I’m just going to say it…
I am absolutely amazed that more people don’t balance their checkbooks. It is, what I consider, the first and easiest step that you can do to set yourself up for a life of good finances.
Don’t underestimate the power of tracking your income and expenses. It can really be life changing, especially if you have never done it before.
I’ve watched people use their debit cards like they are credit cards and never enter any of their expenses in their checkbook. Guess what happens? They start getting hundreds of dollars of overdraft fees. It’s fine if you want to use your debit card like a credit card, but just track it!
People end up in the above scenario because they have heard that they should cut up their credit cards and pay cash for everything. While it is good in theory, this idea leads to bad practices like the one above.
So here is our first challenge in The Personal Finance Challenge Series…
Balance Your Checkbook
1. Start today.
2. Don’t type it, write it. It is preferable to write it down then to type it on a computer. Something about physically writing it down tends to help you absorb the skill better.
3. Do it daily. Don’t let receipts pile up for any length of time. Make it a daily habit.