The Dumb Little Man blog has a suggestion for all of us who can’t help but feel the shameful pull of the drive-thru lane when we’re hungry or just pressed for meal-planning time. Every night, empty your fast food (or candy, soda, or other junk food) receipts into a jar by your bed. Then … Round that up to the nearest $10 and cut it in half. That’s how much you’ll spend a week from now on … Take that money and put it in a ziplock bag that you keep in your car. All your fast food will be paid for out of this fund, and when it dries up, that’s it until next week. This will force you to ration and make choices.
Personal Finance blog Funny About Money tweaks the concept of a “freedom account”—a single stash for irregular-but-common expenses like car repair and clothing—and comes up with targeted accounts. That means opening up a money market or similar small account for each kind of expense, based on how often it occurs, rather than track a bunch of expenses from a big fund. For example, I look to the irregular little surprises that can happen at any time (plumbing or car repairs, vet bills, etc.), annual expenses (car and home owner’s insurance, property tax, income tax), and long-term expenses (purchase of a new car, about once every ten years; major repairs or renovations on the house, which I hope don’t happen more often than about once every eight or ten years).
That way, the author states, big walloping expenses like car repair don’t throw off your budget and give you a clearer view at what you’re spending. Targeting your emergency savings [Funny About Money]
The Simple Dollar personal finance blog delves into household budgeting—something more of us should do, but are kept away from by fear of spreadsheets, math, and undue time commitments. Blogger Trent’s solution is simple and reliable, however, and takes only a willingness to collect paper and toss it in a shoe box. Collect one to three months’ worth of receipts, checks, pay stubs, and other paper records of money in and out, drop them on a floor when you’re done, and then arrange them however you’d like: You’ll probably find yourself shifting piles around and making new piles throughout this process, as you should. The goal is to find ways to group your spending that’s natural to you. Don’t try to force it to match someone else’s groupings – if a group of receipts or statements feel like a natural group to you, that’s how they should be sorted.
If you want to eat well while keeping within a budget, the Simple Dollar offers a few tips for making sure you shop well and don’t let any of your food purchases go to waste.Buying in bulk, getting fresh produce from farmer’s markets and cooking meals that work as leftovers are all good moves, but there are some traps to avoid too:
Don’t buy ingredients that only work for one dish – especially if they’re perishable. Double check the value of sale items or coupons – home brand items may still be cheaper Make one big supermarket trip a month, supplemented by small shops at markets for fresh produce. This will force you to get creative and use what you have on hand.The goal is to use up all the food you buy, rather than throwing out wasted food – which translates to wasted money. Makes sense. I’d add another tip – avoid shopping at supermarkets which like to prepackage foods into larger amounts than you really need. Coles is a big offender – it’s hard to buy smaller amounts of some meats and fruit and veg because they package them up in ‘family size’ containers.Got any tips for stretching your food budget further? Share in comments please.The Lazy Man’s Guide to Shopping on a Budget [The Simple Dollar]
The Simple Dollar doles out some advice for people trying to break the habit of spending all of pay cheque every month. It offers a simple plan for paring down some of your regular frivilous expenses and turning them into the start of a savings plan.
“Find things that you routinely spend money on and reduce them. Good places to look include any monthly bills strictly related to social activities (like country club membership or your cell phone bill) or entertainment (like Netflix or the cable bill). Look for things you don’t use – maybe you don’t watch the premium movie channels you’re paying for, or maybe you’re not utilizing Netflix as well as you thought you would, or perhaps you’re buying way too many text messages each month and aren’t using them. If you’re unsure about whether to cut something, cut it. You can always bring it back if you find that it was more useful than you thought.”
Then, add up how much you’re saving each month by getting rid of those expenses, and set up an automatic bank transfer from your primary bank account into a savings account. You’ve just set up a saving regime with the money you used to spend as disposable income. Nice!
