Some Easy Ways To Budget
- Identify your Income and Expenses:
Begin by listing all sources of income. Then list your fixed expenses (those that don’t change) and subtract from your gross income. This list will include such things as your mortgage, rent, credit payments, insurance, taxes, etc. The remainder is ‘variable’ expenses which will include things like groceries, eating out, entertainment, clothing, auto expenses, etc. - Lower Unnecessary Expenses:
A close analysis of your spending should reveal several places where you can reduce spending – areas like TV Cable (multiple channels), Caller ID, Call Forwarding (how many times do you use that one?), magazine or newspaper subscriptions, etc. When is the last time you reviewed and
compared home, auto and life, insurance rates? Can you transfer a current credit card balance to a lower rate one? Make a list of each area where you THINK you can reduce expenses. - Keep Track of Your Spending:
For one month, keep track of every cent you spend, no matter how minimal. At the end of the month, review and note areas that could definitely be eliminated. (Starbucks, fast food, entertainment, impulsive purchases, new clothes you don’t need, snacks, sodas, buying lunch rather than bringing something from home, etc.) Be aware of the difference between “I want” and “I need”. - Money-Saving Ideas:
- Grocery shopping – buy and cook in bulk. Freeze separate meals, then thaw and serve. A crock pot is a life-saver on this option!
- Check sale ads (or online) for anything you are going to buy – then decide if it is cheaper to go to the store with the lowest price, or if the difference in gas would eliminate the price differential. Remember if you purchase online, you usually have to pay the sales tax PLUS shipping and handling charges. Don’t forget to take those charges into account.
- Consider going on a “cash diet” for a few months – lock away all those credit cards – or only use Debit Cards so you have to have the money in the bank in order to use them.
- Shop around to see if your area offers choices on utilities like gas and electric. Ask for a home energy audit from your electric/gas supplier. You would be amazed how much money you can save by following the advice from one of these audits. Many of these companies will upgrade your light bulbs to energy-saving ones, and will give suggestions for many other ways to save energy as well as money.
- Find an alternative to driving everywhere. Owning a car is expensive. Why not carpool take public transportation if available, walk or ride your bike. A side health benefit is that you will probably lose weight, lower your blood pressure and see the world at a slower pace! (Not to mention the money you will save!)
Become determined to work with these guidelines and within a relatively short time you should begin to see some positive results.