enough money for the things you need and want.

Creating a Budget

Think of a budget as a spending plan. It tells you how much money you have, where it needs to go, and what you can spend without running out. To make a budget, list all the money you get, like allowance or birthday cash. Then, write down what you need to spend money on, like school lunches or saving for a new bike. What’s left is your spending money. Remember, a good budget helps you not spend more than you have.

Saving is like planting a seed that grows into a money tree over time. When you save, you set money aside for later. You might save for a game, a trip, or just to have some extra cash when you need it. A good tip is to decide on a certain amount to save each time you get money. This way, saving becomes a regular habit, just like brushing your teeth.

Smart Spending

Smart spending doesn’t mean you never buy fun things. It means thinking carefully before you buy. Ask yourself: Do I really need this? Will I use it a lot? Could I find it cheaper somewhere else? Sometimes, waiting a bit before you buy can help you decide if it’s really worth it.

Understanding Needs vs. Wants

Needs are things you must have to live, like food, a home, and clothes. Wants are extra things that are nice to have but you could live without, like toys and video games. Good money management means taking care of needs first and then seeing if there’s money left for wants.

Dealing with Emergencies

Emergencies are like unexpected storms that can shake up your money plans. It could be a broken bike or a lost school book. This is why you have savings. If you’ve saved up, you can handle these surprises without getting stressed.

Making Money Grow

You can make your money grow by investing, but this can be tricky. It’s like giving your money a job where it can earn more money for you. Talk to a grown-up and learn about things like bank accounts that earn interest. This means the bank pays you a little bit for keeping your money there.

Sharing and Giving

Money isn’t just for spending on ourselves. Sharing with others can make us feel good. You might give some money to help people in need or support a cause you care about. This is a part of money management, too, because it’s about deciding how to use your money to make a difference.

Managing money is a big responsibility, but it’s also a powerful skill. When you learn to manage your money well, you’re in control. You can reach your goals, handle emergencies, and even help others. Start practicing these money management tips, and you’ll be on your way to being a money management pro!

That’s it! I hope the essay helped you.

If you’re looking for more, here are essays on other interesting topics:

• Essay on Money And Happiness
• Essay on Modesty
• Essay on Modernism

Apart from these, you can look at all the essays by clicking here .

Happy studying!

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Spending Money Wisely

Author: Financial Success | Image: Financial Success

Figure out your budget

Making a budget can seem like a time-consuming thing to do, but it is one of the most important steps in order to ensure that you are financially organized. Creating a budget is going to allow you to track your spending, so you know exactly what you are spending your money on, and from there, you are going to be able to become more successful when it comes to achieving your financial goals. The 3 keys to creating a successful budget are tracking your spending, paying off major bills first, and then creating a spending plan.

There are many easy ways to start creating your budget, including

• An Excel Spreadsheet
• CashCourse Budget Wizard
• Mint: Personal Finance & Money (In the App Store)
• Template on the Office of Student Financial Success website

What creating a budget is going to do is help you see if you are overspending (spending>income) or if you are underspending (spending<income). If you figure out that you are overspending, then you need to decide to either reduce your spending or find an additional source of income to ensure that you are not going over budget.

Decide what is a need and what is a want

Deciding between a need and a want is an extremely important task when it comes to saving money, especially as a college student where the money is often limited. It can be very hard to decide between the two, especially when something like the new iPhone comes out or one of your friends asks you to go out to eat. However, figuring out what is a need or a want is the key to spending money wisely and sticking to your budget.

What are examples of Needs?

• Housing, Mortgage Payments, and Utilities
• Loan Payments
• University Fees
• Transportation
• Food (Groceries)

What are examples of Wants?

• Sources of Entertainment
• Memberships
• Brand New Clothes
• Dining Out/Drinking at the bars
• New Electronics

The needs and wants may differ between people depending on certain aspects of their life. While cutting out wants is important to maintaining a successful budget, it does not mean that you should cut out all the wants completely. One thing that is recommended when it comes to keeping track of needs and wants is to use the 50/30/20 rule. This means that 50% of your income should be devoted to paying for needs, 30% of your income can go to buying your wants, and the last 20% should be added to your savings.

Plug the leaks in your spending

Small spendings can add up and end up having a huge impact on the success of your budget and can often lead to you thinking, “where did all of my money go.” Stopping these leaks in your spending will ensure that you meet the goals that you set in your budget and that you are spending your money wisely.

Some of the ways to plug these spending leaks include

• Carry around a reusable water bottle to cut out needless spending on things to drink
• When going shopping, make a list and stick to it—no impulse buying.
• Carry cash instead of credit cards to ensure that you are only spending what you can afford
• Get rid of subscriptions that you don’t use anymore or are just unnecessary.
• Pack snacks from home to avoid higher prices at vending machines or gas stations
• Use subscriptions to streaming services such as Netflix or Hulu instead of paying for cable.

Limiting the amount of impulse buying and needless spending is going to help you stick to your budget and meet your goals. It will also allow you to have a better understanding of where your money is going and not leave you with that “where did all that money go” feeling. From plugging these leaks, you are going to end up spending less money and be able to save more.

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10 Simple Ways To Manage Your Money Better

Being good with money is about more than just making ends meet. Don't worry that you're not a math whiz; great math skills aren't really necessary - you just need to know basic addition and subtraction.

Life is much easier when you have good financial skills . How you spend your money impacts your credit score and the amount of debt you end up carrying. If you’re struggling with money management issues such a living paycheck to paycheck despite making more than enough money, then here are some tips to improve your financial habits.

When you’re faced with a spending decision, especially a large purchase decision, don’t just assume you can afford something. Confirm that you can actually afford it and that you haven’t already committed those funds to another expense.

That means using your budget and the balance in your checking and savings accounts to decide whether you can afford a purchase. Remember that just because the money is there doesn't mean you can make the purchase. You have also to consider the bills and expenses you'll have to pay before your next payday.

How To Manage Your Money Better

• Have a budget : Many people don’t budget because they don’t want to go through what they think will be a boring process of listing out expenses, adding up numbers, and making sure everything lines up. If you’re bad with money, you don’t have room for excuses with budgeting. If all it takes to get your spending on track is a few hours working a budget each month, why wouldn’t you do it? Instead of focusing on the process of creating a budget, focus on the value that budgeting will bring to your life.
• Use the budget: Your budget is useless if you make it then let it collect dust in a folder tucked away in your bookshelf or file cabinet. Refer to it often throughout the month to help guide your spending decisions. Update it as you pay bills and spend on other monthly expenses. At any given time during the month, you should have an idea of how much money you’re able to spend, considering any expenses you have left to pay.
• Give yourself a limit for unbudgeted spending : A critical part of your budget is the net income or the amount of money left after you subtract your expenses from your income. If you have any money left over, you can use it for fun and entertainment, but only up to a certain amount. You can’t go crazy with this money, especially if it’s not a lot and it has to last the entire month. Before you make any big purchases, make sure it won’t interfere with anything else you have planned.
• Track your spending: Small purchases here and there add up quickly, and before you know it, you’ve overspent your budget. Start tracking your spending to discover places where you may be unknowingly overspending. Save your receipts and write your purchases in a spending journal, categorizing them so you can identify areas where you have a hard time keeping your spending in check.
• Don’t commit to any new recurring monthly bills : Just because your income and credit qualify you for a certain loan, doesn’t mean you should take it. Many people naively think the bank wouldn’t approve them for a credit card or loan they can’t afford. The bank only knows your income, as you’ve reported, and the debt obligations included on your credit report , not any other obligations that could prevent you from making your payments on time. It’s up to you to decide whether a monthly payment is affordable based on your income and other monthly obligations.
• Make sure you’re paying the best prices : You can make the most of your money comparison shopping, ensuring that you’re paying the lowest prices for products and services. Look for discounts, coupons, and cheaper alternatives whenever you can.
• Save up for big purchases : The ability to delay gratification will go a long way in helping you be better with money. When you put off large purchases, rather than sacrificing more important essentials or putting the purchase on a credit card, you give yourself time to evaluate whether the purchase is necessary and even more time to compare prices. By saving up rather than using credit, you avoid paying interest on the purchase. And if you save rather than skipping bills or obligations, well, you don’t have to deal with the many consequences of missing those bills .
• Limit your credit card purchases : Credit cards are a bad spender's worst enemy. When you run out of cash, you simply turn to your credit cards without considering whether you can afford to pay the balance. Resist the urge to use your credit cards for purchases you can’t afford, especially on items you don’t really need.
• Contribute to savings regularly : Depositing money into a savings account each month can help you build healthy financial habits. You can even set it up so the money is automatically transferred from your checking account to your savings account. That way, you don’t have to remember to make the transfer.
• Being good with money takes practice :​ In the beginning, you may not be used to planning ahead and putting off purchases until you can afford them. The more you make these habits part of your daily life, the easier it is to manage your money, and the better off your finances will be.

Frequently Asked Questions (FAQs)

Why is money management important.

Without money management, personal finances are a bit of a mystery. This can lead to overspending and living paycheck-to-paycheck. Money management can help you have a better handle on your income and spending so you can make decisions that improve your financial status.

How do you improve money management?

You can improve your money management by regularly evaluating what you're doing with money and making changes that make sense for you. For example, if you don't have a budget, you could start by developing one. If you have a budget, you could track your spending and see how it lines up with your budget. Once you have an idea of your income and spending, you could choose to increase your savings, pay off debt, or start investing based on your financial goals.

Consumer Financial Protection Bureau. " Budgeting: How to Create a Budget and Stick With It ."

Consumer.gov. " Making a Budget ."

FiftyThirtyTwenty.com. " Income + Financial Stability in America ."

Consumer Financial Protection Bureau. " Spending Tracker ."

Consumer Financial Protection Bureau. " Bill Calendar: Know What You Owe and When It's Due ."

WSFS Bank. " 5 Ways to Save for a Big Purchase ."

Discover. " Six Tips On How To Stay Out of Debt ."

Consumer Financial Protection Bureau. " Looking for An Easy Way to Save Money? Make It Automatic ."

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Top Tips for Spending and Managing Money Wisely

You don't have to be a personal finance expert to be good with money. Anyone can take steps to develop good money habits and achieve greater financial flexibility and freedom! It all starts with understanding how to spend money wisely and how to manage your money effectively.

