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.
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!