I spent $142,987 last year.
I just did a 2018 personal financial recap (you should do one too!) and I spent well over 6 figures last year. That dollar amount includes living expenses, investment acquisitions, mortgages, business startup costs, EVERYTHING. And really....that number doesn't shock me at all.
Because I TRACK every penny that comes in and out of my accounts. I know EXACTLY where my money is going.
And by TRACK, I mean....
I use Personal Capital (affiliate link) to automatically track my financial life.
I don't have time to labor over spreadsheets, bank account statements, and credit card bills. And you probably don't either. The good thing is, Personal Capital links my accounts and does everything for me :)
By logging on, I was able to determine within 20 seconds that:
I spent $3,164 on Restaurants in 2018
I spent $940.23 on my cell phone in 2018
I spent $1,182 on groceries in 2018
Understanding these types of trends, and making adjustments is key to a healthy and successful future. Having these types of insights can exponentially increase your wealth.
*Bonus Tip* After identifying my spending trends, I leveraged that knowledge and picked up a new credit card that rewards me for my highest expense categories. If you spend a lot on restaurants and groceries like I do, check out the new American Express Gold Card. You'll get 4x points on those categories and 40,000 points by using my referral link.
I started tracking my finances in detail a couple years ago, and it's literally been a LIFE CHANGER.
Just a couple years ago I was making $44,000 a year living in the San Francisco Bay Area. I knew that if I wanted to improve my financial situation, I had to understand my finances first. There's no coincidence that my income has more than doubled since I started educating myself and tracking everything.
Before you Jump In to real estate, build that financial foundation! Educate yourself on your income, spending habits, and investments.
Now, the cool thing is, not only does Personal Capital track your income and expenses, it also tracks Net Worth. Every couple weeks I check my Net Worth and it's been a game changer in building wealth.
What exactly is Net Worth?
Simplistically, it's your Assets minus Liabilities. It provides a snapshot of your financial situation in real time.
Why is it important to track Net Worth?
When you see your financial trends right in front of you, you're forced to confront the realities of where you stand financially. Knowing that, will cause you to be more mindful of your financial activities.
Coincidentally, I just got this email from CNBC the other day...
Glad to see that CNBC and I are on the same page :)
If you don't keep track and understand your finances, you're ignoring them. You can't expect to improve your financial situation and grow your wealth if you don't have knowledge over your own finances.
So, if you're the type of person that HATES talking about money...
Or, you refuse to confront your bank account...
Or, you need to step up your finance game...
Or, you want to grow your wealth...
The first step is to make a change and educate yourself in your own finances. Take charge. And face it now!
Check out Personal Capital (affiliate link) because I HIGHLY RECOMMEND IT! And if you sign up using my affiliate link, you'll get a $20 Amazon Gift Card.
And Happy Investing!