What Does it Mean to Spend and Manage Your Money Wisely?

Spending wisely is more than just keeping track of your bills and having a good credit report. Spending your money wisely is a way of life! Spending less than your income while continuing to pay your bills on time and in full allows you to save for future needs. ​Aligning your spending habits with what matters most to you will help you reach your biggest money goals.

Helpful Tips for You

Are you ready to get started on your journey to saving money and spending money wisely? Here are some helpful tips to consider:

• Track your spending—every dollar! Before you can manage your money wisely, you need to understand where your money goes each month. That's why tracking your spending is so important! Save your receipts and write each purchase in a notebook. You can also use a digital tool like Money Management to track and categorize your spending. Money Management will give you a very clear picture of your spending habits, which you can use to create an accurate monthly budget .
• Look for expenses to adjust, reduce or eliminate As you evaluate your spending habits, identify room for change. Some questions you may want to ask yourself include:
• Do your purchasing habits match your priorities and financial goals?
• Which categories could you trim to save more money?

You can save money by listing your expenses in order of importance from "must-haves" like living expenses to "nice-to-haves" like new shoes and clothes.

• ​​​​Give your money a purpose After you pay bills, if you don't have specific goals for your leftover income, you might end up spending the funds you have leftover at the end of the month rather than saving them. But by giving your money a dedicated purpose, you can use it to help you live the life you want to live! What goals do you have for your money? It could be boosting your emergency fund, upgrading your car, paying for a child's education, taking a dream vacation or even donating to the causes you care about. Once you have enough money saved to start putting it towards certain goals, open separate  savings accounts and name them for each goal. These savings accounts will help you establish a plan for your extra money, including any additional income you receive through raises, bonuses or your tax refund.
• Stay flexible Learning to develop a financially savvy plan to spend and manage money wisely takes practice. When you're first getting started, you'll probably need to adjust your budget and spending habits so that you can meet your goals. Stay flexible and try to make money management part of your daily routine—it's worth it!​

For more tips on the road to financial independence and how to spend money wisely, view our Spend & Mange Wisely Brochure here .

How We at Wright-Patt Credit Union Can Help

At WPCU, we want to help you succeed in your journey to spending wisely and give you the tools you need to spend money wisely. We have a variety of helpful tools to make the process easier, including budgeting worksheets and spreadsheets , spending tips and interactive learning modules for spending and managing your money. ​

Greater Good Science Center • Magazine • In Action • In Education

Six Ways to Get More Happiness for Your Money

When we think about spending our money wisely, we usually focus on getting the best value for the lowest price. We comparison shop and download apps to find the latest discounts and deals; we’re seduced by the daily special or the limited-time offer.

But, for those of us lucky enough to have disposable income, what if we defined wise spending in terms of the happiness that it brings? That’s a completely different way of thinking about our purchases, and one that we have little practice in.

“Most people don’t know the basic scientific facts about happiness—about what brings it and what sustains it—and so they don’t know how to use their money to acquire it,” write Elizabeth Dunn and her colleagues in a 2011 study .

Luckily, more than a decade of research has been investigating how different types of purchases affect our well-being, and it can help us turn spending into a happiness practice in its own right. The key, it seems, is to spend money in ways that bring you closer to other people.

1. Spend money on experiences

In a landmark study in 2003, researchers found that buying experiences —like seeing a Broadway play or going for coffee with a friend—improve our well-being more than buying possessions . Across different surveys, more than 1,500 participants tended to say that experiential purchases made them happier and were better investments, and that their moods were more positive when recalling them.

Thus began more than a decade of research into this phenomenon, unearthing some of the reasons why buying experiences is so beneficial—which can inform our financial choices in the future.

But first, some definitions: Although the distinction between experiences and material goods is sometimes fuzzy (think: books and cars), we tend to intuitively understand which is which. Researchers typically define experiences as things we buy in order to do something, which don’t endure in the form of a possession; and material goods as things we buy in order to have something.

2. Better yet, spend money on experiences you share with others

Not all experiences are created equal, though, and it’s up to us to choose the ones that are most fulfilling. In a 2013 study , when researchers separated out experiential purchases into social ones and solitary ones—going out to dinner with friends or alone, for example—participants reported that the solitary experiences brought just as little happiness as the material things.

“It may be less the doing that creates happiness than it is sharing the doing,” the authors of that study explain.

Even if we can’t share an experience with others initially, we can share it with them later by telling the story—another advantage that experiences have over material things. Our new kitchen gadget or trench coat loses its conversation value shortly after we buy it, but “talking to others allows us to relive experiences long after they have happened. In this sense, experiential purchases are gifts that keep on giving,” write the authors of a 2015 study .

In fact, that study found that the more we chatter about our experiential purchases, the more happiness we derive from them. This’ll make a great story later is actually a real benefit. A 2012 study also found that people are more likely to mention experiences they bought (vs. material things) when recounting their life story.

With a little change in perspective, though, we can extract more happiness from our possessions by focusing on the experiences they facilitate. At least three different studies found that thinking about gray-area purchases like music and TVs more as experiences than objects helped people see them as more self-expressive and reduce the risk of buyer’s remorse. So the next time you buy a new flatscreen, think of it not as a fancy piece of technology but as a prop for cosy evenings with your spouse, and you might enjoy it all the more.

The story emerging from the research is that experiences become part of our identity, which makes them feel valuable in their own right. Compared to possessions, we worry less about what others will think of our experiences, and they don’t generate the same kind of regret . If anything, we lament the experiences we didn’t buy: the shows we were too busy to attend, the trips we put off. Though experiences may be fleeting, they’re essential to our happiness—so now you’ve got a science-backed excuse to invest in them.

3. Spend money on other people

If you want to bond with other people, you could buy experiences to have with them—or you could spend money on them directly.

In a 2008 study , researchers gave participants up to $20 to spend on themselves or on others that same day, then called after 5 pm to see how they were feeling. In the end, contrary to expectations, participants reported being happier after treating others than treating themselves. The same was true of employees who spent more of their bonuses on donations and gifts, rather than personal expenses and treats.

And this effect may not be restricted to rich, white Westerners. For a 2013 study , researchers gave participants in Canada and South Africa the choice to get $2.50 in cash, take home a $3 goody bag, or give a $3 goody bag to a sick child. Those who made the generous decision reported greater positive emotion at the end of the experiment, in both countries. So did participants in India who simply remembered purchases made for others, compared to remembering purchases for themselves or not recalling anything in particular.

But just because it typically feels good to spend on others doesn’t mean that all generous purchases make us feel warm and fuzzy. Research is starting to understand exactly when so-called “prosocial” spending contributes to well-being, and how to find the most fulfillment in giving.

For example, another 2013 study distinguished between spending on others that strengthens our social connections and spending on others that doesn’t. Researchers gave participants a $10 Starbucks gift card to use that day, in one of four ways: treating themselves to a coffee alone, giving the card to someone else, taking a friend but spending the card on themselves, or taking a friend and treating them. In the end, the happiest participants were the last group: the ones who combined spending on others with social connection (and venti caramel lattes).

4. Spend money on the right people

Does it matter whom we spend money on? Preliminary research suggests that it might. In a 2011 study , participants who recalled spending $20 on someone close to them reported feeling more positive emotion than those who recalled spending $20 on an acquaintance. In the context of evolution, the researchers explain, this makes sense: Early humans who enjoyed helping family members were more likely to see their DNA survive.

The research about spending on others is particularly relevant when we consider donating to charity. For example, it’s important for donors to see the positive impact : When Canadians were given the chance to donate to the charities UNICEF or Spread the Net, bigger donors reported feeling more positive emotion and more satisfaction with life than smaller donors—but only those who gave to Spread the Net, whose pamphlets emphasize that a single bed net can prevent malaria and save a child’s life.

Simon Fraser University assistant professor Lara Aknin , who was involved in both of these studies, applies this research to her own life by treating friends and family to small gifts, and trying to make donations that have a big impact. The upshot of her research is that if giving leaves you feeling detached or drained, there may be smarter ways to allocate your dollars so everyone can benefit.

As you might have noticed, almost all of this research asks people to recall spending from the past, or contemplate imaginary choices. Researchers will gain even greater insight when they start to survey participants in real-time to see how they’re feeling about their purchases, like this 2016 study did, or follow them for years after a purchase to see how those feelings change with time.

5. Express your identity through spending

Although dozens of studies support the notion that spending on experiences and other people is advantageous in general, perhaps you’re skeptical. Sure, that may be true for other people, but not for me , you might think—and in some cases, you just might be right. Once general trends are identified, the researchers of a 2016 study explain, the science of happy spending will have to start accounting for individual needs and preferences.

For example, demographics and personality may influence how spending affects our happiness. Several studies found some evidence that the happiness advantage of experiential purchases (over material ones) is even stronger for women than it is for men; in that pioneering 2003 study , it was also stronger for young people, highly educated people, and city dwellers.

In contrast, people who behave more materialistically—tending to accumulate possessions rather than experiences—seem to derive equal happiness from both types of purchases, a 2014 study found. Why? Researchers discovered that experiences are less critical to their identity; these aren’t people who define themselves by the things they’ve done, like the fun-loving adventurers who splurge on plane tickets or the foodies first in line at five-star restaurants.

Meanwhile, and perhaps unsurprisingly, people who have little concern for others don’t seem to derive greater happiness from prosocial rather than selfish spending. Future research will have to investigate whether all these findings are merely blips, or evidence of real and robust differences. 

A 2016 study specifically tested whether personality influences the happiness we get from our purchases, analyzing six months’ worth of spending by customers of a UK bank. Purchases were grouped into 59 categories, from gardening to coffee shops, accounting to dentists, which each got a Big Five personality score. (Spending on charities might reflect conscientiousness and agreeableness, for example, while spending on tourism might reflect openness to experience and extraversion.) Participants with a better match between their personality and the personality of their purchases reported more satisfaction with life.

In a follow-up study, the researchers contrasted two stereotypically opposite purchases: shopping in the quiet, reflective haven of a bookstore or the bustling, social environment of a bar. They found that spending $10 at a bookstore increased the happiness of introverts, and spending at a bar increased the happiness of extroverts—but not vice versa.

“Money enables us to lead a life we want,” says coauthor Sandra Matz, a PhD student at the University of Cambridge. As she and her coauthors write, “Finding the right products to maintain and enhance one’s preferred lifestyle could turn out to be as important to well-being as finding the right job, the right neighborhood, or even the right friends and partners.”

