Where Does Your Money Go?

Do you know where your money goes every moth? Many of us don’t, so let’s talk about Rachel.

Rachel is a busy woman; she is an executive with a regional company, she has two teenagers at home and is single. Her children are involved with sports and her son is part of a local drama company. Between her own work, and her children’s schedules, she has little time to manage her finances. Her bills are on auto pay, and she and the children frequently bring home dinner from their favorite local restaurants. She would really like to start her own business but doesn’t see how she will fund it. She has some money left over at the end of the month but doesn’t have a plan for systematic saving. She does contribute to her 401(k) but doesn’t remember how much she has going into it each month. She hasn’t looked at a statement from the account in some time. They are sent to her by email each quarter, but she rarely opens them. She doesn’t really know what she spends her money on each month beyond her fixed bills.

Rachel reached out to a financial planner that a friend uses and sat down to talk about these issues. As she talked about her goals for the future of starting a business and helping her children get launched into the world, it became apparent that she really didn’t know where she stood financially. The planner was able to help her figure out where she stood, and they developed a plan to track her spending for a couple of months to see exactly where her money was going each month.

At the end of that time, Rachel realized she had a lot of leakage in her monthly spending and she began to develop a plan to strategically place her money into places of her choosing to fund her plans. She has the beginnings of a strategy to make her goals come to fruition. It will take regular monitoring to ensure she stays on track, but she has a lot less stress in her life worrying about money.

In the coming blogs, we will get into more detail on this issue. In the meantime, think about the top 3 areas you spend your money on.

Investment advisory services offered through Equita Financial Network, Inc. (“Equita”). Equita also markets investment advisory services under the name Next Step Financial. The foregoing content reflects the opinions of the author(s) and is subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that the statements, opinions or forecasts provided herein will prove to be correct.  

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