Cutting back on your expenses and reducing what you spend should be an annual or even biannual task. Expenses and budget are two variables that change over the course of the year; grab them by the reins, dig your spurs in, and take charge.
Paradigm Shift
Periodically, step back from your bills, for just a moment, and look at all your finances from a different perspective. Organize all your bills, credit card statements, and expenses into categories. Following a comprehensive and concise format. If you haven’t already, look at our blog titled, Assessing Your Finances. In this blog, we show you how to organize and compile all your expenses into a comprehensive and concise manner.
Modes of Reducing Spending
Once your expenses are in a format, you will be able to easily asses and understand them. Thus, making reducing your spending much easier. Look at our topics below, for ideas on reducing your spending, starting with the easy to do and simple methods.
Value Shopping
Shopping is one of the easiest ways to spend lots of money, all the while justifying each expense. Especially if you are shopping for groceries and daily necessities. Try buying products on sale, grocery stores usually price their brand name products lower than the other products. If you are looking for clothing, shop for clothes out of season. Most of the time they will mark down 50 to 25 percent off. Or you can shop at department stores such as Bealls, JC Penny, Marshalls, and Ross… Start looking for the best value now, and eventually, you will become an experienced value shopper and it will be a mindless task.
Cook and Pack your Meals from Home
Let’s think about this for a minute. The average cost of a coffee at the local coffee shop is $3, throw in a bagel and you are at $7 for breakfast. Typically lunch costs $10 if you don’t go to a sit-down restaurant. Dinner depending on if you go to a sit-down restaurant or order take out can be $15-$20 a person. Now let’s add that all up, on the low end you are spending $28 a day on food, and on the high end you are spending $37 a day. Per week, just on the food, you have spent on the low end $196, and on the high end $259.
- Make your own coffee instead of buying it
- Pack a lunch during the workweek
- Cook dinner at home and plan your meals for the week
- Buy groceries on sale
- Stick to Store brands or Coupons
- Buy in Bulk from Wearhouse stores
- Don’t be afraid of frozen: meat, fruit, vegetables
Reducing Entertainment Expenses
Entertainment is a luxury, not a commodity, and should, therefore, be budgeted as such. We work hard at our jobs, to put food on the table, provide shelter for ourselves and family, and do the things we enjoy. Moderating what types of entertainment, we spend our money on, and how much we spend, can drastically reduce our budget.
- Rent from RedBox instead of going to the theaters
- Save the theaters for big cinematic productions
- Purchase alcohol and tobacco products in cases instead of individualized
- Reduce intake of mood and state altering substance
- Save up for one vacation instead of going out every weekend
- Plan inexpensive trips: instead of a water park, go to a freshwater spring
Track Your Spending
I know this is starting to sound redundant, but it should track your spending, where you spend your money, and how much you spend. The more you are aware of how much you are spending, the less you will spend, and the more you can actively adjust your expenses and budget. Track your spending either, daily, weekly, or monthly.
Building a budget
Once you have really assessed and analyzed your expenses and income. Start implementing budgets and spending limits on certain expenses. Obtain an understanding of what works and what doesn’t. Build a budget you can stick with. Your budget should grow and change as your finances and life change. One budget will not work all the time, understanding how to manipulate and change it when necessary will set you up for financial success.
