How to manage your living expenses

How to manage your living expenses

Unfortunately, a part of everyone’s normal life is calculating and managing expenses. There is no escape, so the best thing to do is to get to know them so well that you can deal with that without having to spend hours and hours making calculations.

Getting to know your living expenses will allow you to save precious time but, also, money. If you know where your money is regularly going, you are more likely to learn how to save. This is a way of having control over your finances which ultimately is the goal. So let´s see how to do this.

What monthly expenses should you take into account?


This is the largest expense, whether you spend it on the rent or a mortgage. This is expense is most likely going to take up the majority of your budget, particularly if you live in expensive cities such as New York or LA.

2- Utility Bills

Many people want to keep bills separated from the housing expenses when elaborating a budget, because these will normally vary from one month to the other. Among utility bills, we have gas, electricity, heat, water and internet.

3- Transportation

You need to keep track of your transportation expenses because you go to work, you go on vacation, you visit your family and friends. You spend money getting around. 
Transportation is usually the second largest expense, especially if you commute to work every day. If you use public transportation, include the fare for each leg of the trip. If you drive, in this category you should include gas, car insurance and maintenance.


A very important item on your expense list. Average spending on groceries is $550, but this depends on the number of persons you buy food for. Of course, this expense is much less if you live alone than with your family.

Additional expenses

The four items we mentioned before are the main core of your monthly budget, but there might be some other expenses you need to take into account. For example, if you have children, you might want to include in the list the childcare-related expenses. Today, childcare expenses are calculated to be between $10,000 and $16,000 per year depending on the age of your child.

Also, if you practice a regular activity like going to the gym, you should include the cost of the membership in your list. 
Take accountability for retirement savings and health care insurance as well. Once you know all your regular expenses, keep them organized so that you can make payments every month and keep track of where your money is going.

Determine whether you can make adjustments to your budget or if it admits rearrangement. If there is room for improvement, take that opportunity to make the most out of your income.

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