Published on June 7, 2017 6:10 am, by Pete Lalor
The concept of getting ahead financially is deceptively simple – earn more and spend less. If we can do this we can pay down debt, build up a financial buffer of savings or save and invest for longer term goals. But it is easier said than done. Where do you start?
Few of us have direct control over what we earn and improving our income takes time. But all of us can start making different decisions today about how much we spend and what we spend on.
To help you do this we have calculated an estimate of what it cost you to live an average day in May 2017 and where we could we have compared it to your average daily cost of living in April 2017, March 2017 and for the whole of 2016.
For many of us, this number will be a real eye opener and will be greeted by responses like “Really? It costs me that much to live?” or “What did I spend all that money on?”
After the initial shock you might want to consider things like:
Unfortunately, for most of us, as our income rises so do our expenses – locking in a kind of ‘personal rate of inflation’ which can keep us from reaching important financial goals and financial freedom.
MoneyBrilliant can help you answer these questions.
Use our spending reports to track your spending over time and look for trends, see how much you spend on essentials and lifestyle. In the app you can change the categories that go into each if you don’t like our definitions of essentials and lifestyle spending. Use our categorisation of your spending to see how it aligns with the things that are important in your life.
To login to the MoneyBrilliant app and go straight to spending reports for May 2017 click here.
You can also use the Net Worth feature (and the Net Worth tracking feature available to Plus Plan members) to track the changes in your Net Worth over time. For further details of the features available to Plus Plan members and reasons to upgrade have a look at details of our Plans.
We will also send you a summary of your daily cost of living each month in your Activity Feed to help you track changes.
The simplest answer is that it doesn’t matter! Your average daily cost of living is all about you. It is only an estimate and we believe that how it changes over time is what’s important. However, we know that people will be interested in how their cost of living compares to other peoples. The following chart shows you a distribution of average daily cost of living to help you see where you sit – below average, average or above average!
We think that having one simple number is a cool way to think about our spending habits. We hope you have some fun with it and find it helpful in setting goals and tracking your progress in 2017.
Calculating an estimate of your daily cost of living in a meaningful way for everyone is difficult. We had to make a number of decisions to try and provide the most meaningful estimate for the most people. Here is what we did:
If you’ve looked the number and just don’t believe it is correct, possibly you just don’t realise what it costs to live an average day of your life!
Seriously though, there are a number of things that might affect the accuracy of your calculation including:
If you spot something that is incorrect please let us know at email@example.com
Peter is the CEO of MoneyBrilliant. He has over 20 years experience in banking, insurance and accounting. Peter has three sons, ranging in age from 16 to 3, is a sport and fitness fanatic and a volunteer firefighter. He is passionate about improving people's lives through making financial services more accessible.