Are you honest?

Due to the Jewish holidays I haven’t been posting as I would like I and where we should be moving on to week 6, we are only covering week 4.

Last post in the financial freedom series covered facing your money fears.  This week we look at being honest about your money.

You have analysed your memories and faced your fears. Now it is time to face reality!

Every month I draw a certain amount of cash to cover definite expenses. Before I used envelope budgeting, the money used to just disappear.  One day I would have R 1000 in my purse and the next I would have R 200. Where did it go?

Can you trace it? If you read my posts http://kasheringyourlife.co.za/index.php/2015/08/16/auditing-your-budget/ and http://kasheringyourlife.co.za/index.php/2015/08/23/can-you-keep-track/ then you should be on the way to keeping track of all this money.

Banking institutions and retail shops are making it easier for us to lose touch with our money, through store cards, credit cards, debit cards, internet banking, even e-wallets. Yes, it has made life easier but it has made budgeting harder.

It is time to find out how in touch you are with your money, especially if you haven’t audited your budget yet.

This step takes a bit of time. Take some paper and sit down and work out your average monthly costs. Everything you spend your money on.  Don’t use your statements or anything else.  This is just what you think you are spending.

Now it is time to see how in touch you are. Most people will come up with a figure close to their salary. The reality is that you have either over, or under, estimated your spending by between 5% -10%!

Here are some of the things I forgot to include the first time I did this:-

Annual memberships; for my husband and myself who have professional fees that allow us to practice in our professions. Do you belong to a professional organisation that requires annual fees? How about your TV license?

Did you count your disposable contact lenses?

Where did you put the levies from the pharmacy? What about Doctors visits when you are in your self -payment gap?

Did you count your annual holiday and what about religious holidays, or even the tithe that you give weekly?

Do you give money to the car guard?

Does your dog get groomed, weekly or monthly?

If your kids go on youth camps you will have to pay for it – did you break it down and put it in your budget?

If you have pets, did you put in your vet bills?

I have four children, all of whom, up until recently, needed birthday parties every year.  Then there are there friends whose parties they attend who need catering and gifts.  Did you count this into your budget?

For the Jewish community who have 19 days of Jewish holidays to pay for and, if you are not Jewish, just remember it is almost December!

Did you count in school stationary, magazines or newspaper subscriptions as well as your cosmetics?

I could carry on forever with a list of things that need to be added to your budget!

Your homework for this week, should you chose to do it, is to sit down with your bank statements, bills and everything else you can find for as far back as the last five years, if you have it, and work out your ACTUAL monthly expenses, versus your income.

Good luck!