How to Manage Your Money and Get Motivated to Save

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I love, love, love numbers, math and money.  I’ve been this way since I sold candy in middle school. Early in life I learned that it is possible to have everything you want. The key, of course, is having a little patience and coming up with a plan.  I have a tried and tested system for managing my own finances and I’ve shared it with close friends. It seemed to help them, so I figured, why not share it with more people.

It’s nothing revolutionary, it’s just an organized system that works and motivates you to save.

write down everything you need

First thing’s first, identify everything you need (specifically your monthly expenses) and categorize those things as either essential or non-essential. Then identify which costs are fixed (the same amount each month) and which are flexible (change each month). The list might look something like this:

  • Essential fixed costs
    • Rent
    • Phone
    • Utilities
    • Cable/Internet
  • Essential flexible costs
    • Food
    • Transportation
    • Home supplies
  • Non-essential fixed costs
    • Student loan payments?
    • Minimum credit card payments?
    • Furniture payments
  • Non-essentials flexible costs
    • Entertainment
    • Personal Care
    • Anything else?

Place how much you spend each month against each item. Guestimate if you don’t know for sure.

write down everything you want

This next step is a fun step.  Write down everything that you want. I mean everything. Think about what you’d buy if you had an extra $1,000, then an extra $10,000 and an extra $100,000. Take it as far as you want. Then prioritize those things. Which things do you want the most? Which things can you realistically get in the near future? The list might look like this:

  • Fancy dinner at Mr. Chow
  • First pair of designer shoes
  • Five day trip to Capri, Italy
  • “Pie in the sky” apartment in NYC
  • and so on…

I usually factor in rainy-day savings at this point too, even if it’s just $5 or $25 a month. Anything is better than nothing.


This is the part most people don’t like, but it’s the part I LOVE: analyzing your current spending.  In this part of the process you need to really assess what you’re spending your money on. You can do this in a couple ways: If you tend to save receipts, put your receipts into categories and sum up the total of each category. If you use your debit/credit card a lot, some banks have an online banking feature that shows you were you’re money is going. If yours doesn’t, typically you can export your transactions into an Excel sheet, put each transaction into a category, then find the total of that category. If neither of those options work for you, use your best guess.  Your best guess won’t be as accurate, because typically we spend a lot more money in certain areas than we realize. But guessing is a starting point. I highly recommend It’s a great web-based tool (and app) that allows you to keep track of your spending.

When you have a sense of where your money is going, you then need to assess how much disposable income you have each month. Very simply, you take your total monthly spending and subtract it from your monthly income. For example, if all my essential and non-essential costs total $800 a month and I earn $1,000 each month, then my disposable income is $200 a month.  You want to know how much disposable income you have, because that’s the money you’ll use to get the things on your “want list.”  If you’re spending less than you earn, great; you’re on your way! If you’re spending more than you’re earning, you’re in a bit of trouble.

scale back if you have to

Once you’ve assessed how much disposable income you have each month, you may decide that you need to cut down. This is when you go back to your list of costs (expenses).  Start with your fixed costs. Are there any that aren’t really essential? For example, can you have Internet without cable? Nowadays, almost every TV show and movie can be watched online. Can you get on a different phone plan to reduce your monthly bill? Are there other student loan repayment options you can utilize? After taking a hard look at your fixed costs, take a look at your flexible. It’ll be easier to cut these down; start with the non-essential flexible expenses. Can you eliminate any all together? Which ones aren’t so important in the grand scheme of things? Then move onto the essential flexible costs. There are tons of ways to save money on groceries, where can you cut back? Is carpooling, biking or walking a transportation option for you? Your goal here is to get your spending down to a point where you have some left over money. How much money you have left or want to have left will be based on which thing on your “want list” you want to get first.

On another hand, you may realize that you’re in a position where you can’t cut down anymore and need to find an additional or new source of  income. Small tip: If you have extra space in your apartment or can couch surf while someone stays in your apartment, AirBnB might be a good supplementary source of income for you.

stick to your budget

Here’s where you really have to put in the work. If you’ve assessed your monthly expenses and identified places to scale back, what you’ll end up with is a budget. Sticking to a budget can be hard at times, especially when it comes to flexible expenses, but one cool way to do it, is to put all your fixed bills on auto-debit if you can, then put your credit/debit card away. Instead, take out all (or maybe half) the money you’ve allocated for flexible expenses in cash. And only spend the cash. You’ll be more aware of how much you’re spending because you’ll see your money decreasing as you spend it. Sometimes I only take 20 bucks with me on a night out (and that’s a splurge for me, lol!).  But you’ll be surprised how much money you really don’t need on a day-to-day.

Another part of sticking to a budget is staying motivated. If you’re cutting back for no particular reason, you may find it hard to stay on course. But if you’re cutting back because you have to or because you want one of those shiny things on your “want list” more than you want some of your monthly incidentals, you’ll be motivated to stay on the wagon.

planning and patience

Even if your disposable income is only $10 a month, it’s something.  Say the dinner at Mr. Chow will run you $100 bucks.  That means in ten months, you can have that dinner. Ten months might seem like a long time, but it really isn’t in the grand scheme of things. And realizing that, understanding what really is a long amount of time and what really is a short amount of time is critical. In the Insta-facebook-twitter-gram world we live in, we’re used to getting some things within seconds, but usually those things aren’t really worth having. Anything of real value usually takes time to acquire.

The nice thing about saving toward an item on your “want list” is it’s motivating. You get to watch yourself (by way of how much money you save) get closer and closer to your shiny object. I’ve done this for many things–jewelry, gizmos, and trips–and the real benefit of it is that it’s confidence-building. It’s made me feel in control, not just of my money but my life, by way of the things that I’m filling it with. Start with something small and realistic, when you acquire that thing, you’ll be motivated to get something else. As you keep on going, the bigger things on your list start to look more feasible and your belief in your ability to get those things will strengthen.

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An entrepreneur at heart, I founded Unruly in 2013 after spending six great years in advertising. I’m über lazy when it comes to doing my hair so I’m always looking for easy and quick ways to care and style my hair.

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