Part One-"Start Thy Purse to Fattening"
My husband and I are reading a book called, "The Richest Man In Babylon." In the book, the richest man in Babylon is teaching 100 men how he became rich. He teaches them "7 cures for a lean purse". I have decided to use these themes for my budgeting series.
The first step is to "Start Thy Purse to Fattening." We learned from our reading today that the first step to becoming wealthy is to spend less than you earn. At first this sounds a little backwards. It seams like you must first be at least a little bit wealthy in order to be able to spend less than you earn. The key is to spend LESS than you earn- not earn more than you can SPEND.
On a college student budget this can be tough. If you are not able to work while in school, this may even be impossible, but the principle can be practiced and applied at all stages of your life. The principle is that if you are not making any money, you should be spending as little as possible. If you are making a little money, spend a little less than you are earning.
When my husband and I were both in school we were not working enough to pay for much more than our rent, so the rest of our monthly expenses came from savings. Even then, we were able to implement this principle by setting a limit to our spending. We did not spend money on unnessesary things. As we practiced this, we began to realize more and more things that we could do without. We moved to a smaller, much cheaper appartment; we were more aware of how much electricity we used; we rode our bikes to school instead of driving- all these things cut out unnecessary expenses.
Now that we have a small income, we are able to set goals and set aside savings each month. Right now this will rebuild the savings that we have been spending during school. Eventually, we will be able to invest this money, which is another step to come. So, step one, cut out all those unnessesary expenses that you cannot afford.
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