6. Think less about spending

More on spending and happiness.

Learn how spending money on others can lower your blood pressure .

Discover how to make giving feel good .

Watch Sonja Lyubomirsky discuss whether money brings happiness .

Explore how sadness affects our spending .

In the end, though, the best way to cultivate happiness through spending may be to not focus on spending so much in the first place.

In one 2002 study , for example, researchers found that adults were happier around Christmas—feeling more satisfied, more positive, and less stressed by the holiday craziness—when they put greater emphasis on family and religion and less emphasis on giving and receiving. Just this year, a new study found that people who valued time over money tended to be more satisfied with their lives in general and felt more positive and less negative emotions recently.

It’s certainly misguided to stake all our hopes of happiness on our purchases. But so is ignoring the role that they do play in our well-being, a role that is becoming clearer and clearer. Buying is an opportunity to express our personality, to connect with others, and to craft a meaningful life story, and what better definition is there of money well spent?

About the Author

Kira M. Newman

Kira M. Newman is the managing editor of Greater Good . Her work has been published in outlets including the Washington Post , Mindful magazine, Social Media Monthly , and Tech.co, and she is the co-editor of The Gratitude Project . Follow her on Twitter!

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How to Manage Your Money Wisely

Last Updated: March 20, 2024 Approved

This article was co-authored by Samantha Gorelick, CFP® . Samantha Gorelick is a Lead Financial Planner at Brunch & Budget, a financial planning and coaching organization. Samantha has over 6 years of experience in the financial services industry, and has held the Certified Financial Planner™ designation since 2017. Samantha specializes in personal finance, working with clients to understand their money personality while teaching them how to build their credit, manage cash flow, and accomplish their goals. There are 12 references cited in this article, which can be found at the bottom of the page. wikiHow marks an article as reader-approved once it receives enough positive feedback. In this case, 95% of readers who voted found the article helpful, earning it our reader-approved status. This article has been viewed 118,455 times.

Managing your money can seem like an impossible task, but that is only because you haven't taken the time to start managing it. Today, keeping your finances in order is easier than ever. With careful budgeting, smart saving, and some basic attention to your income and expense, you can manage your money wisely without getting an MBA.

Budgeting Your Money

• Any additional money (tips, bonuses, etc.) should be considered "extra." By planning for only your guaranteed income you ensure that you will have enough money to cover living expenses should anything happen. It also leads to the happy "surprise" of extra money when it comes.

• If you spend cash, keep the receipt and make a note of what you bought.
• Apps like Mint, Mvelopes, HomeBudget, and more allow you to sync your credit cards, bank accounts, and investments to one place, providing graphs of your spending based on categories. This is a great way to get a view of your finances with very little work needed.

• Fixed Expenses: These are things that do not change month to month but must be paid, including rent, car/loan payments, etc.
• Essential Expenses: These include food, transportation, and utilities -- anything that you need to live but whose cost changes from month to month.
• Non-Essential Expenses: This is everything else, such as movie tickets, drinks with friends, and toys/hobbies. This is the biggest place most people realize they can save money.

• Place your month income and expenses side-by-side in a spreadsheet. You can also write them down in a journal or notebook. Having these numbers next to each other lets you see how much money you have left over to spend.

• 10% is the bare minimum you should be putting aside into savings. This will quickly grow, and often will not hurt you much in the short-term. That said, this money should also be used to pay off any debt if it is large and interest payments are big.
• 20% is considered a good, safe amount of savings. This ensures that, ever 5-6 months, you end up with enough saved income to protect you for a full month if something happens to you. It allows you to save a lot of money without drastically affecting quality of life.
• 30% is the goal everyone should shoot for. This allows you to save money for retirement, big activities like vacations, and large purchases (cars, college, etc.). It may, however, limit what you can afford in the short term. [3] X Research source

Spending Smartly

• What are you priorities in life -- good food, vacations, or just time with the family? Knowing what you personally care about buying can help avoid costly impulse buys.
• What things in your life can you cut and hardly notice -- such as a scone to go with your morning coffee, the 200 cable channels you hardly watch, bottled water, etc?

• Read all of the agreement form before signing up for your card. What is the monthly interest rate? How is minimum payment calculated? Are there annual or overdraw fees?
• Always try and pay more than the monthly minimum. If you pay the entire balance each month, for example, you won't pay any interest down the road.
• One credit card is enough -- juggling multiple bills and statements is a surefire way into credit card debt.
• Curb spending on credit so that you stay within 30-40% of your limit. You should never get close to your limit, as this is often difficult to repay without exorbitant interest rates. [5] X Research source

• Making grocery lists will keep you on track in the store, helping save money and plan meals effectively so no food is thrown out.
• Never buy something just because it is on sale -- you are still spending money, no matter how much the advertisement talks about "savings." [6] X Research source

• Browse online and set an appropriate spending cap -- the absolute maximum you will spend on a car/house/etc. Be very strict about this cap, no matter what a salesman says.
• Look up how much the object should cost and memorize the number.
• Check the prices at 2-3 different vendors to compare them. If you feel comfortable negotiating, you can mention to a vendor that you've found a similar or better price and ask them to lower theirs.
• If you have time to spare, wait and look for sales. Typically, for example, car dealerships offer sales in the summertime. [7] X Research source

• When buying food you only save money if you don't throw any out, otherwise you simply paid more money for the same amount you normally eat.
• Learn to read "unit price" which is the small label in stores that says "price per pound" or "price per ounce." Bulk items have a lower unit price, which means you are getting more product for less money.

Saving for the Future

• What are your fixed and essential expenses for one month? Multiply this number by 3-6 months to get your minimum emergency savings.

• Start saving for the holidays 5-6 months in advance. Even $50 a month will give you a cushion of $300 for gifts by December.
• Saving to send your kids to go to college can't start early enough. Make separate savings accounts for them when they're born and make saving a priority.

• The exception to this is high-interest credit card debt. If you find yourself sinking into a hole of credit card payments or are only able to pay interest, you may save more money by taking 2-3 months to pay them off.

• When you get a raise, add that amount to your monthly savings. You will keep your same quality of life and save much more in the long-term. [13] X Research source

• Never remove money from a 401k or long-term investment before it matures -- you may have to pay a fee or relinquish all the gains you've made.

How Can I Be Smarter With My Money?

Expert Q&A

• Managing your money wisely is, above all, about restraint. Many of the benefits of careful financial planning don't come true for 20 or 30 years, making it seem better to spend money right now. Think of saving, instead, of spending on yourself and your future. Thanks Helpful 4 Not Helpful 0

• Investments are inherently risky -- you never know 100% if it will pan out. Talk to a financial adviser if you want to invest a significant amount of money in anything. Thanks Helpful 6 Not Helpful 2

You Might Also Like

• ↑ Samantha Gorelick, CFP®. Financial Planner. Expert Interview. 6 May 2020.
• ↑ http://www.forbes.com/sites/robertberger/2015/03/03/how-much-of-your-income-should-you-save/
• ↑ https://www.mappingyourfuture.org/money/creditcards.cfm
• ↑ http://mywifequitherjob.com/how-to-build-wealth-by-spending-money-wisely/
• ↑ http://www.goodhousekeeping.com/life/money/advice/a19098/125-tips-to-save-money/
• ↑ http://www.sheknows.com/living/articles/808185/tips-on-how-to-save-money-and-spend-wisely
• ↑ http://www.investopedia.com/articles/pf/08/pay-in-cash.asp
• ↑ http://www.bankrate.com/finance/savings/how-big-should-emergency-fund-be.aspx
• ↑ http://beginnersinvest.about.com/od/retirementcenter/a/060104a.htm
• ↑ http://www.kiplinger.com/article/retirement/T047-C000-S002-how-to-retire-rich-4-smart-steps-at-ages-21-35.html
• ↑ http://www.investopedia.com/articles/retirement/07/plan_retirement.asp

About This Article

The key to managing your money wisely is only spending what you can afford and saving for a rainy day. Keep track of your income and expenses so you know how much money you have leftover to spend. Try to save around 20 percent of your income for future investments and purchases. It's also a good idea to keep 3 to 6 months’ worth of living expenses in a savings account in case of an emergency, like losing your job or having to pay for extra medical bills. Only use credit for bills and purchases you know you can afford at the end of the month. That way, you won’t end up paying extra interest. When you’re making big purchases, like a new car or computer, do plenty of research so you can find the best deal and save money. For more tips, including how to invest your money for the future, read on! Did this summary help you? Yes No

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Creating a Realistic Student Budget: How to Save and Spend Wisely

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Budgeting is a fundamental skill that can greatly impact your financial well-being, especially as a student with limited income. Here’s a guide to creating a realistic student budget:

Calculate Your Income

Start by determining your sources of income, which may include part-time jobs, internships, allowances, or financial aid. Having a clear picture of your income will help you allocate funds more effectively.

List Essential Expenses

Identify your essential expenses, such as tuition, rent, utilities, groceries, transportation, and insurance. These should be your top priorities when allocating your budget.

Set Savings Goals

Allocate a portion of your income to savings. Building an emergency fund and setting aside money for future goals (like travel or post-graduation plans) will provide you with a financial cushion and a sense of accomplishment.

Track Discretionary Spending

Non-essential expenses, such as eating out, entertainment, and shopping, can add up quickly. Keep track of these discretionary expenses to ensure they don’t exceed a reasonable portion of your budget.

Look for Cost-Cutting Opportunities

Explore ways to cut costs without sacrificing your quality of life. Consider cooking at home, using public transportation, or taking advantage of student discounts.

Review and Adjust Regularly

Your financial situation and priorities may change over time. Regularly review your budget to make necessary adjustments. Stay flexible and be willing to adapt your budget as needed.

Avoid Credit Card Debt

While credit cards can be useful tools, they can also lead to debt if not used responsibly. If you use credit cards, pay off the balance in full each month to avoid high-interest charges.

Creating and sticking to a budget requires discipline and commitment, but the financial peace of mind it provides is well worth the effort. With proper budgeting, you can manage your expenses, save for the future, and avoid unnecessary financial stress.

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11 Quick Tips For Spending Your Money More Wisely

Do you ever find yourself wondering how you can spend your money more wisely? 

