Tips for Controlling Spending

I integrated my accounts recently with Mint...certainly only one small step towards spending more responsibly, but visualizing everything in real time without having to input or track things on your own time is very helpful.

I personally don't keep a detailed budget, I buy what I absolutely need and save/invest the rest.

If I want variety, I go for something at a similar price of what I normally buy.

The biggest budget decision imo is make at home vs go out/order in. I prefer home cooked everything and hanging out at home, but try to get out 1x time every few weeks.

Another aspect is maximizing your credit card benefits. Get cards with benefits that you value, pay them off every month, and accrue your chosen points. E.g. I put all of my streaming accounts on a card that gives me 10% cash back, all of my airline and qualifying 2x/3x airline point purchases on another card.

Used to be in a similar position after I graduated (2019), until I got super spooked by the prospect of getting laid off due to COVID (which I was a week away from, but was lucky enough to internally transfer to a different desk at the same bank I worked for at the time) which really served to shift my mindset to a more conservative one, fiscally speaking.Now, while I suppose it took a bit of an external scare to get me out of my spending habits to become more serious about saving/investing, here are a few things that worked for me from a pragmatic perspective, at least:1) Start by looking at your credit card bill for all the subscriptions you have, as these are the silent killers that add up quickly. I mean, even Netflix is like $20/month now, so when combining that with 1-2 other services like Hulu, you're looking at $50 there easily. Think of how much time you realistically spend watching shows on each and cut here first. Same goes for paid news subscriptions; if you have a Bloomberg at work, that already gives you access to more than you need given it amalgamates other sources too. Personally, in today's day and age of controversy, I just don't find it worth it to shell out the extra $20-30/month to read the WSJ's woke op-eds.2) I'm assuming you work in the city for your banking job and thus live in a small apartment (my bad if not), but rather than thinking about the resources you use in terms of money (which may not mean as to you as others, relatively speaking) to acquire things, try thinking of the physical space you're using up to store your stuff, which I can all but guarantee would be in much less abundant supply, and the massive pain in the ass it will be to pack it all up the next time you move into a new place. This made a huge difference for me, and I actually find now that the anxiety that compounds from finding out where to store net new additions to my collection of things as well as what to do with the things I'm replacing (sell, trash, donate) outpaces the actual pleasure I derive from the things I buy. If it's something that only comes out every 5 years like a new PlayStation, and you love gaming, sure, that's totally reasonable to spend on, but do you really need a new iPhone every year?3) Try to think less about the price of things and more about the value. For example, with things like clothes and shoes, buy less but buy better,. In most cases, you should end up with less money spent, more space saved (helping point 2 above), and interestingly enough, a reduction in choices and variability you need to face every morning while deciding what to wear, which is also super elating.4) Not sure who you work for, but maybe worth checking out to see what kind of savings/investment programs and share purchase matching programs your employer offers. This tend to zap your contributions straight from your paycheque, thus fulfilling both the goals of saving more but without you even having to think about it, while forcing you to get by with less. $500 every two weeks goes a long way over the course of 3 years.Anyways, these are just some things that worked for me and made a notable difference, and that's without any sort of budgeting apps/spreadsheets (have never used a budget). Acknowledging that you want to save more is the first and probably most important step, which you have obviously made now given this post.

If you can track all your expenses, great for you, but I find that it drives me nuts. I know which categories I overspend and which are fairly stable, so I try to be extra careful in those categories.

I felt the same so I went and put as much info as I could into excel. Since I never tracked my spending before I used my credit card statement along with estimates (like average gas spending). Then set up the percentage compared to take home pay to see where you spend the most money. That's a great place to start to look where your money goes. See if anything can be adjusted relatively easily. And from there it depends. Maybe buy generic, maybe cancel some recurring costs, etc.

Automatically set up deposits to 401k/IRAs/Taxable investment accounts so you never see the money.

Focus on big three expenses - housing, food, transportation.

After that try to figure out what things are really worth it to you to spend money on (ex: travel and eating out). Spend a bunch on those and cut back on other stuff that you don’t care about as much.

I just wanna say spending money on the latest phone is utterly absurd to me. And I know I'm likely not supported in this camp but as someone who doesn't have IG/FB/Tiktok or whatever, I literally only use my phone for texting/calling/work emails/work msft teams. So why would I feel the need to get some clunky iphone with like 35 different cameras which shoots pictures of natgeo quality? Haven't upgraded my iphone in four years until now, which is when I got the SE model which serves all my aforementioned purposes just fine. Only saying this because I know plenty of people who "must" have the newest model of their phone and pay ridiculous amounts for this. Just don't get it.

Sounds like you're not open to this, but just wanted to say that I have very closely tracked all of my income/expenses over the past 3 years and it is actually really cool to compare spending YoY, MoM etc. Additionally, I know exactly what amount of money I save every year, what amount I can reasonably expect to save in the coming year, etc. 

One other thing I like to do is update my PFS/Net Worth every month - I've tracked this for the past 3 years as well and it helps motivate you to save and it's also cool to see how quickly your money grows. 

I used to track expenses monthly but transitioned to utilizing an annual non-detailed approach, which I think is better for higher income earners who don't need to truly worry about monthly cash flow. I break out my expenses into fixed vs variable for a handful of big categories only (housing, transportation, food, entertainment, travel etc). I put everything on a credit card(s) and review monthly at a high level (I don't use autopay as it forces me to log in and look at the balance and statement). I use the annual report by spending category tools on the website to review the spending categories with an emphasis on year end to see how I did and if I need to course correct anywhere in setting the following year's budget. 

Overall, the math is simple really - income less expenses and you can track this at the end of each month and dive in as needed on an intermittent basis. Food and transportation tends to add up a lot. 

YNAB is a pretty good budgeting tool that you have to pay for, but it uses the envelope method. Very good approach for saving money and has the typical reporting capabilities. It's just really nice to have the automation of it all.

Just out of curiosity what would be a good % to save on IB analyst base salary and the bonus?