Tips for Saving Money [2]

How to write an effective household account book + Best apps

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Most people know about household account book. However, not many people prefer using it because they think writing an household account book could be waste of time or just not helpful for them. But, I think the most important thing in getting into the habit of writing an account book is that you can actually realize your pattern of money waste and learn from that. So, this time, I am going to talk about how to write an effective household account book.

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What are some of your fixed cost?

• When you are writing the account book, you should first know about the fixed costs which you paid daily, weekly, or monthly. By knowing your fixed costs, you can actually add them in the very beginning of the account book.
• Ex. rent, insurance, property taxes, etc.…

Write down your expenditures and rate the importance

• Now, you can write down the expenditures. While writing about the expenditures, you should include cost of product and type of product. After that, you should note the importance of the product that you bought. On a scale of 1 to 5, you can ask yourself, how important is the product, or how much are you satisfied with the product.

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Analyze the expenditure

• After rating the expenditures, now you should calculate the total expenditures of unimportant goods. If you are expenditures of unimportant goods take more than 30% of your total expenditures, then you should reduce wasting money on those. If you are spending less than 30%, then you are on the right track of saving your money.

If you follow these steps, you would be able to find a fixed cost, type of expenditures, and patterns of unimportant expenditures. And, this will make you practice saving your money.

Best apps

• AndroMoney
• Mint
• PocketGuard
• Google Sheets (download a template for account book)