Money is a sensitive subject for a lot of people, they work, they earn and they spend – rinse and repeat.

But rarely do people put much thought into how they could spend their money in a wiser manner so that they maximize the benefit of every dollar spent.

The goal of this article is to give you 11 quick tips on how you can spend your money just a little more wisely

So let’s jump right into it.

Spend Money on Self Improvement

One way to spend your money more wisely is to spend it on things that support self improvement.

This could include things like buying and reading books, taking online courses, learning a new language, taking music lessons or trying out a new sport.

I never look at spending money on self improvement as “spending money”, as I look at it more of an investment in my future self.

While these investments may not always result in monetary gains such as a higher salary, they can result in a happier you.

Research shows that we’re happier when we’re learning and improving at something.

Think about a time you did something for the first time that you’ve been working really hard on, isn’t that a great feeling?

As people get older, they tend to stop learning and looking for ways to self improve as much as they used too, but this shouldn’t be the case!

Spending money on self improvement is one of the best things you can spend your money on in my opinion, and again, your return on investment doesn’t have to be from a financial viewpoint.

You return on investment could just be a happier you, and from my perspective, that’s even better.

I’d recommend budgeting a portion of your income every month towards self improvement. It doesn’t have to be a lot, but even $25-$50 Quick Note #1

Invest a Portion of Your Income Every Month

Another great way to spend your money more wisely is to invest it.

Similar to self improvement, money you “spend” on investments is more so an investment in your future life as opposed to an expense.

I’d recommend saving 10%-15% of your pre-tax income for retirement. So if you make $40,000 a year, you should be investing at least $4,000 a year for retirement.

If you don’t have a retirement account open yet, I’d recommend opening one up with Wealthsimple for the reasons I explain in my article here, that’s who I invest my money with and it’s so easy. 

I just select my risk level, deposit my money and move on. It costs no money to open and fund your account and the entire sign up process, it’s really simple.

If you don’t have that much extra money to invest every month, that’s completely okay, but every one can afford to invest a little, even if you are living paycheck to paycheck.

Thanks to compound interest, you’d be very surprised at how much a little bit of money can accumulate into over the course of a few decades.

For example, let’s say you are 30 years old and you invest $200 a month into a retirement fund until you retire at age 65. 

Assuming a 10% average return over that 35-year period, do you know how much you’d have at retirement?

$759,327.61!!

Despite your total contributions only equalling $84,000 [$2,400/year x 35 years], you’ll be retiring with over three quarters of a million dollars. 

Not bad hey! 

Disclaimer:  This 10% return on investment is by no means guaranteed. This number is based on what I think is possible over a 35-year period.

So please people, invest a portion of your income every month. From a long term perspective, this is the best way to spend your money.

And again, it doesn’t have to be a lot. $200 a month is 10% of a $24,000 a year salary. I know you can do this.

Not only is investing your money a wise move financially, but you’ll actually probably be happier too in knowing that your financial future is looking bright.

Maximize Happiness Units With Every Dollar You Spend

In order to spend your money as wisely as possible, try and maximize your happiness units with every dollar you spend.

If you are wondering WTF is this guy talking about, I apologize.  

But basically all I mean is that you should try and avoid spending money on things that don’t add much happiness to your life.

For example, if you love to travel more than anything in the world, then spend your money on travel.

If you absolutely love reading fiction novels, then spend some of your money on fiction novels.

We don’t have to complicate this.

I love to play hockey so I spend a lot of my disposable income on ice time registration fees. I also love to do Crossfit, and I spend close to $200 a month to do it. 

Why? Because even though I may be paying a lot of money to do these things, if I don’t spend it on things that make me happy, then I’ll just end up spending money on random things that don’t add any value to my life – which is never a good idea. 

So be proactive with your spending and spend your money in a way that makes you happy.

No one is here to tell you what makes you happy, all I’m saying is don’t feel bad about spending money (even over spending) on things that add true value to your life.

Of course, you need to spend money on life’s basic essentials like food and shelter, but after the necessities, start looking at ways you can spend your money in a manner that maximizes your happiness. 

For example, instead of buying the new $800 iPhone, think about how much happiness your current phone brings you, and then think about what else you could do with that $800.

In other words, determine the trade-off you’re making when you make big purchases and ask yourself “am I maximizing my happiness with this purchase?”

If you are, then great, pull the trigger and buy whatever it is you’re considering. 

But if not, and you think this money is better spent somewhere else, than you might want to reconsider.

Buy Things on Second Hand Marketplaces

Another great way to spend your money more wisely is to buy things through online second hand marketplaces.

You would be shocked at what you can find on these platforms. 

Some common second hand marketplace platforms include: 

• Facebook Marketplace 
• Kijiji (Canada)

The great thing about buying things on second hand marketplaces is that while you can often find amazing deals, you also don’t pay sales tax. 

While most things on these marketplaces will be in fact, second hand, this doesn’t mean that they’re automatically any lesser of a product.

For example, I love golfing and I get all my golf clubs second hand on places like Facebook Marketplace and Ebay. While my handicap would indicate otherwise, these clubs are as good as new, yet they sell for a fraction of the price.

I’ve included an image here below of two golf clubs I got this year, a Taylor Made Driver and an Odyssey Putter, I got them on Ebay for roughly $155 each, they were essentially in mint condition and only been used a few times.

If I were to buy them new, it would have cost me close to $800. 

So always look for things on second hand marketplaces before buying them brand new. 

Common things people buy on these platforms are sports equipment, consumer electronics, furniture, jewelry and of course clothes.

Obviously you can’t buy everything second hand, sometimes it’s just more convenient (and sanitary)  to buy things at a retail store, but if you are buying something over $50 in value, I’d always suggest at least looking on a few marketplaces first.

You’ll be surprised at what you find, as the old saying goes, “one man’s trash is another man’s treasure.”

Spend Money on Health and Wellness

A great way to spend your money more wisely is to spend it on your health and wellness.

Now, health and wellness can mean a lot of different things and I’m not a doctor, a psychologist, a counselor, a health and wellness coach or anything like that, so I don’t want to overstep here –  but all I will say is that when I spend my money on things that improve my overall mood and general feeling of healthiness, I never regret it.

Whether it’s exercise, nutrition, meditation, yoga or whatever, it really doesn’t matter. Spending money to improve your overall state of wellness is rarely a bad idea.

Similar to self improvement, health and wellness is an ongoing choice people make on a daily basis. It’s not a one off event, it’s a lifestyle.

Because of this, I always recommend making room for your health and wellness choices within your budget – we’ll talk about budgets soon.

Spend A Little More For Higher Quality Items

In my opinion, spending a little extra money on higher quality items is a wise money move.

I know most of this article is about how to spend less for more, but I actually think buying quality things in the long run will save you money.

With that said, this doesn’t apply to everything. For example, buying a $200,000 Mercedes G-Wagon, although a high quality car, probably won’t save you money in the long run.

But buying quality, durable clothes that will last you a few years, now that’s money well spent!

I love a good deal more than anyone, but when it comes to clothes for example, I am Lululemon all the way.

The shirts don’t shrink, the pants don’t wrinkle and the boxers fit perfectly. 

Am I paying more than a typical pair of pants cost? Yes, most definitely, but I’ve been wearing the same pair of Lululemon ABC pants for years now. 

Because they’re great quality, I don’t have to get new ones every few months, so in the long run, I really feel like I’m saving money, plus I feel good about what I’m wearing. 

Again, I don’t always pick quality over price, if I’m buying a whiteboard for my kitchen – Dollarama I go. Golf balls for the summer  – Walmart (fore left!!).

But I truly do think you’re better off spending a little extra money on higher quality items in some cases. 

Some Items I Don’t Mind Paying More For:

• Sports equipment
• Coffee Makers
• Furniture 

And remember to look on second hand marketplaces for quality items too, that way you get a high quality item for a cheap price, win win!

Budget Your Spending

Budgeting has been discussed throughout this article a few times already, so I thought it would be a good idea to include it as a stand alone tip.

While it may be boring, creating and following a budget is a crucial part of being a responsible spender.

Budgeting your money helps give every dollar you earn a job, and I think that is so important when trying to spend your money more wisely.

If you haven’t already, I’d strongly recommend building your budget in something like Excel or Google Sheets. 

I’ve included an image below of the budget I created for myself.

As you can see, I don’t complicate this at all. 

Besides taxes (which are automatically deducted), the first thing I budget for is my investments. Then based on what I have left over after my taxes have been paid and I’ve paid myself (investing), then I live off what’s left.

As you can see, I have a  free cash flow section, that is my unbudgeted spending I give myself every month. 

This is for things like gas, food, eating out, movies, beer, travel, etc. So it’s not all work, no fun! 

What I love about this budget is that it gives me the ability to spend money in a guilt free manner.

I actually have a separate chequings account that I transfer my free cash flow to every month. That way I know whatever I have in that account is my money to spend as I please.  My goal is for that amount to always be increasing

So not only will creating a budget help you better save and invest your money, but it will also give you more freedom to spend your money without feeling any remorse. 

Another win-win situation! 

Buy Used Vehicles 

Buying used vehicles as opposed to brand new ones is a wise way to spend your money.

As I mentioned earlier in this article, just because something is used, that doesn’t mean it is damaged.

The average car payment in America today is $568 per month. $568 per month – you read that right. Isn’t that just insane?!

Unfortunately, most people treat a car payment like a house payment, they think it’s just a part of being an adult. 

But it really doesn’t have to be that way, there are more used cars for sale these days than dealerships know what to do with.

Not to mention all the used car websites available like Cargurus and AutoTraders .

Or my personal favourite, and where I got this beauty below. Facebook Marketplace.

For $2,500 I might add

With that said, I’m just generally not really that into cars.  Outside of taking me from point A to point B, they don’t add much value to my life.

If on the other hand, you really love cars (trucks, whatever), who knows maybe that $568 a month is worth it to you.

I’m not here to judge, just something to think about.

Remember, try and spend your money in a way that maximizes your happiness.  I personally would much rather spend that near $600 a month on a few extra vacations each year. 

Listen, I have no problem driving a 2008 Nissan Pathfinder if that means two more trips somewhere sunny every year. 

But again, different strokes for different folks, most of you probably think I’m insane for spending $200 a month on a gym membership.

In any event, here are a few things you should know when buying a used car . 

