For starters, ever since I was about 14-15 years old, I keep track of EVERY bit of money that comes in or goes out.
First of course, this only had to do with the small time stuff you do as a kid, but I have kept it up and I am still doing it today. Nowadays, I don't have to write it down anymore, it just goes into the computer.
After some practice it becomes quite natural to know what you have spend each day.
In addition to this, since one year, I keep also a net track of this based on calendar day. So, every day, I note how much comes in and how much I spend.
And then, of course, the trick is to do it in such a way that every month has a positive balance.
All of this does not in itself tell me what to do or not do with my money. But over the years it has given me a very good insight on where my money goes and where it comes from. It has become a habbit to make a definite decision about whether I will or will not buy or do something. That may sound like I turn over every dime (which I do not), but it DOES have made a difference in HOW I will spend my money.
For example, when filling up the car, I know where not to buy gas.
Also, I will almost never buy a softdrink at a filling station or somewhere else because, usually, they price is about 2x-4x time of what you would pay in the supermarket.
Same goes for buying daily groceries and stuff, or going out for lunch.
You might be surprised on how much money easily goes into buying lunch every day at work on a yearly basis.
Most important, I pay for most things in cash because have to hand over the money gives you a better idea of how much you spend.
And I practically do NOT use credit anywhere. Apart from my house mortgage, everything else I have (not much, I have to admit
) has been paid for with my own money.
