I manage my business and personal finances by one simple rule:
Reduce or eliminate fixed costs. Ignore variable costs.
If you're unfamiliar with the terms, fixed costs refer to the spending that happens every month regardless of how much you use it. Personal expenses like memberships, internet/phone bills, rent -- basically anything you've set to automatically take your money from you. Related business costs are salaries, rent, and fees you pay out each month.
The rest of life is made up of variable spending. Going to the movies, eating at a restaurant, buying a cup of coffee on the way into work. Basically, the things most financial advice people tase you for buying.
The thing is life's enjoyment comes from your variable costs, and their the easiest to adjust; however, if you've committed yourself in fixed costs you'll be suffering every month.
I firmly believe you can't focus on all of your spending. What ever you do, pick a simple rule and go.
Reduce or eliminate fixed costs. Ignore variable costs.
If you're unfamiliar with the terms, fixed costs refer to the spending that happens every month regardless of how much you use it. Personal expenses like memberships, internet/phone bills, rent -- basically anything you've set to automatically take your money from you. Related business costs are salaries, rent, and fees you pay out each month.
The rest of life is made up of variable spending. Going to the movies, eating at a restaurant, buying a cup of coffee on the way into work. Basically, the things most financial advice people tase you for buying.
The thing is life's enjoyment comes from your variable costs, and their the easiest to adjust; however, if you've committed yourself in fixed costs you'll be suffering every month.
I firmly believe you can't focus on all of your spending. What ever you do, pick a simple rule and go.
RSS Feed