Pay for Things in Cash

Paying for things in cash as opposed to credit is a great way to spend your money more wisely. 

Spending money with cash is a much more painful experience than just swiping your card, which in the short term, might seem like something you’d want to avoid (pain = bad), but in the long run, it’ll save you from over spending.

Think about your own spending habits now, would it be easier to hand over $150 in cash to a cashier, or to just swipe your credit card?

Duh, swiping the card.

But again, while this experience can be a very convenient one, it can cause people to live a life they can’t afford.

Banks and credit card companies make money off your debt, so they’ll basically approve credit to anyone and their dog, avoid this trap!

Most of us highly overestimate our ability to pay back high credit card balances.  Quick Note #2

So why not just buy things with cash? and if not actual physical cash, use your debit card. While it’s not as painful as paying for things in cash, it’s better than using a credit card.

Want to know another reason why spending money with cash is a wise decision? Due to the experience being more “painful”, we tend to savour and appreciate whatever it is we buy just a little bit more.

Avni Shah (a Duke University grad student) talks about this theory in a Forbes article from 2016 titled Paying Cash Is Painful, And Makes You Value Your Purchase More .

So not only will you appreciate your purchases more when you buy things with cash, but you’ll also be more financially responsible with your money and be less likely to live outside your financial means.

Buy Things On Sale

Not this tip is a pretty obvious one, but I can’t not include it. People who are great at spending their money wisely often buy things on sale as opposed to paying full retail price.

While a 10%-15% discount on a one time purchase might not be a lot of money standing alone, over the course of 20-30 years, you’ll end up saving thousands of dollars.

But here’s the thing, you don’t always have to wait for things to go on sale, there are proactive ways you can go about consistently buying things at a discounted price.

For example, if you shop online a lot, I’d highly recommend installing the Honey extension onto your browser.

I will leave a video here below on what Honey is and how you can install it, but in short, Honey basically scours the internet to find you discounts and coupon codes for anything you have in your online cart.

Another proactive approach to buying things on sale is to look for the clearance or discount section on a retailer’s website.

For example, on Lululemon’s website here they have a “We Made Too Much” section, the deals you can get here are pretty great, but oftentimes they’re only offered on the website and not in store.

So always look online before buying something in store, you’ll often find better prices.

Another quick tip for doing this is to subscribe to your favourite stores email newsletter. This way you’ll get notified when things go on sale. And trust me, they’ll notify you to death.

As mentioned earlier, buying things on sale won’t change your life overnight, but over the course of your lifetime, it can make a significant financial impact.

Be Generous with Your Money

Last but not least, generosity. Being generous with your money is something you’ll rarely, if ever, regret.

Similar to tips like spending money on health and wellness and self improvement, being generous with your money is more of a lifestyle then a one off event.

So whether it’s donating money to a local charity, getting your family members Christmas gifts or picking up a round of beers for your friends, it’s always a good idea to spend money on other people as opposed to just yourself.

As I talked about earlier in this article, it’s important to try and maximise your happiness with every dollar you spend, and I think financial generosity can play a big role in that quest.

Phillipe Tobler (a neuroeconomics professor) talks about this topic in a Times article titled Being Generous Really Does Make You Happier.

He says that “ research has indicated that spending money on others can be as effective at lowering blood pressure as medication or exercise.”

Additionally, he goes on to say that giving a way a little bit of money will give us those same warm fuzzy feelings that you’d get when giving away a lot of money.

So what does that tell you? You don’t have to become the next Bill Gates with your philanthropy. Even commiting $10-$20 a month towards generosity will have a huge impact on your happiness. 

Tobler goes on to claim that being generous is actually the primary route to boosting one’s happiness.

So not only is being generous with your money a great way to help other people, but it’ll also have a huge impact on your own overall happiness and well being.

Yet another win-win situation! 

Spending money more wisely doesn’t have to be complicated, but it is something you’ll have to work at.

The bottom line is that you want to spend your money on things that add value to your life, while at the same time not over spending for things that don’t.

My first suggestion would be to make a budget and set up an investment account. That’s a solid foundation to start from.

From there, you need to pay for your basic living necessities, and then with whatever you have left over, spend it wisely (maximize happiness). 

Not only will spending money more wisely put you in a better position financially, but if you follow some of these tips I discussed above, it should also improve your overall well-being. 

Dare I say…Win Win!

Noel is the founder and main contributor for his blog - Noel's passion for personal finance has helped him amass over 600k readers to his Financial Geek blog.

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8 tips for spending time wisely, the idea behind the expression "time is money.".

Posted April 6, 2020

Time and money are arguably life’s most valuable resources. One of the great laws of economics is that time equals money. What really matters is to spend it wisely. In fact, you can spend no money but your time as a gift, such as time spent with family.

The phrase "time is money" is usually credited to Benjamin Franklin, who used it in an essay ( Advice to a Young Tradesman , 1748). It means time is a valuable resource. He encouraged people to treat time like money. However, most people think about time and money in vastly different ways.

1. Time is our most scarce resource. Time is the ultimate scarce resource, yet we act as if we have unlimited time. Poor or rich, we all have 24 hours a day, 7 days a week. Thus, each of us faces the choice of how to spend our time. In a world of scarcity, choosing one thing means not being able to do something else.

2. The price of convenience. In economics, price is a much broader concept. Price includes not only the monetary cost of purchasing a product but also the time associated with buying that product. For example, overnight delivery, and convenience stores all charge premiums because of the inherent value we place on our time.

3. The value of time varies from person to person. Time is relatively scarce for people with higher incomes, partly because their time is more valuable. So, to have lots of time, rich people hire other people to do their, say, household chores. On the other hand, a nonworking person may spend more time on household chores.

4. The value of time in good economic times. The value of time is higher during good economic times. Evidence shows that people tend not to take care of themselves in boom times (Ruhm, 2007). For example, a 1 percent decrease in the unemployment rate corresponds to an additional 3,900 deaths in the United States in a given year. People tend to drink too much, eat out often, exercise less, and skip medical check-ups because of work-related time commitments. So people work more and do less of the things that are good for them. On the other hand, in bad economic times health-enhancing activities such as exercise and social interactions increase.

5. Price of delay. People are not equally patient. Some like the present, others like the future. A myopic person ranks immediate pleasure much higher than valuable delayed rewards. For example, social media is immediately available, and it is the cheapest way of avoiding boredom . In contrast, reading and conversation are demanding in terms of effort and motivation .

6. Cultural attitude toward time. Attitudes toward time and its value differ across cultures (Levine, 1997). For example, being late for an appointment, or taking a long time to get down to business, is the accepted norm in most Middle Eastern and some Asian counties. People in bigger cities walk faster than their counterparts in smaller cities. And while in a grocery store, they spent less time chatting with clerks and other shoppers.

7. Time cannot be stored. One of the reasons we give little thought about how we use our limited resources is that we cannot save time. Time moves on whether we choose to spend it or not. You can’t bottle time and exchange it for an object or event. However, when people are made aware of their mortality they wonder if they did make the most of their lives.

8. Buying time to promote happiness . What you do with your time also matters for your day-to-day moods. You can improve your happiness by putting your money where you spend most of your time (Whillans et al., 2017). For example, buying a new pillow or a nice bed could help you to get a good night’s rest. You can also outsource “disliked” tasks. This can allow you to maximize the time you get to do the things you love (e.g., cooking) and minimize the time you have to spend doing what you hate (e.g., gift-wrapping, housecleaning).

In sum, time is anything but free. As a nonrenewable resource, time is quite expensive. Some people fail to realize that time is scarce, hence oblivious about its opportunity cost. They do their best to think of their time as unlimited, and unlimited goods have little value. Knowing that time is finite encourages us to ask how we are using our time. Do we want to spend these precious moments on social media or spend that time learning something new? Skills and knowledge take time so the more time you spend on them, the more you improve.

Levine, R. V. (2020). Time and culture. In R. Biswas-Diener & E. Diener (Eds), Noba textbook series: Psychology. Champaign, IL: DEF publishers.

Ruhm CJ. (2007) A healthy economy can break your heart. Demography. Nov;44(4):829-48.

Whillans, A. V., Weidman, A. C., & Dunn, E. W. (2016). Valuing time over money is associated with greater happiness. Social Psychological and Personality Science, 7(3), 213-222.

Shahram Heshmat, Ph.D., is an associate professor emeritus of health economics of addiction at the University of Illinois at Springfield.

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How I Spent My Pocket Money (Essay Sample)

Table of Contents

Introduction

If you had your own pocket money, how would you spend it?

This essay focuses on how to spend money, and how to do so wisely. In this piece, we share a person’s experience of being taught to spend money wisely and what he would buy when he was given a regular allowance.

Writing an essay on what you would spend your money on? We can help. Go to EssayBasics.com to learn more about our essay writing services . We can help you express yourself by pairing you with a writer who has some experience in your chosen topic.

How I Spend My Money essay

One of the most exciting events in a young one’s life is when their parents give them an allowance. No matter the amount, an allowance gives us the opportunity to spend on small things that make us happy as a child.

The joy that an allowance brings is more than just the amount itself. It’s really rooted in the experience one gets in choosing how to spend it. First, there’s the anticipation of receiving an allowance. Next, there’s the excitement of thinking about all the things you’ve been wanting to get for yourself. Third, there’s the delight of actually receiving the allowance. Finally, there’s the sheer thrill of choosing what to buy and taking it home.

How and when an allowance is given, and how much is gifted to the child, depends on the guardians’ principles. There are those who provide an allowance for children to buy basic needs. But there are some who might give a little extra to give the child an opportunity to learn how to handle money well.

It must be said that not all children are privileged to have an allowance to spend on themselves. If they come from a poor family, the guardians may not have any extra finances to give. They may save up for this just once in a while.

I am very blessed that my parents gave me an allowance on a regular basis. My allowance has really taught me financial stewardship at a very young age. They also allowed me to make decisions regarding my finances, even if I made mistakes.

Saving Money at a Young Age

While my allowance isn’t a fixed amount, I have since learned that the first thing I should do is set aside a portion of it for savings. I get a third of whatever amount I get and earmark it for saving.

To make sure that I won’t be tempted to use it, my mom helped me open a bank account where I deposit the money. They opened a time deposit account, which means I cannot just withdraw from it anytime. Whenever I hesitated to go to the bank, my dad would remind me that my small deposits would turn into one big bulk of cash that could someday be used for a rainy day, or for strategic investments.

