Tips To Stop Money Leaks

Do you ever stop what you are doing and scratch your head, wondering where all your money is going? It seems as if you are making a decent amount of income, yet for some reason, you just aren't able to save anything. This is a common problem shared by millions of Americans, but thankfully, there is a remedy that may be able to alleviate the problem. Sometimes referred to as money leaks, other times as simply "not getting ahead, " this epidemic can usually be contained if you are able to learn how to better organize your finances.

Where is the money going?

The first thing to do in order to discover why you have money leaks is to simply track all your spending. You can begin the process by making a list of all your monthly bills and the average amounts that is owed for each of them. Once you have added up the total, you will have an initial idea of approximately how much of your cash is utilized for necessary expenses.

After calculating how much you need to pay each month in order to pay your bills, the next step is to calculate where the rest of your money is spent. This can be a bit trickier, as you likely spend different amounts each month on food, going out for dinner, extracurricular activities, items for the home, etc. You may have to keep a record each week of exactly what you spend and where you spend it, and after a month or two, you should have a general idea of your spending habits.

Once you have successfully managed to organize your finances, you may notice a trend in your spending habits focused on one or two types of purchases that aren't really necessary, but seem to add up to a significant amount of cash. It may be going out to dinner too much, shopping for clothes, purchasing lottery tickets, etc. Once you know what your unnecessary spending habit is, the next step is to discipline yourself to cut back on it.

In order to stop money leaks you need to look at the spending reports you have created. Most budgeting software or online bank statements can create these for you. You will see trends. Maybe most of the extra money goes to one store, or is spent on the weekends. Whatever it may be take measures to avoid those places or events. When you track all your spending it becomes obvious where some big leaks are.

Money leaks that aren't your fault

What happens when there are money leaks that are unaccounted for, no matter how well you manage to track your spending and organize your finances? Perhaps you are a victim of identify theft. Thieves and scammers who successfully manage to steal credit card information can sometimes cause an individual financial trouble for quite a long time before they notice anything is wrong.

Think it can't happen to you? It's much easier than you might think for a thief to steal your credit card information, and it happens to someone in America every few seconds. Credit card fraud is on the rise in recent years, and though there are many safe practices for credit fraud prevention you might try, it is extremely difficult to be 100% foolproof against the crop of thieves circulating today.

Tips for Credit Fraud Prevention

There are many ways to stop identity theft. Some of the most common include:

• When using credit cards, make sure that you have signed the backs.
• Keep credit cards separate from your wallet—in the event of a lost or stolen wallet, your credit cards will still be safe.
• Do not throw away any intact banking or credit card statements—shred all papers containing such information.
• Check your credit report using a credit monitoring service that will alert you to suspicious activity.
• Always keep an eye on your credit card when you have it out to make a purchase. Be aware of your surroundings and of anyone who looks like they are a little too interested in looking at your card. Many thieves use old school methods such as simply snapping a picture of your card when it is out, and even cashiers could be potential thieves, swiping your card on their own scanner when you aren't looking so as to record the numbers.

  Amy Johnson is an active blogger who is fond of writing articles on Credit Protection and educating people to take immediate measure if your card is lost or stolen before someone take advantage of it. Follow her on Twitter to know more on stopping the money leaks by organizing your finances.