Mo’ Money, Mo’ Problems, but…

not having enough is not a good plan either.  So, with that in mind, I sat down the other day with several months’ worth of credit card bills and my diligent financial records (ha!) to evaluate our current spending habits.  (Remember the last time I did this?  It’s been a while…)We’ve always considered ourselves to be pretty frugal, but with my salary getting chopped to a sliver next year, I was looking for even more ways to trim up our bank account.

Most of our monthly expenses are fixed: insurance, rent, utilities, etc.  Not a lot of wiggle room there, although we’re shopping around for some better deals in a couple of areas.  But  my main focus was the credit card, which is where almost all of our discretionary spending shows up, since neither of us carry much cash.  Our budgeting strategy up until now has been something like this:

1.  Don’t spend too much or too often.  In general, say “no” to purchases, unless they’re REALLY needed or you REALLY want it and it’s not that much money.  Say “no” more often if you know we’ve had unusually high expenses (car maintenance, purchase for the house, or extra splurges on baby decor).

2.  At the end of the month, look at the total of the credit card bill.  If it’s above $X (an arbitrary amount that I came up with; loosely based on our average spending), we resolve to spend less the next month.  Whether the bill is a little over or a little under our target, always pay off the full balance.

3.  Repeat next month.

So, like I said, I sat down with our credit card statements and itemized a few months’ worth of expenses.  I found a couple of slow leaks– eating out (low dollar amounts but frequent purchases- indicating that it’s not even “going out to eat,” but each of us eating on the run) and big mysterious charges at Wal-Mart and Target.  Of course, it’s impossible to remember what in the world I was spending money on here!

So after hours with my calculator and my little homemade spreadsheets on a legal pad, I came up with some new money habits that I’m convinced will add up to big savings.  They’re so elementary, I’m embarrassed to even admit that  they’re going to revolutionize my spending, but I suspect that they’re common mistakes that most of us make.  Here are my ideas so far, and feel free to add your own tips!

1.  Stephen and I each get a monthly allowance.  We have to keep a record of our personal spending and we’re not allowed to go over or borrow from the next month.  This money is to be used for eating out (without the other person), clothing, books…basically anything that benefits just the spender.  I already know that most of my allowance will go to my nails.  I’m at peace with the fact that that means fewer trips to Starbucks for me!  Turniphead also gets an allowance that I get to spend for baby needs.  If any of us has a surplus at the end of the month, yes, it rolls over!  This way we can save up for big purchases if needed.

2.  I also created spending categories for groceries, gas, and “spending.”  Basically this last category is my catch-all…but it’s got a strict limit.  So if we have to spend a lot in a month for birthday gifts or oil changes, we have less to spend on going to the movies or new lamps for the living room.

Beyond budgeting…

3.  Plan meals and make a shopping list before going to the store.  Plan meals around re-using perishable leftovers or ingredients currently in the refrigerator.  Knowing our lifestyle, I’ll probably plan only a few days in advance and go to the store twice in a week.

4.  Carry lunches and snacks from home.  Avoid unplanned fast-food runs!  This will save CALORIES as well as money.

5.  Avoid Target and Wal-Mart.  When I do need items from these stores, go in with a specific list and DO NOT BUY ANYTHING THAT IS NOT ON THE LIST.  This is a common story- I go into Target for detergent and a storage basket for baby toys.  While I’m in there, I walk all over the store and am reminded of several other things I “need,” or I talk myself into a really cute shirt or purse that’s on a great sale.  I hardly ever come back out of the store having purchased only what I went in for.

6.  Read books I already own before going out and buying more, even if they are on the bargain rack at B&N!  Use the library if necessary for more free titles (remember to return on time!).

7.  Watch movies I already own before going to the RedBox and renting a new one.  When I do use RedBox, remember to return on time!

8.  Plan out errands before leaving the house and drive efficiently; not lots of doubling back and forth across down.  Try to only make one big errand run per day.  Be especially thoughtful about trips to Killeen and Waco since they’re more of a gas investment.  (I’ve started getting up earlier on Sundays so that I can ride to church with Stephen rather than taking my own car–it gets me there WAY too early for my taste, but it saves us lots of gas!)

9.  Try to make food products at home rather than buying prepackaged.  It can often be more healthy and a small savings.  I’m very new to this…but last week I made my own chocolate syrup and it was good!  I did not have to buy any special ingredients and my own creation does not contain high fructose corn syrup. The “simple” blogs I mentioned earlier are really good for ideas and recipes for homemade varieties of items that I usually buy premade.

10.  Go through stash of gift cards that I’ve been accumulating for YEARS.  Yes, you heard me right!  So I’m trying to plan eating out or shopping at these places to use them up.  Hey, it’s already been paid for, and I don’t have to deduct it from my allowance!

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4 responses to “Mo’ Money, Mo’ Problems, but…

  1. I have been using Mvelopes. It is cool. Check out their website http://www.mvelopes.com . There is a monthly fee, but it has been worth it to me to do better financially. (If you, or anyone else, decides to start using it, let me know, I can buy you a gift card and you will save A LOT!) I used to use Quicken to track our spending, but it didn’t really help.

  2. I love the allowance idea. We call it “play money.” It helps keep us from feeling deprived when we say no to things, knowing there is a small amount that can be spent anyway we want.

    I also try to make at least one meal a week composed of leftovers. Pizza is a good way to use up leftover veggies and meat, as are pasta dishes.

    When I decided to not buy something, I throw that amount in the money jar on my dresser (to be used deposited into savings eventually) or transfer it to savings, regardless of how small (like deciding I wouldn’t starve before I got home to eat lunch).

  3. On that early trip to church, don’t forget to factor in the Starbucks. Also, you can always ride with us. 🙂

  4. I used to do the same thing at wal-mart and target! But recently I’ve changed my habits. This is my new rule. – I wait until I need about 5-10 things from wal-mart or target. Then I put them on the list, and go only when I can’t put it off any longer.

    This works for a couple of reasons. 1) I am so focused on getting the items on my list, that I rarely have time to “browse” and add junk to my cart 2) by the time I am done getting the items on my list, I am already thinking about the money I am about to pay for those 5-10 items. Then I am less likely to add unplanned purchases to my cart. If I go into target here and there to pick up one or two items, I end up spending more on other random items. I somehow justified the unplanned purchases, by thinking…”I’ll still get out of here for under 50 bucks…no biggie…”

    So now when I face unplanned purchases, I have the will power to abort. I guess I am a pro-choice shopper now.* I don’t let Target or Wal-Mart Marketing VPs control my mind anymore…

    Horrible metaphor, I know, but I couldn’t resist…

    *I am pro-life. Do not hate me, please.

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