If you’re seriously interested in learning to invest wisely, one of the best first “investments” that you can make is to examine your finances. Not only can you find ways to save money, but getting serious about your entire financial picture will make you a much better investor in the long run.

The first place to start, obviously, is your total indebtedness. Sit down with all your bills, make a list, and look at where you money goes every day, week, and month. Make a list of all your long term financial obligations, who you owe, how much, what your interest rate is, and how long it will take to pay it off at the current rate of payment. Then, make a list of your regular monthly expenses, such as utilities, food, clothing, etc. Finally, apply this to your total income for the month. How much do you have left at the end of the month? Do you have any left? Where can you cut corners? And, if so, how much will cutting back save you?

While some things may take considerable effort to change, like your mortgage, car payment, etc., other things can and should be examined very closely. One of the best places to consider other options is your credit cards. Are you making the minimum payment only, or are you paying above the minimum? What is the rate of interest that you are being charged? Are there any monthly or annual fees for carrying those cards? How long, at your current interest rate and monthly payment level, will it take you to pay your cards off? And, if you found cards with a lower interest rate, no annual or monthly fees, and cash back bonuses, would you be able to either pay the balance off much sooner, or save more money than with your current credit card companies? If so, then it’s definitely a good idea to shop around and consider a balance transfer to a better credit card company.

Another place to look for potential savings is your car insurance premiums. Has your rate continued to rise, even though you haven’t purchased a new car, added new drivers, or had any tickets, accidents, etc.? If so, get quotes from other insurers! It only takes a few minutes, and getting a quote doesn’t obligate you to changing insurance companies, it only allows you to consider your options.

Once you’ve examined your credit cards, car and homeowner’s insurance coverage, and other regular monthly payments, then it’s time to look at other, more easily managed expenses. Look at your utility bills, your cable bill, your phone bills (especially your cellular bill), and other services. Do you really need all those channels? Do you watch them all? What about your cell phone, do you really need all those minutes? Do you actually use them? Or are you running over every month, and paying extra? Simply changing a couple of elective purchases on your cable and phone bills can quickly add up!

And, finally, examine your receipts for the week. How much did you spend at the grocery store? The big box department store? How much money was spent on things you needed versus impulse buying? Do you shop from a list or do you just wander the aisles trying to remember what you need? If you are like most people, you will be shocked when you sit down and add up the amount of money that you spent on things that you didn’t actually set out to purchase. Just a minor change or two to your regular shopping habits can easily save you tens of hundreds of dollars over the course of a month or a year.

Sitting down with your weekly, monthly, and annual expenses can be an eye opening experience, especially if you haven’t been exceptionally diligent in tracking your spending in the past. However painful it may be, once you have actually examined your expenses, it’s much easier to find ways to save money, thereby improving your overall financial picture. And, once your financial picture begins to improve, you’ll have more money to pour into your investments, which will lead to even bigger returns and more wealth!