How I Spend Money with Whatever is Left

With what’s left of my allowance, I usually buy books. These are mainly documentary magazines, which I read during my leisure time. It is actually one of my hobbies. I have made it a personal tradition to always purchase a documentary magazine each time I get my regular allowance. I particularly enjoy news magazines and feature magazines. I am a lover of general knowledge. I love knowing about everything, how and why things are the way they are – whether about nature, politics, science, or geography. It is always a first on my list of hobbies.

The other bit of my regular allowance goes towards the purchase of snacks. I love yogurt and ice cream. The refrigerator at home always has a shelf specifically reserved for my yogurts.

The remainder of my allowance goes towards others. These include my family and friends. I try to buy them something nice as a way of thanking them for taking good care of me.

I also go out of the way to purchase some gifts for my siblings as well as my parents. I want to gift them with simple things, even if they were the ones who gave me my allowance. Doing this for them gives me so much satisfaction since I love making them happy. After all, what is life without happy family and friends?

Regular allowances taught me how to make wise spending decisions. I know how to handle and spend my cash, whatever amount it might be. Therefore, I am confident that when I start handling larger amounts of money in the future, I won’t be as overwhelmed. I will make it a point to remember the financial lessons I’ve learned as a child. I hope to also be able to teach others who to use their money wisely.

Short Essay About What You Would Spend Your Money On

Did you grow up being taught about the value of saving money? If you were like me, your mom and dad probably gave you a regular allowance. They also probably gave you free rein to use your money in whatever way.

Growing up, I deposited regular amounts into my savings account the moment my allowance was handed to me. I did not want to be tempted to splurge on all the food I was craving for while holding all of my money. Personally, apart from fast food, I enjoyed treating myself to books. In fact, I made it a regular tradition to purchase a book every time I got my allowance.

I remember being taught how to make a personal budget out of my allowance. Exactly how much money was given to me didn’t matter as much as the main principle they passed on: save money. They didn’t care if I used the rest of my allowance on junk food or other types of impulse buying. All that mattered to them was whether or not I set aside a portion to put in a savings account. And so I did.

How To Write An Essay About Money

There are so many ways to write a piece about finances. It depends on the lens you are viewing the topic from. Are you an adult looking back at your childhood and remembering important lessons learned? Are you a financial expert looking to give some advice on how to maximize your cash? Are you a student wanting to teach people how to set aside an amount in case of an emergency? Are you a parent who discovered creative hacks in your finances to make ends meet? Find your angle and work it.

How To Spend Money Wisely As A Teenager

When you are young and still living under your guardians’ roof, thinking about contingencies or other things you may be needing to buy before your next allowance comes may not come naturally to you. It is so important to learn how to handle your personal finances even at that age because that sets the direction of your spending in the future. When you start getting a monthly income, the weight of the responsibility is even greater as you start to live independently. Even as a teenager, learn to set financial goals and think of the long game. Even if you have to put money inside a piggy bank to avoid temptation, do so. Track your expenses and make adjustments according to your level of contentment. Learn the art of investing from an expert. Finally, don’t shop ’till you drop. It’s a trap.

Home » Teens

Spending for Teens

Learn how to spend your money wisely to budget, save, and still afford all the fun things you want.

Teen life is expensive. There’s shopping with friends, mini-golf with the cute new neighbor (who’s only a friend), and snacks after school. 

Before you know it, it all adds up! And if there’s one thing you know by now is that your parents aren’t made of money. If you had a penny for every time you’ve heard that one, spending wouldn’t be an issue! But it doesn’t have to be.

We’re not saying that it’s all gonna be OK, even if you splurge all your allowance on bubble tea. That’s not how it works. But if you figure out a way to stay organized and creative about how you spend, you’ll be able to stretch your dollars.

We’ll show you some useful tips and share some good ideas on how you can make your money last longer without spending all your Friday nights at home. And if you make smart spending a habit, you could end up pretty wealthy one day. But guess what? You’ll probably still tell your own kids that you’re not made of money.

Why Teens Need to Budget

Most people don’t like the word budget. As soon as they hear it, they cringe. In our book, though, that’s the quickest way to end up broke before the end of the week.

The sooner you learn how to budget your money, the better choices you’ll make in your financial life. Why? Because a budget helps you realize that some things are more important to you than others.

Let’s say your parents go out of town for the weekend and leave you with $100. But you need to make that money last for a few days. You’re probably not gonna run and spend it at the mall, right? That would be silly when you have great clothes in your closet.

A smarter way to spend that money would be on food and transportation. You’d probably also want to set some aside in case of an emergency.

That’s it! You just learned how to budget. It’s all about deciding what matters most to you and how much you want to spend on those things. As you can see, budgeting isn’t that difficult. The tough part, TBH, is sticking to the plan.

How to Develop Smart Spending Habits

The road to financial success can feel long. And there are a lot of detours along the way. But there are also lots of hacks to make it easier. These are a few of our favorite tips to help you learn how to manage your money while you’re still young.

Set Meaningful Goals

The most important part of budgeting is figuring out what’s important to you. Once you’ve decided what matters most, it’s easy to choose how much you’ll spend on things.

For example, if you want to buy a car by the time you’re 16 (and your parents are OK with that), you need to start saving. So, next time your friend wants to hit the bowling alley, you may decide to pass. It’s not that you don’t wanna hang. It’s that those $50 could get you that much closer to your new wheels.

Make Compromises

Having a budget doesn’t mean that you’ll pass on all the fun. It just means that you have to get creative. 

Instead of meeting your friends at the pizza shop and then hitting the movie theater, you might wanna invite them over to your place. You can grab some frozen pizzas at the grocery store and stream a movie on Netflix. It’s just as fun and way cheaper.

Reward Yourself

It might seem contradictory, but focusing too much on your budget can also backfire. At times, it can start to feel like a chore. And nobody likes that feeling.

To keep yourself motivated, try rewarding yourself now and then. You can even plan ahead of time and work it into your budget, so you have something to look forward to. Need some ideas on how to treat yourself without breaking the bank? Check these out:

• Have a picnic at the park. Get some yummy snacks and meet up with your friends for some fun lawn games.
• Buy yourself a special treat. Decide how much you want to spend ahead of time and challenge yourself to find something awesome without going over budget.
• Get a disposable camera and have a photo shoot with your pals.
• Hit the thrift store and find some cool vintage records to play at home.
• Get a new phone case. It’s a great way to feel like you have a new phone, for a fraction of the cost.

Experiment with Different Budgeting Methods

The great thing about being a teen is that you still don’t have many financial obligations. This freedom means that you can try different budgeting techniques and find the one that works for you. Once you’ve found a method that inspires you, it’s easier to feel excited about budgeting.

Some of the most popular budgeting systems include:

• Pay Yourself First : If you have a clear savings goal, this is a good one for you. It literally means you put money in your savings account before anything else. Then, you decide how you’ll spend the rest of your money.
• Zero-Based Budgeting : This one’s best for big spenders. If you plan how you’ll use every dollar in your account, you’ll be less tempted to spend on unimportant things. The great thing about this one is that you can include anything in your budget. As long as you plan ahead of time.
• 50/30/20 Rule : This strategy breaks your money up by percentages. The rule is that 50% of your income should cover your needs, 30% is for your wants, and 20% is for savings. Stick to the percentages and you’ll manage your money wisely.

This tip isn’t an excuse to spend more time on your phone. It’s using technology to keep track of your spending habits. There are lots of budgeting apps out there that help you do this.

Once you’ve monitored your spending for a couple of months, you can better understand where you’re slacking and where you’re doing well. This monitoring helps you adjust your budget and keep a close eye on the places where you need more discipline.

When you know how hard it is to earn money, you immediately become smarter about how you spend it. And these days, there are tons of ways for teens to make money .

With your parents’ permission, you can look for a summer or a part-time job near home. Many businesses hire teenagers and are willing to work around your schedule.

If that’s not an option, you can also find gigs or start your own business. Take a look at these ideas:

• Sell crafts or used clothes online
• Manage the social media account for a local business
• Babysit your younger family members
• Referee kids’ sports leagues
• Mow your neighbor’s lawn

The Role Your Parents Play in Spending Your Own Money

If you have questions about how to spend your money, you can always ask your parents. They may be able to help out or point you in the right direction. But, at the end of the day, you’re the one who’s responsible for your money.

The great news is that everybody messes up sometimes — even adults. If you blow your budget in one day, you have to learn from your mistakes. It’s part of learning how to spend responsibly.

Spending Lingo

Learning some basic terms will help you in your financial journey. These are some important words to understand if you want to get good at budgeting and smart about spending:

• Fixed Expenses : These are costs that don’t change from one month to the next. For example, your car payment or rent.
• Variable Expenses : Costs that aren’t always the same. Like your gas or your groceries.
• Opportunity Cost : What you give up when you choose something else. Buying something is always a trade off, because you could’ve used the money for something else. That next best choice is your opportunity cost.
• Financial Planning : Creating a plan for how you’ll spend and invest your money.

Best Books About Spending for Teens

Staying on top of your money is a great habit. With these books in your home library, you’ll learn more tips and become better at managing your money. If you want more book recommendations, check out our complete list of money books for teens .

Most Entertaining

The author of I Want More Pizza understands that one slice is never enough! In this easy-to-read book, you’ll get great lessons on how to budget your money and a solid understanding of how money works.

Not Just For Girls

Clever Girl Finance is more than just a book. It’s a whole platform that includes an excellent Insta account and fun TikTok videos packed with practical advice to manage your money and grow your wealth.

Comprehensive Money Guide

Go beyond budgeting basics with Smart Spending: The Teen’s Guide to Cash, Credit, and Life’s Costs . As the title suggests, it covers more than just managing money. This handy guide also talks about credit and what it costs to live life as an adult.

Learning how to manage your money now can save you many headaches as an adult. You should feel pretty proud of yourself for wanting to make good decisions and spend your money wisely. If you keep up the good habits, this could be the start of an extraordinary financial journey!

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Essay on Money for Students and Children

500+ words essay on money.

Money is an essential need to survive in the world. In today’s world, almost everything is possible with money. Moreover, you can fulfill any of your dreams by spending money. As a result, people work hard to earn it. Our parents work hard to fulfill our dreams .

