Question

Certain behaviors can either assist or hamper reaching financial goals . One such negative source is not controlling or being unaware of spending habits.

Review your own personal spending over the past few months. Identify sources of “money leaks”. (A “money leak” can be defined as an “unbudgeted” expenditure - to include going beyond the budget set for the item) .

Did the extent and/or category of the money leak surprise you?

What might you do to control future money leaks?

Answer 1

Money leaks is a an unbudgeted expenditure. Health emergency and travel due to it can be one such case. Others can be special event gifts like birthday or other if a job is changed recently.

Money leaks can also happen due to usage of credit cards as need to pay is not immediate and people may think of cutting other expenses but end ups having more spendings and financial goals cannot be attained.

Automobile accidents and payments involved are also money leaks. This expense can be much higher than expected and can surprise a lot.

To avoid money leaks an emergency fund can be created and some money can be deposited every month to prepare for contingency. Insurances can also help in avoiding money leaks. Usage of credit cards can be avoided to reach financial goals promptly.