“How to Avoid Unnecessary Expenses”
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After reading Chapter 1 and watching the videos- “How to Avoid Unnecessary Expenses” and “You’re Spending Too Much” and evaluating your current style of managing your finances:
Review your expenses and identify three flexible expenses that you could reduce or eliminate altogether. Discuss how you can reduce or eliminate these expenses.
How much do you normally spend on eating outside during the workweek? Using your daily expenditure on eating out, calculate how much you normally spend during a year and over the course of 10 years. What do you think of your findings?
Sample Solution
One flexible expense that I could reduce or eliminate altogether is eating out. Eating out can be an expensive habit and it’s a luxury that I can easily do without. To reduce this expense, I plan to make all of my meals at home using grocery store items that are on sale and within my budget. Additionally, I will focus on meal planning and creating a weekly menu to help me stay organized while also saving money.
Another flexible expense that I could reduce or eliminate is transportation-related expenses such as Uber or Lyft rides. Although these services may be convenient, they add up quickly and can take away from funds in other areas where it may be more beneficial for me. To cut back on these costs, I plan to use public transportation when possible so that the cost is shared among many people rather than just myself.
Finally, another flexible expense that I could reduce or eliminate altogether is shopping for clothing and accessories. Shopping for clothes can often become an impulsive activity which leads to overspending. To help prevent this from happening, going forward I will set strict budgets for any type of shopping trips so that there are clear parameters in place before making any purchases. Additionally, instead of buying new items whenever possible try to shop secondhand stores; not only does this save you money but also helps with reducing waste since you are giving used items a new life!
Overall, by strategically curbing down these three flexibly expenses -eating out ,transportation & shopping-I am sure one can definitely create some space in their monthly budget allowing them the opportunity to invest into something more valuable/productive with their hard earned money instead!
