This is an obvious one. Knowing what is going into your account and what’s coming out is essential. You must make sure to consistently check your account statements. This not only allows you to ensure there have not been any fraudulent charges, but it also helps you see what areas you are spending the most in. Once you have an idea for where you were spending the most money throughout the month, you can determine areas where you can cut back on your spending, and perhaps also place that money somewhere more productive.
Tracking your expenses can be made easier if you categorise them by type of expense. You can do this in one of the many apps that exist or even just in a simple spreadsheet. Often, laying out all of your expenses in front of you helps to materialise the money. Because of digital banking, it can be difficult to think of money as a tangible thing—especially since cash is so rarely used nowadays. By categorising your expenses (e.g., takeaways, bills, shopping, etc.), your money will not be such an abstract concept anymore. In fact, you may have the sobering realisation that you are spending far too much on your daily morning coffees (or the equivalent).
Once you have done this, you can make more productive money decisions. For example, if you want to spend less on going out to eat and put that money towards a big-ticket expense, you can calculate the amount of time it will take to do this.