Got any tips on how you got started with a savings plan? Share in comments please.Chipping away at the paycheck to paycheck routine [The Simple Dollar]
Last week we talked about coping when you’re the rich one in your social group who gets leaned on to pay – now the Simple Dollar blog has tackled the problem at the other end of the spectrum – how do you keep control of your ‘social spending’ when your friends have more cash than you? Here’s a few of their tips:
1. Explain your goals to your friends2. Suggest low cost or no-cost social alternatives3. Budget for social spending such as the weekly trip to the pub4. Be prepared to opt out of some of the regular activities if they’re beyond your budget.
And if the shoe is on the other foot?
“If, on the other hand, you’re financially well-off, be aware that your friends may not be in a similar position. Don’t suggest expensive activities. Don’t brag about money. Don’t flaunt it. Respect other people’s limits.”
It’s important to strike a balance between continuing to spend time with your friends, and being able to stick to your budget. How do you strike this balance? Tips in comments please.
Six Ways to Break Free of the Purge and Splurge Cycle [The Simple Dollar]
If you’re trying to live within a budget – especially if you’re trying to pay off debt or save up for a big purchase, it can feel like you’re scrimping all the time.
If you’ve ever fallen off the diet wagon you know that depriving yourself of something for long enough can cause you to splurge. Like dieting, when you budget you need to find ways to treat yourself while still sticking to the rules – otherwise you’ll splurge and ruin all your hard work.The Get Rich Slowly blog has some good suggestions for how to avoid frugality burnout:Cut yourself some slack. “If your budget is so tight that you feel deprived, you run the risk of giving up altogether. As long as your remain focused on you goal, it’s okay to take a break from time-to-time. Just don’t overdo it. (Buying a DVD is a good way to blow off steam; buying a new HDTV is not.)” Treat it like a game. “This is one of my favorites. I find that it’s so much easier to practice frugality when I make a game of it.” This was an awesome suggestion – here’s a couple of tricks I use: How much fruit and veg can I buy at the local farmer’s market for $20? How many unnecessary purchases can I weed out of my shopping basket?
Another one that works for me is finding ways to replace buying with borrowing. The obvious example is borrowing books from the library rather than buying them. I used to love requesting new releases from the library – sometimes there would be a queue of people waiting for the book, but getting a card from the library telling me my loan had arrived really was just as exciting as getting a note from Amazon saying my book had arrived.
Got any tips for enjoying life on a budget? Please share in comments.
As the last few days of 2007 slip away, make a New Year’s resolution to get your finances in order with Wesabe. A few months ago Adam kicked Mint’s tires. After giving Mint a whirl, I knew it wasn’t for me. With Wesabe’s plethora of features, open source mindset, and strong community backing, it’s the perfect money management app for my needs.
Get your expenses in order before the holidays with free ebook Within Your Means: Financial Planning for Hidden Expenses. Writer Michael Ham rolled an ebook and an Excel workbook together into one hybrid financial management tool. In addition to learning about implicit and explicit costs, you interact directly with the workbook by entering your income, expenses, and goals. A series of interrelated Excel formulas slowly molds a snapshot of your current financial situation. An Excel workbook to help you create a budget that recognises not only your explicit expenses (rent/mortgage, utilities, groceries, auto insurance and registration, and the like), but also implicit expenses: the money you implicitly spend by gradually wearing out things you must replace (car, tires, mattress, TV, furniture, and the like).
I spent an hour going through the workbook earlier this week and was pleased at how well the workbook complemented traditional financial software like Quicken, Money, Wesabe, and Mint.
Within Your Means: Financial Planning for Hidden Expenses [Leisureguy's Storefront]Track your spending via SMS, email, IM, or voice (via Jott) with web application Xpenser. After you sign up, you’ll need to set up your account with your IM and SMS information and set up Jott to use with Xpenser (if you want to do voice tracking). After you’re all set up, adding expenses to a report (you can create any number of reports and set a default for new additions) is as simple as, for example, texting something like “exp lunch 35.4 with Jack, Jill” to Xpenser. If you’ve ever had trouble keeping up with your expenses for the month, especially if you need to track your business expenses, Xpenser aims to be a simple, universally accessible solution for getting your expenses recorded as soon as they happen (it’s like a super-charged version of my BudgetBot).
Xpenser
