Daily Allowance

As you have created a good habit of tracking your expenses every day, the next step on the money-saving journey is to cut back on your spending by creating your daily spending allowance. I still remember the time when I used to spend money carelessly on random things. Most of the time, I buy things at first sight. Instead of thinking carefully about whether I really need a particular item or not, I just bought it anyway regardless of its value and contribution to my life. This is the worst action ever since you will run out of money even before you can notice.

What is a daily spending allowance anyway?

A daily spending allowance is a limit I created to limit myself from spending carelessly every day. At first, this seemed like an impossible task since I did not know how much is enough since every day is not the same. There are days I need to go out, have a drink with my friends, dinner with my lover, or some other miscellaneous expenses that I could not foresee. However, not thing is impossible if you put your heart and mind into it. I believe that nothing beats practice, and practice makes perfect. To successfully save money, I started by allowing myself to buy only necessities plus one or two miscellaneous items. For instance, as a student, I live by myself so I planned to cook at home. If you cannot cook due to whatever reasons, don’t panic since you will still be able to save a lot of money if you are strict enough with yourself.

How I did it

With that said, I allowed myself less than forty dollars per day for breakfast, lunch, and dinner no matter where I have those meals. If I went out for breakfast, and it cost me over a third of my daily allowance, I would have to figure out what I want to eat for lunch, and what I want to eat for dinner. In most cases, lunch and dinner are more expensive than breakfast since they are bigger meals. However, for some people, their breakfast is the most important meal of the day and it costs them more than their lunch or dinner. If you belong in the second group, just make sure you think thoroughly about what you are going to buy during the day so you do not run out of money.

Tip of the day

In case you spent too much on breakfast and lunch and ran out of money before dinner, use the allowance on miscellaneous items to buy dinner instead and don’t buy anything else until the next day.

Aside from the daily allowance for my meals, I also set up a daily allowance for other purchases. For instance, after I subtract all of the fixed expenses from my monthly income, I divide whatever I have left by 30 days. As long as I know how much I have to spend for one day, I can figure out how much I got left to spend on food and other miscellaneous things.

I would like to ask you to try and figure out your daily allowance. It may seem confusing, but as soon as you get it, your life will be much easier since you are in control of your expenses.

Taking the First Step

While saving money is not an impossible task, it is not the easiest task either. By the time I realized I need to start saving money, I did not know where to start, but after putting some thought into it, I finally decided to start with creating a habit of tracking my own expense. For many people, including myself, tracking your own expenses is not something you always do everyday. A lot of the time, we tend to just forget what we bought in a day, and repeat the same thing the next day. To stop myself from making that mistake, I started to keep track of my spending everyday.

After each day, try your best to recall every purchase you made. If you cannot remember everything, do not worry, keep trying so you can create a new habit in your brain. The human brain is a powerful machine, but it is very lazy, at least that is how I feel about mine. As I try to do something new, especially something related to remembering, my brain does not want to cooperate. However, I took control of what I need to remember, and gradually, I formed a new habit. With that said, after each day, recall every purchase you made, and write them down on your note.

First saving tip, use your old notebooks from school for this task. Most people do not ever use more than half of a notebook by the end of the semester. Instead of buying a new notebook, make use of the old ones so you don’t waste your money.

As you write down your spending within a day, you may be surprised by the ridiculous amount of money spent on things you don’t really need, or impulsive buying. I was very surprised by my own spending too. I still remember how shocked I was when I first looked at my spending within a day. I spent almost forty dollars on snacks including a cup of milk tea, some fried calamari rings, a side of sweet potato fries, and a bottle of water.

Second saving tip, use a reusable water bottle instead of buying bottled water. It is both good for the environment as well as for your wallet.

No matter how much water you drink per day, there is always a reusable bottle that is big enough for your needs. In addition to my sixteen ounces water bottle, which is not a very big one, I always keep a big jug of water in my car trunk so I don’t ever run out of water during the day that would lead to me buying bottled water.

What even worse than spending forty dollars on snacks was to spend seventy dollars on chocolate. Yes, I spent seventy dollars on chocolate from Whole Foods market. Though Whole Foods market is a good place to buy organic stuff, it can also take away your whole paycheck. Instead of buying chocolate, I could have bought some fresh organic groceries for only half the amount of what I spent on chocolate. By the way, I bought one chunk of milk chocolate, one chunk of dark chocolate, and one chunk of white chocolate that day. They taste just like every other chocolate I have ever tried. After I looked at my spending on that day, I spotted the problems right away. I was wasting my money on something I did not really need. With the new and good habit of tracking my expenses, I kept finding unnecessary expenses along the way, and it helped me to eliminate spending my money on random things.

As of this point, I would like to ask you to start tracking your spending if you don’t already have. Sit down after each day with your notebook, and start writing down as detailed as possible what you have spent your money on in a day. You may be as surprised as I did.

Why I Started Saving

Being a college student, my biggest concern has always been finding the balance between school and work. Although school is fun, it is very challenging if you have to work to support yourself while taking classes at the same time. Over the past few years, I often find myself struggling to make enough money to cover all my expenses. Coming from a humble working-class family, I understand that money does not grow on trees. After I moved out of my parents’ house for college, I have always tried my best not to become a burden for my parents. Thus, I thought it would be a good idea to take fewer classes and working more hours. This was a huge mistake.

Right after high school, I tried to work rather than focus on my education. Being too young and reckless, I told myself that I still got a lot of time to enjoy life, why do I need to rush for anything? Instead of seriously thinking about school, I worked many part-time jobs to make as much money as possible. As I was able to support myself, I gradually turned into overspending without noticing. While other people were busy with school, I was proud of myself for not being tied up to anything. I did not realize that while other people were building their future, I was ruining my future. Because I spent every dime I made into whatever fun I wanted, I did not have anything left at the end of each month. As time went by, I began to realize that my friends were graduating from college with degrees and started to find better jobs than I had. By the time I came to realize that I have wasted years of my life for nothing, I scrambled to get back on the right track.

As I came back to college and began to take more classes so I can finish my overstretched education as fast as possible, I could no longer work as many hours as I used to. Without half of my monthly income plus tuition, I started to feel the struggle. Although I was able to get some grants from the schools, I still could not figure out how to make it to the end of each month without running out of money. I was stressed out and depressed. There were times I wanted to just give up my future and come back to my old lifestyle. However, during the worst time of my life, I took a deep breath and looked into the problem. I finally realized that the problem is not coming from the outside but rather from the inside. My problem was that I have always been overspending without noticing it.

Once I was able to figure out myself, I changed my spending habits, and now I am living a much healthier lifestyle. Not only did I stop struggling with my financing, but I also figured out many useful lessons and tips to save money while we are in school. Nowadays, a lot of students are still having the same problems I had years ago. I hope that through this blog, I can help others to get through their financial challenges so that they can enjoy their life to the fullest.

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