This is a guest post from Kristy Ramirez.
Every month that bank statement comes in – either making us proud, or really disgusted! Sometimes the money just goes out just as quickly as it comes in and when you actually look over that statement do you cringe, or do you celebrate!
Where you spend your money can tell a lot about a person. Do you eat out regularly? What about emotional purchases, or unplanned spending? Does this happen enough to give it consideration?
We are supposed to be good managers of our money, as most of our parents say, “Save your money” don’t spend it frivolously. Times are hard, and you should always be frugal… all of the things we know we’re supposed to be doing, but most don’t.
It’s time to take a look into your own spending habits – granted, if your bank statement shows that nearly all of your money went to food, utilities and household bills – you’re likely doing it right. But, if you’ve got money left over every month, are you saving it, or spending it?
Everyone should have an emergency savings account for those little things that come up, like a broken water heater or a leaky roof. If you don’t – then it’s time to start saving. The nest egg is one of the most financially secure things you can do for yourself and your family.
This is the single most important item when trying to save or cut excessive spending. Start with a monthly household budget and figure out just how much disposable income you do have. If there is enough left over, start a savings, CD, TD or retirement account. The trick is to post that budget list somewhere in the house, where you see it daily, and stick to it.
Needs or wants?
Every time you shop, or pass a store ask yourself this question – do I need it, or do I just want it? The sooner you distinguish need from want the better off you’ll be when that bank statement rolls around the following month.
Use a list
When shopping, the best way to avoid over spending is to make a list of the items you need, and stick to that list religiously.
If you see something you want, write it down, and add it to the next shopping list, as long as it is in your budget.
As soon as that paycheck comes in, take a small percentage of that money and pay yourself. Some people take 10 percent right off the top and stash it into a savings or retirement account. This payment should be added to your budget.
Wait to buy
Technology is continually upgrading and changing, sometimes it seems like weekly. And when you see the latest smartphone, iPad or other big-ticket item, do you normally just buy it?
Here’s a suggestion: Wait 2 days before you do. It’s called a ‘cooling off’ period and most times, you’ll realize you don’t need it after all.
If you have a sufficient cell phone, a decent car, a nice television and computer that are working and serving their purpose – do you really need the newest technology?
Finally – stay at home more – make more meals at home, eating at home is much healthier because you know what the ingredients are, and it allows you to cook organic and manage what your family eats. Watch movies on that expensive television set, with that high dollar cable service.
Exercise at home – or take walks or hikes with family rather than pay for a costly gym membership.
Start thinking about ways you can cut back, and before you know it, your nest egg will have grown enough to start that college fund, or long awaited retirement account.
Kristy Ramirez is a frugal debt free mom who manages the family budget.