We make good money, so where’s the money?

The feeling that the money we earn through hard work simply “flows” through our fingers accompanies many of us. Th vague expenses, small expenses that we do not consider in our day-to-day management, are the ones that often add up to a significant amount.

So where is the money really? Here are some ways we can track down the missing money

1. Small money – a big expense

When we spend “small money” on completely marginal purchases, we usually think: “Well, it’s only a  few shekels, what’s the harm?.” sounds familiar ? “Coffee and pastry – how much does it even cost?”, “Popsicle for children in the pool is only a few shekels”, “We finally went to the movie, can you watch a movie without popcorn?”. these notions seem sensible, But the sad truth is this: The tendency of small sums is to accumulate and reach thousands of shekels a year. Yes, thousands of shekels!. Families who eat out regularly spend an average of 30-40 NIS a day on buying ready-made food might find out that the cumulative amount per year is about NIS 9,000. Even “only” coffee and pastry every morning for one person costs about NIS 4,000 a year. So what should we do you ask yourself – shouldn’t we enjoy some entertainment? Of course not. Go out for entertainment but do it wisely: manage a budget tailored to your income and expenses and allocate an amount in advance for entertainment.

2. Buy what you need

Many families live in the belief that the money they earn through hard work is used for basic needs: housing, monthly bills, food and transportation.

Living in a tight financial framework also gives many families the feeling that they are living very sparingly. Family members feel that even though they count every single shekel and even though they don’t spend time or enjoy themselves, the overdraft in the bank is just growing.

However, from the experience gained from accompanying thousands of families, we have learned that while everyone defines “need” and “want” differently, we all have things we don’t really need.

Before making an unplanned purchase, check whether the reason for purchasing the product justifies buying it:

• Do you really need it?
• Do you need it now?
• Will you use it?
• Is it worth the money?
• Is it possible to purchase a similar product at a lower price?

Once you clarify for yourself the real reasons for your desire to purchase the product, you can make an informed decision.

3. Is every time a good time to shop?

So, we made a decision to pay attention to the money that “escapes through our fingers”, but are we aware to the fact that there will be times when we will do well and times when we will succeed a little less? So, when do we tend to spend more without noticing?

The modern lifestyle and stressful schedule in which we all live sometimes cause us to make quick purchases that allow us to move on to the next task. Such acquisitions often turn out to be uneconomic.

Let’s be honest, who on occasion hasn’t bought a beautiful outfit or a shiny new gadget just to make us feel better?

 After all, most of us will agree that shopping can make us feel better and improve the situation but this is exactly the time to stop for a moment and think about whether the specific purchase will actually improve our situation or make it worse. Are doing something that might make us feel better for a short time but down the line will cause us to pay a costly economical price and will add emotional stress? Or perhaps our ability to give up the purchase will strengthen our sense of self-control and improve our mood.

Therefore:

• Try to avoid spontaneous shopping.
• Put some thought into planning the time you spend shopping and come prepared to buy.
• Make a list according to which you will make your purchases at the supermarket or shopping center and conduct market research to compare prices before purchasing a service such as car insurance.
• Try to avoid buying things whose sole purpose is to improve the way you feel but have no practical value.

4. Social or group buying

It’s a proven fact that when we are in a group, we buy more. It might be because others in the group do that or because of peer pressure and the will to blend in.

We need to remember that the behavioral norms and purchasing habits of groups to which we belong influence our shopping considerations. When we spend just to address matters of ego and social status, as well as a little desire for “everyone to see how successful I am,” the money is perceived as worth less and easier for us to spend.

So, it is recommended to stop for and think for a moment if this kind of shopping is the right kind for you and stick to what works for you. Perhaps taking a different stance from that of the group is better for you.

5. Working with customer service centers is a job in every respect and could generate considerable income.

How much money do you throw away each month when you haven’t spent time reviewing contracts with various parties? Well, you might be surprised to learn that it could be thousands of shekels per family a year. Let’s imagine you were offered an additional income of NIS 1,000 a month working a few hours from home or from the car, would you refuse?

It’s true, Referral to service centers is time-consuming and exhausting, so it’s best to treat this time as work time in every respect.

So, take the time to test your service providers on a regular basis:

• Your communications, cellular and internet packages.
• Bank fees – You may be able to save money by challenging the bank to lower your fees or by switching to another bank.
• The cost of credit cards and various loyalty programs, many of which you do not use at all.
• Insurance – Maybe you have duplicate insurances or ones that don’t suit your current or future needs and yet you pay for them every month.
• The fees you can save in your provident funds, study funds and pension fund.

Finally

Money doesn’t really go away on its own, but sometimes we tend to spend without realizing it. The good news is that you can definitely change it. Conscious purchase, planning and control will lead to a change in spending habits and strengthen control over household finance management. That’s how you’ll find the money.