It’s important to focus on the big picture as well as the small expenses. Consider the chart at left click to enlarge): housing and transportation are the two biggest categories. Lifestyle and spending choices have a big impact on your budget, for example, commuting many miles vs. living near where you work.
There are three parts to your budget: spending, saving, and earning.
- The less you spend and the more you resist lifestyle inflation, the more room your budget has for YOUR priorities.
- The more you save and invest, the more your money works and grows for your future.
- The more you earn, even if it’s just negotiating a dollar more per hour when you land your next job, the more your earnings will grow based on your starting salary.
Sure, make your coffee at home. But don’t forget to sweat the big stuff.
What choices will have the largest long-term impact on your finances?