There is no need to pretend, for many of us, the idea of sitting down and creating a personal budget and accounting for every cent you spend, is about as exciting as watching paint dry.
You will probably swiftly change your opinion on that chore if you actually put yourself through the seemingly tortuous task of working out where your money is going, and suddenly find the sort of savings that can make it feel like you have had a pay rise.
Short term loans to tide you over can sometimes be a big help to your finances, and you get information from Captain Cash about that, but it also makes sense to try and gain a greater level of control over your cash, by looking at your current spending habits.
Keep it simple
It is a natural human response to feel a bit stressed when faced with something unknown, which is probably the sort of reaction plenty of us get when the latest credit card statement finds its way to you through the mailbox.
Making even a simple budget, will instantly help to ease your anxiety, if you can see what is coming in and what is going out each month. Crunching the numbers and seeing where your cash is going can be a real wake-up call and will quickly reveal whether your spending habits are out of line with your income.
It seems that many of us either don’t keep any kind of budget at all, and an equally large percentage of us tend to keep one in our heads, trusting instinct to know where they stand financially at any given point in the month.
Even a simple budget written down on a sheet of paper listing all your monthly outgoings and adding up your credit card spending, will often be revealing enough to stir you into some sort of action to review your spending habits.
Cash encourages restraint
We get closer to a cashless society with every year that passes so it does feel a bit strange to get a pile of cash out of the bank and try to live off that instead of using your cards, but you will be amazed what a difference it will make to your spending.
Numerous studies have often come to the same conclusion that most of us would be willing to spend more on something like a ticket to a game or a concert for example, if we pay by card rather than using cash.
It is so easy to just wipe your card and take your purchase, but if you have to pay cash for everything in the store or on a night out, you will almost certainly feel like you are actually spending real money and as a result, show a lot more restraint.
Try allocating some cash for groceries, entertainment and other routine purchases. Make a weekly budget on what you want to spend in each category and can afford, then leave the cards at home.
Your basket at the grocery store will probably not be overflowing with treats that you probably don’t really need anyway when you pay with cash, so try it and see what a difference it can make, or at least adopt the mindset that you are paying with real money not plastic, next time you are shopping.
Do you know if you are overspending?
You will have a certain financial personality that can probably be defined in a particular category, even if you don’t think so.
It might be for example, that you are a serial overspender. Ask yourself some searching questions about your financial habits and situation and you will probably get the answer.
Some of the classic signs of an overspender are when you are still paying bills from purchases that you made at least 12 months ago, and another common trait, is to always use credit cards instead of cash, even when it is a small purchase and you had the change available in cash.
Another classic warning sign is when your checking account is frequently overdrawn and also when your paycheck gets swallowed up each month, leaving you with an anxious few days or weeks as the month progresses, before you get another injection of funds.
If you are often running out of money completely and find that even a minor unexpected expense can cause chaos, there is a good chance that you are an overspender and need to commit to doing that budget as soon as possible.
It often takes only a few small steps in the right direction to put your finances on track, and this can make a big difference to your spending habits and improve your financial position quicker than you might imagine.
Eloise Poole has worked in finance all her working life, first in the credit department, then moving into a general personal finance consultancy role. She wants to help people succeed with their finances and spends some of her free time writing personal finance articles.