Spend Earn Salary

There are many ways that one can stop spending more than he or she earns. It is not a wise idea to spend more money than one earns as this could lead to debt later in life and reduced earnings. An individual can be in a very high pay bracket, but at the end of the month if he or she spends all the money in his or her bank account in a lavish fashion being dependent on a monthly salary is a reality.

Here are a few tips to avoid spending more than you earn:

Draw up a monthly budget. Look at your gross and net earnings and subtract monthly expenses like rent, food and toiletries. Whatever money is left over after budgeting for expenses can be used for entertainment like going out to restaurants and watching a movie with friends. A portion of your earnings should also be saved.

Cut up all credit cards. Credit cards encourage irresponsible spending. Remember cash is king and can be your best friend in times of debt. People overspending their credit limitations is the number one reason of debt in so many first world countries. If you cannot afford to destroy your credit cards, but feel that you use it responsibly then pay your installments every month in full. One saves a lot of money that would be paid on interest in this way.

Take a careful look at your bank charges. If you feel that your bank is charging too much on fees then change to a lower banking option for look for alternative banks. Try to limit ATM withdrawals and examine bank statements every month. Always be vigilant and be careful of fraud.

Cancel that gym contract if you are not using it. There are also many other ‘white elephant accounts’ that one may have. These include having two or more cellphones or Internet contracts. The average person only needs one cellphone. Some people seem to have a blackberry, IPhone and Samsung. Having more than one phone means unnecessary expenditure.

Try to keep the same car for a number of years. Changing a car every year if you do not get a car allowance is not advisable. There is no need to keep up with the Joneses. This also applies to technological appliances.

Try to buy a property instead of renting. One may be paying someone else’s bond in the long run. It may be a better idea to buy a place and put more money into it every month than paying a monthly rental. It may be a big sacrifice in the beginning, but at least it will be a benefit in the long run.

These are just some ideas that can help an individual stop spending more money than he or she earns.