Furthermore various businessmen , entrepreneurs have startup businesses to earn profits. They have made use of their skills and intelligence in getting an upper hand in earning. Also, the employee sector works day and night to complete their tasks given to them. But still, there are many people who take shortcuts to success and get involved in corruption.

Black Money

Black money is the money that people earn with corruption . For your information corruption involves the misuse of the power of high posts. For instance, it involves taking bribes, extra money for free services, etc. Corruption is the main cause of the lack of proper growth of the country .

Moreover, money that people having authority earns misusing their powers is black money. Furthermore, these earnings do not have proper documentation. As a result, the people who earn this do not pay income tax . Which is a great offense and the person who does this can be behind bars.

Money Laundering

In simple terms, money laundering is converting black money into white money. Also, this is another illegal offense. Furthermore, money laundering also encourages various crimes. Because it is the only way criminal can use their money from illegal sources. Money laundering is a crime, and the people who practice it are liable to go to jail.

Therefore the Government is taking various preventive measures to abolish money laundering. The government is linking bank accounts to AADHAR Card. To get all the transaction detail of each bank account. As a result, the government comes to know if any transaction is from an illegal source .

Also, every bank account has its own KYC (Know your Customer) this separates different categories of income of people. Businessmen are in the high-risk category. Then comes the people who are on a high post they are in the medium-risk category. Further, the last category is of the Employee sector they are at the lowest risk.

Get the huge list of more than 500 Essay Topics and Ideas

White Money

White money is the money that people earn through legal sources. Moreover, it is the money on which the people have already paid the tax. The employee sector of any company always has white money income.

Because the tax is already levied on their income. Therefore the safest way to earn money is in the employment sector. But your income will be limited here. As a result, many people take a different path and choose entrepreneurship. This helps them in starting their own company and make profitable incomes .

Every person in this world works hard to earn money. People try different methods and set of skills to increase their incomes. But it is always not about earning money, it’s about saving and spending it. People should spend money wisely. Moreover, things should always be bought by judging their worth. Because money is not precious but the efforts you make for it are.

Q1. What is Black Money?

A1. Black money is the money that people earn through illegal ways. It is strictly prohibited in our country. And the people who have it can go to jail.

Q2. What is the difference between Black money and White money?

A2. The difference between black money and white money is, Black money comes from illegal earnings. But white money comes from legal sources with taxation levied on it.

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How To Spend Money Wisely Essay Example

• Pages: 6 (1392 words)
• Published: July 21, 2016
• Type: Essay

Do you hate it when you really need money, but your wallet is empty? No matter how little or how much money you have, spending it wisely is a good idea. But how do you spend money wisely? People actually tend to overspend in a few specific areas. So,following the steps below will improve your overall pocketbook health. First, come up with a budget. Financial experts suggest you track your spending for a few months so that you start work on your budget knowing where your money is going. If you are bad about saving receipts for cash purchases, keep a notebook with you, to write down all cash purchases as you make them.

Additionally, make a list of your monthly expenses, using your bills and the information you gather. Review this list

to determine where you can reduce expenses and by how much. Therefore, avoid impulse buying. Before making any purchase, ask yourself a few simple questions, and be honest with your answers. Only move on to the next question if you can answer yes to the current one. If you cannot get all the way through the questions, it is probably an impulse buy and you should pass it up. You should think about the things in your life that you tend to spend the most money on.

Most of these areas are outlined below, with suggestions as to how you can cut down on spending in them. Besides. shop around regularly for utilities and insurance. Many service providers count on customers sticking with the services simply because it is easier than shopping for another one regularly. If it

has been more than a year since you purchased your cell or home phone service, cable or satellite package, internet service, or car, home, or health insurance, shop around and make sure you are still getting the best deal. Moreover, Research large purchases before buying.

Never purchase anything that costs more than $200 without conducting some research first. The more expensive the item, the more research you will want to conduct. Your research should compare brands, prices, and quality so that you can determine which product is the best for you and your budget. Some reputable places to start your research include. Money doesn’t grow on trees. So, we must work hard to find money Managing your money wisely is one of the most important ways to gain a level of financial stability and independence.

Regardless of your income level, there are intelligent and manageable ways to spend money, and there are many ways that can leave you behind the eight ball and unable to pay the bills. If you’ve never had lessons on money management or have simply forgotten them over time, here are a few very simple steps you can take to put you and your bank account on the right track to financial stability and comfort for you and your family. 1. Don’t Spend it All It seems pretty simple, but spending less than you earn is an essential first step to stabilizing your situation and having something left over at the end of the month.

The easiest way to track this is on a monthly basis. Chances are you already know how much money you earn in a

month. Now get all your monthly bills you have to pay every month and add those up. After that, figure out how much money you spend on groceries, entertainment, and other day-to-day expenses throughout the month. Once you have it all added up, you’ll know if you’re saving money at the end of the month or ending up with a deficit. If you have a deficit at the end of the month, you are probably buying those extra items on a credit card with interest rates that will make you owe more money in the long run.

Stay away from a situation like that by being sure you spend less than you make every month. 2. Don’t Waste Money Having fun is important and everyone deserves to spend a little bit on entertainment and recreation every once in a while, but there are places in almost every budget where you can cut back without decreasing your quality of life. Take an honest look at what you spend your money on and find those things that are essential (mortgage, medical bills, insurance, rent, car insurance, etc. ). After that the most important thing is food.

That’s a little more complicated, because you have to buy food, but you probably don’t have to buy all the food you’re buying. See where you can cut out on junk food and other things you don’t need. Cook at home more often and eat out less. Use generic brand name products rather than popular brand names. All of this will save you money in the long run. If there are other places in your entertainment budget that you

can cut costs, do it. 3. Start Saving Early Once you’re able to put away some extra money at the end of the month, don’t spend it all at once on something. Instead, invest it in the future of your family and your own retirement.

If you put your money into a high yield savings account now it will end up paying off by a lot in the long run. How To Spend Your Money Wisely It is always important and necessary for you to understand your personal finances. Whether you like it or not, being able to learn more about your money makes you more confident in the decisions that you make in the future. When you understand these tips, your financial situation will improve. Build a budget based on your monthly income and costs. A budget is a tool to help you plan, prioritize, and manage your income and expenses.

Review your budget often and update it when you are experiencing a change in income and expenses. The key to building an effective budget is knowing exactly how much money your family earns every month. Everything you spend money on should be accounted for. Never spend more money than you have available. Take the time to record your expenses. Making a list of expenditures can help you to visualize where all of the money goes. Don't overlook expenses that don't occur monthly but are paid quarterly or twice a year. Add surprise expenses to your list, such as emergency or repair costs.

You should also include leisure and entertainment expenses on your list. Doing all of this will ensure that

you have an accurate portrayal of your expenses. Once you have established a detailed record of your household cash flow, you can create a feasible budget. Eliminate things from your budget that are not necessary. You can keep a lot of money in your pocket if you stop buying your coffee at a coffee shop or buying your lunch. Upgrades and improvements to your house can save money on your utility bills. Consider getting new appliances, like efficient washing machines or dishwashers, that use less water.

When it comes to delivering hot water, tank heaters are less efficient than on-demand or inline heaters. You should have the pipes in your home checked in order to find any leaks that may be costing you extra on your water bill. You may want to think about upgrading appliances with energy smart ones. Appliances that have circuitry that regulates their energy use save a lot of money over time. You should also unplug unused electrical devices when they are not in use. In the long run, things with the indicator lights can use quite a bit of electricity.

Another project that you can undertake is to increase insulation. You can do this by improving your walls, ceiling, and roof. You will find that your home will be able to store more heat, which can save money. This might take a lot of time, but the money saved is worth it. Although some of these suggestions may bring with them significant investments, it is still certain that they will be of worth in the long run. The money you spent on the initial invest will quickly be

returned to you in the form of lower bills. Over time, you will have a lot more money and financial freedom.

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Getting Started With Savings

The earlier you begin trying to save, the easier you’ll make things for your future self.

By Tara Siegel Bernard

Financial Boot Camp for 20-Somethings: Day 5 of 5

It’s time to get your money in order.

When you’re in your 20s, retirement seems so abstract, it might as well be thousands of years away.

Maybe it feels something like that to you right now. Why save for something so many decades in the future, when every last dollar is accounted for in the here and now? Saving for anything at all, in fact, may feel impossible.

But what if you just laid the groundwork so that it became easier to save a little something? That’s what we’re going to work on today.

Getting started early for retirement is smart for the same reasons you may want to put it off: Time is on your side. If you set aside what you can now, the magic of compounding numbers — when you begin to earn interest on interest — can do more of the heavy lifting over time.

In other words, saving early may result in having to save less over the long haul, which will take some pressure off as you’re juggling other demands that inevitably arise. Maybe those demands will be children and all the money they manage to siphon up , or perhaps you’ll need some time off to care for an aging parent .

And (mostly) nobody wants to work forever — the earlier you start saving, the sooner you can stop working and dedicate more time to what’s meaningful to you.

The easiest way to save — for everything, really — is automating. When you have money automatically and regularly shuttled to its destination, you don’t have to remember to do anything. That goes for purely pleasurable financial goals as well, like saving for a big trip.

It’s empowering, and will bring you closer to the things that make you both happier and more financially secure. It will take some time and patience — but your future self will thank you.

Before you get started, you need to figure out how much you have to work with.

Deal with debt. Before you begin saving, make sure you have a plan to knock out any high-cost debt, like debt on credit cards, where interest rates (around 22 percent) far exceed the money you might earn when investing your savings in the stock market over time (7 to 8 percent).

Get organized. Get a copy of your pay stub or check your direct deposit to get a sense of your take-home pay. (Freelancers should calculate their average monthly income.) Then write down all of your expenses — rent, all insurance not already deducted from your paycheck, utilities, groceries, transportation costs, car payments, mobile phone, student loans and any other debts.

How much is left over? Something? Congratulations! You have some room to save. Cutting it close? Is there anything you can pare back a bit to make space for some savings?

Build a Buffer. Creating a financial cushion — in the form of an emergency savings fund — can help you avoid turning to credit cards if you suddenly lose your job or hit a financial pothole, like covering a $1,000 car repair.

