How Do You Reduce Your Personal Expenses In a Month?

It's not as hard to cover your personal expenses as you'd think, even if you're supporting a family.

For 82% of Mexican men and women it is difficult to cover basic expenses and pay their personal bills. Regardless of whether they support their family or not.

According to a study carried out by the financial product comparison platform Coru.com, in November 2020, 8 out of 10 Mexicans - between 18 and 54 years old - ensure that personal and household expenses each month.

For both women and men in this age range it is “somewhat difficult” or “very difficult” to pay for basic services such as water, electricity, gas and internet and other fixed expenses such as credit cards, personal loans or batches with your current income. This regardless of the number of economic dependents. Even if they don't have them.

“There is a belief that singles have a more comfortable, healthier financial situation. However, those who do not have financial dependents have difficulties despite having fewer responsibilities. This is partly due to the current economic outlook, but also due to the lack of attention to money leaks, ”says Sebastián Medrano, director of Coru.

Those "ant expenses" that you do automatically as part of your daily routine, or that are small but constant - the "phantom expenses" - represent up to 12% of a worker's annual income, according to the National Commission for Protection and Defense of Users of Financial Services (Condusef).

Identifying these types of expenses in your life is the first step to having healthy finances and reaching the fortnight without problems. We know that being an exercise in self-knowledge it can be difficult so Coru has some tips that will make this task easier:

Record your expenses

Did you give a busker some coins? Did you buy gum at the stoplight? Do you have a subscription to one or more streaming platforms? Write it all down. For a fortnight, record every expense you make, no matter how insignificant it may seem: from the subway ticket or the Uber ride to paying for basic services. At the end of the two weeks identify what your unnecessary expenses are and limit them in the next two. You will be surprised to see the difference that those small expenses make in your fortnight.

Check your receipts for services and account statements

Sometimes the memory fails and you forget the services to which you are subscribed or, even, that you do not know what you pay for. Review your account statements in detail, as well as internet or cable television receipts, to identify the subscriptions and charges that you have not stopped using, or insurance and plans or services that you did not know you had contracted. Avoid trial periods or if you use them, don't forget to deactivate them.

Ask for feedback

Image: Charles Deluvio via Unsplash

Identifying ant expenses in your daily routine can be a very difficult task, especially since you do them automatically, without thinking about it. Ask for help from a friend or relative with whom you live regularly; This will help you to analyze with different eyes whether an expense is normal, or to reflect on whether an expense is normal or is actually unnecessary. For example, having a high-speed internet service may be necessary in the context of the COVID-19 pandemic either for work or school reasons, but if you do not work at home or live alone it may be an excess. Remember that this exercise is without getting angry, they are only there to help you.

Put things in perspective

Once you have identified the expenses, do the math. How much do you spend on coffee a fortnight, and on gum? How much of your fortnight is going to pay for streaming services or subscriptions that you no longer use? For example, if you have the most basic memberships for streaming audio and the three main online video platforms, you spend almost 6,500 pesos a year, the equivalent of an all-inclusive in Cancun for four days in a 4-star hotel.

With these tips, your finances will have a short-term improvement. However, to achieve financial stability and peace of mind, the ideal is to complement them with a budget, as well as a savings plan.

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