finances 22

In our everyday lives, there are times when it becomes really necessary to put our expenses in check to avoid finding yourself in a financial mess. Really, it does not matter how much you earn because as your income increases, so does your expenses. There is a saying that goes ‘More money, more problems’.  This is where budgeting comes in, to help you align your expenses with your income while having some savings at the end of he day.

You may refer to my other post on Managing your Finances-Money to get more details. Are you having a hard time making a budget or sticking to it? Here’s our round-up of the best tips and tricks for budgeting:

  1. Don’t spend more money than you have.
  2. Stick to your grocery lists – compile them based on an itemized overview of your household needs and never stray too far from it.
  3. In a similar vein, never go grocery shopping hungry! The hunger makes you crave for almost everything edible,
  4. Keep your receipts, or write your own – at the end of each day, list your expenditures. At the end of the month, group those expenditures to create a simple overview of where you’re spending too much or even too little.
  5. Pack your lunch to work every day or most days in a week. This will help you save a lot of money every day of the each year.
  6. Do not eat out. You save a lot of money by cooking your own food.
  7. Talk yourself out of purchases before incurring them. Ask yourself, do I need this? Think of various ways you can avoid a purchase that may seems necessary at the moment.
  8. You don’t need the $100 shirt from the pricey store when there’s a $10 equivalent at the thrift store. You don’t need a room-sized plasma TV when a smaller one will do just fine or your old CRT still works.
  9. Remind yourself frequently of your financial goals, especially when you’re at the mall: paying off a big debt, retiring early, starting up your own business. Remind yourself that by living frugally, you’re at least in some small way helping the environment.
  10. Use cash or your debit card. Take money out of your account and use real cash from a real wallet to pay for your daily expenses. When you run out of bills, you run out of money to spend. However, be careful so you don’t lose big money over the course of the year in spare change spent on coke, snack and petty expenses.
  11. Avoid using credit card so you do not accumulate debts that would take you ages to repay without realizing it. if you have to use a credit card, endevour to repay within 48 hours to avoid interest accumulation.
  12. If you have a use a cable TV, switch for the subscription plan that will be fair to your pocket. It does not make sense subscribing to so many channels that you may never even watch.
  13. Sleep on your purchases. Give yourself a night to consider and rationalize before buying a new toy, and if you rationally decide you need it, you can go back and get it.
  14. Review your budget and spreadsheets regularly. Keep your financial situation constantly fresh in your mind. This helps to curb your desire to spend, spend, spend, ensures you know how much you actually have to spend if you need to, and motivates you to pay off debt and save more.
  15. Use spreadsheets if necessary – or use Google Docs for spreadsheets and you can even save on overpriced office software.
  16. Use every last scrap of every last thing you purchase. Don’t waste anything. Don’t leave taps running, don’t throw out the quarter of a plate of dinner you didn’t eat.
  17. Become a power Nazi. Switch off lights and appliances at every opportunity, and tweak your computer’s power settings to give you the optimum balance between power savings and practicality.
  18. Think about money philosophically – consider your spending behavior as a reflection of who you are. If you would not like to be defined by your purchases of cigarettes, hard liquor and pork rinds, reconsider and make better purchases that reflect the person you’d like to be.
  19. Respect money like you do your family heirloom; that which you respect, can’t be hastily thrown away. It’s not about how much you make, but how much you save.
  20. Exercise in the great outdoors, or use your own body weight – forget expensive gym memberships and personal trainers.
  21. Diligently organize rebates and send them in on time, every time.
  22. Do extensive research before all purchases, especially impulse purchases. Find the best price online or off, even if it’s “almost new” from eBay.
  23. Do extensive research not only on price, but on durability and quality; buying everything from you see or find interesting is a bad decision as far as your long term savings go.
  24. Don’t fall for the vicious technology upgrade cycle. Your laptop is still fine until there’s something actually wrong with it; performance is all in the software you run. Do you need to be running Vista or Leopard or the latest version of Photoshop? For most people, probably not. Wishing for more drains what you have.
  25. If you come under your budget, save the excess. There is no legal obligation to spend it!
  26. Pay yourself first. Take 10% or so off the top of your income and save it before you even start paying bills.
  27. Base your meals on cheap, but nutritious food sources including fresh produce as they are healthier even though they get bad quickly all the time. You may also buy items like rice, beans and other basic food stuffs in bulk.
  28. Preventing an impulse purchase with this motivation hack: simply think about how many hours it took you to earn that amount.
  29. When keeping track of credit card purchases, put them into your cheque book as soon as the transaction occurs. That way the cheque book will always have as much money as you actually have, letting you freely pay off your credit card when the time comes.
  30. Don’t keep credit cards or debit cards in your wallet, or near any of your computers with an Internet connection.
  31. Water is cheap and can easily replace most other beverages, such as soda or artificially flavored juices.
  32. Borrow books from your library, don’t purchase them. This puts an imperative on you to actually read your books (how often do the ones your purchase just sit on the bookshelf?) and saves huge amounts of money if you read a decent amount.
Read also   Saving With Your Small Income

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