What's Your Junk Crap?

Posted by : foongpc | Friday, June 6, 2008 | Published in


With the rising cost of petrol and the cost of everything else that will rise with it, I can see only 3 options.

Option #1 : Earn more money

Option #2 : Spend less money

Option #3 : Combine both Option #1 and Option #2 (the most ideal option)

Now I’m not terribly good at Option #1, but I’m even worse at Option #2.

But I gotta start somewhere. So, today I’m going to focus on Option #2 ie. Spend less money.

It’s actually easier said than done. I notice that before the end of each month, I always run out of money. Luckily for me, I always pay myself first. That means I always save 10% of my monthly income and put it into my savings account which I don’t touch. (Yes, I make sure this savings account cannot be accessed by way of ATM machines!)

But after deducting the necessary expenses like house loan, car loan, insurance, petrol, food, household bills and the like, I am usually left with a small amount to spend. From this small amount, I try to place some money into investments, and then use the rest for other spendings.

The trouble is, my spending always exceed my budget for the month. I just don’t know where I spent all those money!

According to Azizi Ali in his book, The Millionaire In Me, not knowing where your money goes is BAD NEWS! From his book, I found a method where I’m able to trace where my money goes every month. Azizi called it the Money Tracker.

Here’s a snapshot of the Money Tracker from his book.

Everyday, list down what you spend. Big or small. It can be for big items like buying a TV or small like parking charges. List down everything. Once that is done, fill up the Priority Codes.

There are 4 codes, namely:
1 – Mandatory Oxygen
2 – Essential Food
3 – Nice
4 – Junk Crap

For example, petrol and food comes under Mandatory Oxygen. It is for the things that are absolutely necessary for us to survive. Next, books may come under Essential Food if you like to read. Going to the movies and yoga classes may come under Nice. And cigarettes or clubbing may go under Junk Crap.

Of course different people have different priorities. You may like clubbing and place it under No. 2 Essential Food. Or you don’t read books, so spending money on books is Junk Crap to you! Some people are gym junkies so for them, spending on the gym’s monthly fees is Mandatory Oxygen to them.

But really, do re-think your priorities very carefully in view of the escalating expenses. I hope you don’t put clubbing under Mandatory Oxygen and food under Junk Crap! Then you surely have your priorities wrong!

Even for food, it does not mean all food goes under Mandatory Oxygen. For example eating at a lavish buffet in a 5-star hotel surely qualifies under No.3 Nice or even No.4 Junk Crap if the food is lousy.

Thanks to this Money Tracker which I started using 3 months ago (I wished I had started sooner), I am able to know exactly what I spent on. And I have managed to stop spending on those Junk Craps. You’ll be surprise how much money you can save by making use of this Money Tracker.

So, let’s not procrastinate. Identify your Junk Craps today!

(13) Comments

  1. Anonymous

    Interesting. Money Tracker, that's a good one. I am using microsoft money at the moment, it help to generate report based on your preference and can forecast my cashflow the next 3 months or 5 years and know where my money goes tracking digitally. The only thing is to self-discipline.

    June 6, 2008 at 3:05 PM
  2. Më| §zë said...

    hi.. blog surfing...
    yeah... i keep my accounts everyday, yet, my money still disappears.. i'll try your tracker..
    i'm sure it will yield results!!!
    and i gotta be disciplined!

    June 6, 2008 at 3:32 PM
  3. Unknown said...

    totally agree on option 3. (though i think 1 should outweigh 2 if possible - well thats for me) :)

    in any case, i hope msians will be able to bite the bullet and continue to live a rather happy life as much as possible :)

    June 6, 2008 at 7:29 PM
  4. Bengbeng said...

    i am down to the barest essentials. i dont see how i can cut down any more...even to the extent of using a bike whenever possible, turning off air con, minimum or nil non essential purchases, terminating newspapers, no air con, no eating outside etc etc

    June 6, 2008 at 10:37 PM
  5. foongpc said...

    Thanks Kenneth for your comments. Yes, definitely need to have self discipline.

    June 8, 2008 at 12:11 AM
  6. foongpc said...

    Mei Sze, thanks for dropping by. Let me know if the Money Tracker works for you : )

    June 8, 2008 at 12:15 AM
  7. foongpc said...

    quachee, yes best of luck to all Malaysians!

    beng beng, maybe it's time you start to think of Option #1 ie. to earn more money : )

    June 8, 2008 at 12:18 AM
  8. Anonymous

    Hi Foong,

    Great blog you have here. Very informative. I'm using Moneyplanner to take care of Option 2 and at the same time work on Option 1. I'm much wealthier and feel good everyday. Whenever you want to spend on something.. always ask yourself this question -Is it a need or is it a want?

    June 10, 2008 at 1:14 PM
  9. foongpc said...

    Joan, thanks for your comments. Good advice!

    June 12, 2008 at 11:07 AM
  10. khengsiong said...

    I guess I am too lazy to list down my expenses :P

    October 27, 2008 at 12:55 PM
  11. foongpc said...

    khengsiong, then you'll never know where your money goes! : )

    November 1, 2008 at 9:20 PM
  12. Faisal Admar said...

    I got a copy of this in Malay (because my younger sister and mom want to borrow so I better buy the Malay version). I always write down my daily expenses in a log book. So, I know whee my money goes. I separate bank account and daily expenses. So, that I can know the balance in the bank and how much money I have spent in a day and a week. His method really works on me and it helps me a lot. Last time I did not know where the money goes, but now no more. I always watch 2 things fighting with each other: Necessity vs Necessary.

    Option number 1 is average for me and Option number 2 is my best. Let say last 2 years I could not save a single cent but last year I managed to save RM10,000. Well, that is only an example.

    I pay car too but house will be completed in 2010. By that time, car loan already fully paid. Thank God. Thank you Azizi :)

    November 30, 2008 at 1:23 AM
  13. foongpc said...

    faisal admar, Azizi sure helped you a lot. Is that why you help promote his books on your blog? LOL

    December 16, 2008 at 1:34 AM