Financial planners suggest keeping three to six months of your expenses in emergency savings (stowed in a high-yield online savings account, which offer the best rates). That may seem like a lofty goal when you’re living on a starting salary that barely covers your bills. So start small , even if it’s saving $50 a month — $83 a month will get you to $1,000 in a year — and add more if and when you can afford it. Set up an automated plan that sweeps that amount from your checking account to your savings account. Then, don’t touch that money.

Saving for Retirement

Many people with student loan debt often wonder if they should focus on paying down those loans before saving for retirement. The short answer: Probably not. (If you’re really struggling to pay your federal student loans, check out the income-driven repayment plans I mentioned yesterday. )

But there’s a strong case to be made to both invest and pay down your loans simultaneously , if you can.

The illustration below practically screams why. Can you see how much you’re likely to give up by focusing solely on paying off loans for 10 years?

If you have access to a 401(k) or a similar workplace retirement savings plan, you’re in luck — only 69 percent of private-sector workers do.

You may have already heard that some plans come with a nice little perk: free money. Employers may provide matching contributions when you save; for example, they might match every dollar you contribute up to 4 percent of your salary.

That means you’re effectively contributing 8 percent of your income, which is pretty close to the 10 percent that experts recommend (they often recommend saving more, up to 20 percent, but 10 percent is a great start — consider ratcheting it up one percentage point each year as you get raises).

What if you don’t have a workplace retirement savings plan?

Roth individual retirement accounts (or Roth I.R.A.s ) are often the right choice for younger people (though they are subject to income and contribution limits ). That’s because you’re depositing money that has already been taxed, and you’re probably in a lower tax bracket now than you will be later in life, when you’re likely to be earning more.

Compare that with the traditional I.R.A ., which provides you with a tax deduction now, but you pay income taxes when the money is withdrawn. That means your Roth I.R.A. balance is what you’ll have to spend, whereas traditional I.R.A. balances will be reduced by the amount of tax you will owe later.

How should you invest your money? The short answer: A diversified mix of index funds . These are inexpensive mutual funds that track broad spheres of the stock and bond markets (exchange-traded funds, which are like mutual funds but trade in an exchange, are a similar option). For more details on your investment options, check out this guide .

More immediate spending goals

Besides retirement, you surely have other savings goals. Maybe you’re saving for a car, a wedding party or a special trip. Since these goals have a shorter time horizon than retirement, or something you’ll need to access within three years or less, you’ll want to take less risk with this money. The easiest strategy is to automatically transfer money into a high-yield online savings account, say, monthly. With short-term goals, the amount you save is far more important than your return.

But if you need the money in three to 10 years — call that a medium-term goal — you may have more options, depending on how flexible you can be with your timing.

It may be tempting to invest your savings in the stock market, for example, in hopes of generating a higher investment return. But that comes with more risk. As one financial planner wisely put it: You have to consider how it might feel to lose half of your stock investment in any given year, which can take some time, even years, to recover. Do you have the time (or the stomach) for that?

You can take a hybrid approach and invest in a mutual fund that has a mix of 60 percent bonds and 40 percent stocks, for example, or there may be bond investments to explore that provide more stability (though they carry risks of their own ). But tread carefully.

Even if you don’t have large amounts to save now, setting up the infrastructure to save is the hardest part — and as your earnings increase, it will be much easier to save and invest more.

Action items:

Do you have a high-yield online savings account ? Some banks, including Ally and Capital One, let you set up different savings buckets for specific goals, which you can label (emergency funds, vacation, down payment). DepositAccounts.com has a helpful guide to help you sort through options.

If you have a workplace retirement plan and haven’t thoroughly inspected the investment options , set a reminder in your phone’s calendar to check. What index fund options do they have on offer? Also familiarize yourself with any target-date fund offerings. (These are a ready-made mix of investments that you can select and then forget about and are a blend of stock and bond mutual funds that gradually and automatically become more conservative as you approach the year you expect to retire. If you were born in 2000, the 2065 or 2070 funds may be the right fit for your situation.)

If you don’t have access to a workplace retirement plan, familiarize yourself with roboadvisers , or companies that lean heavily on technology to manage your investments but also often have human financial advisers. These are nice options for people with simple needs, or who have a savings and investment plan they want to establish and run on autopilot. Morningstar ranked its top picks here.

Have a question about money?

Ask us here .

Did you miss Day 1? Catch up here. Day 2 is here , Day 3 is here , and Day 4 is here .

Tara Siegel Bernard writes about personal finance, from saving for college to paying for retirement and everything in between. More about Tara Siegel Bernard

A Guide to Making Better Financial Moves

Making sense of your finances can be complicated. the tips below can help..

Inheriting money after the death of a loved one while also grieving can be an emotional minefield, particularly for younger adults. Experts share ways to handle it wisely .

Either by choice or because they are priced out of the market, many people plan to never stop renting. Building wealth without home equity  requires a different mind-set.

You may feel richer as you pay your mortgage down and home values go up. As a result, some homeowners end up with a lot of home equity but low retirement savings. Here’s the problem  with that situation.

Can your investment portfolio reflect your values? If you want it to, it is becoming easier with each passing year .

The way advisers handle your retirement money is about to change: More investment professionals will be required to act in their customers’ best interest  when providing advice about their retirement money.

The I.R.S. estimates that 940,000 people who didn’t file their tax returns  in 2020 are due back money. The deadline for filing to get it is May 17.

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Teenagers on Spending Money 3 Pages 681 Words

            Do young people spend their money wisely?.              Today young people spend their money foolishly because of circumstances and pressure from friends and other young people. No matter how much money young people have, they often use that money on shopping. This is very normal today because living a young life is very expensive.              For example, we need money to buy clothes and in high school or college young people often wear expensive clothes which have great style and name brands: Tommy Hilfiger, Nike, Reebok, Fubu, etc. There"s always competition in styles and young people tend to keep up with the fashion trend. There are many reasons why young people dress in clothes that are very expensive, stylish. Boys dress nicely to attract attention. They want to be like a celebrity so fashion is an issue. The same goes for girls, but there is competition against the same sex. For example, one girl wants to dress better than others.              Looks are also an issue. Young people spend most of their money on themselves buying beauty products and for personal reasons. For example boys need haircuts and groom themselves very neatly so that their hair looks attractive. But girls not only spend their money on hair, but also on makeup, shoes, nails and facials.              Money is also spent on other personal products like cars, magazines, educational supplies, and entertainment. Especially teenagers in schools always want the best looking cars. By having the best looking cars makes the owners popular. Girls mostly spend money on magazine subscriptions such as seventeen, vogue, etc., mostly to check out the latest fashion clothing, shoes, and news on celebrities like those boy-band and young actors. On the other hand boys buy magazines especially on cars and games. Also today young people also wants the best educational supplies there is like backpacks which have a famous name brand on it, pens and pencils that are very stylish, calculators and all these supplies should be the best of the best and high tech.

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Your Bank Account This Week, According To A Tarot Reader

Spend wisely and you shall be rewarded.

Jumping back into work after a long weekend is never easy, but this week’s money tarot reading gives you a lot to be hopeful about. Spend wisely and you shall be rewarded! Plus, with mental planet Mercury and innovative Uranus coming together midweek, you might have some unexpectedly brilliant ideas or creative breakthroughs on the astrological front, too.

I pulled three tarot cards to help guide you through any finance or work-related issues this week, so read on to get the scoop.

Card 1: What do you need to know about your finances this week?

When it comes to financial security, the King of Pentacles is at the top of the food chain. Pentacles is the tarot suit that symbolizes wealth, material resources, and career success, and the kings are as powerful as it gets. This card is about having an abundance of resources and feeling totally secure and immovable in your success.

So what do you need to know about your finances this week? It’s time to step into a King of Pentacles mindset. Have confidence in your ability to make smart money decisions and be pragmatic about approaching your goals. You’re in it for the long haul, so get-rich-quick schemes or high-risk financial ventures are not the move right now. Instead, focus on being methodical, diligent, and playing it safe. This card wants you to set yourself up for success in the future instead of living for the moment, so don’t blow a paycheck on anything you don’t need or can’t truly afford. Making responsible financial choices this week will pay off.

You don’t have to be born into royalty to have a comfortable financial future ahead of you. Being conservative with your cash, making practical career moves, and slowly building wealth over time can also get you where you want to be. Plan like a true provider this week, even if the only person you’re providing for is your future self.

Card 2: How can you feel less anxious about money?

The Six of Cups wants you to do some inner child healing to feel less anxious about money this week. This sweet and nostalgic card inspires you to look at the past and tap into the freedom and playfulness of an idyllic childhood.

Maybe that means calming your nervous system by watching your favorite 90s cartoons or scrolling through nostalgic TikToks to admire the dreamy pastel Polly Pocket houses from your youth. It’s easier to make smart decisions when you’re not in a state of panic! It may also mean it’s time to start unpacking any painful memories you’re still carrying that relate to money or financial security from your past. Remind yourself that you’re empowered to make your own choices and in charge of your own financial situation now, unlike your childhood self.

The Six of Cups also symbolizes the warmth and generous nature of family, so if you need to ask a relative for a favor relating to money, this could be a good week for that. This card also gives you a green light when it comes to circling back to a professional or financial opportunity from the past that might be more useful to you now than when it first came about. The door may still be open and you’re likely still remembered fondly, even if a lot of time has passed. Instead of being hard on yourself for missing out, shoot your shot.

Card 3: What will impact your career this week?

Like the King of Pentacles, the Ace of Pentacles is another highly auspicious card for work and finances, so trust that the universe has good things in store this week. This card represents exciting opportunities in your professional life — and it’s your job to seize them.

The Ace of Pentacles could indicate a happy career surprise, like an unexpected pay raise, an important project you’re being put in charge of, or a sudden interview offer from someone in your extended network. Or it could mean something you’ve desired is finally being made available to you, such as the chance to apply for a higher position within your company or stumbling upon a relevant job listing in a field that you’ve been hoping to break into. If you’ve got big business ideas, now’s a good time to make a first move.

Even if a dream opportunity doesn’t materialize out of thin air, keep your eyes peeled for any potential opportunities you may have to make a good impression at work and otherwise put your talents on display. If you can step up on a project or throw your name in the ring for something lucrative, go for it — because whatever you jump into this week has the power to bring great material success.

Nina Kahn is Bustle's resident astrologer and tarot reader.