Mind your budget and grow your money

MONEY FROM B1 spending for one month so you have a clear picture of where your money is going. If you can’t track for a whole month, don’t worry— even a few days can be eye opening.

Wells Fargo offers My Spending Report, a valuable tool for savers for making tracking expense tracking less cumbersome.

Identify areas to cut back

After you know where your money is going, you can decide what you really need versus what you just want. First, put your spending into one of the three categories below then think about how you can modify a few of them.

• Fixed essential expenses—Necessary expenses that are the same every month. This includes your mortgage/rent, car payments, student loans and insurance.

• Variable essential expenses—Necessary monthly expenses that might cost a little bit more or a little bit less each month. This includes things like gas, groceries, utilities and cell phone bills.

• Non-essential expenses—The other things you don’t necessarily need, such as eating out, going to the movies, daily trips to a coffee shop etc.

“Budgeting is not just a matter of watching your money and knowing how you spent it. I did that daily on my banking app and eventually it dawned on me that I had to be more strategic in tracking and saving money. I had to set goals,” explained Wells Fargo customer Michelle Fling.

Now review your “non-essentials” category. Where can you cut spending?

Consider expenses like, subscriptions, memberships, and shopping, dining out, electronics and entertainment.

For example, it’s easy to overspend on

CFPB seeks end

food. If you typically spend $100 on takeout, budget to spend less than $50 and put the other $50 into savings.

Establish an emergency fund equal to six weeks of your income.

Don’t be discouraged if you have no emergency savings yet. Start by saving a paycheck’s worth of income and build from there.

Once you’re ready to start cutting back, My Savings Plan® can help you track your savings progress.

Most importantly, create a budget you can live with.

Don’t be overly ambitious to reach that savings benchmark and develop a budget that in reality won’t work for you and may even deter you from continuing on.

After identifying areas to cut spending, you’ll want to create a budget that allows you to save weekly and or monthly, prefer- ably both.

To make budgeting easier, use Budget Watch to set specific goals and get notifications when you’re nearing your spending limits. You will also be able to chart your monthly expenses with information taken from your actual spending history.

The good news is that African Americans for the most part survived this most recent financial crisis and we are coming out on the other side more confident in our ability to not only make ends meet, but to be more prudent in our spending and actually enjoy some of the fruits of your labor … and frugality.

(Wells Fargo’s vision is to satisfy all our customers’ financial needs and help them succeed financially. Wells Fargo perspectives are also available at Wells Fargo Blogs and Wells Fargo Stories.)