Week 6 of Budget 101

Part 6: Save on the Special Things

Vacations.  Birthdays.  Holidays.  We know they’re coming, and yet it is so easy to blow our budgets just because “it’s a special occasion.”  If you’re still with me after all this time, you should be starting to feel pretty good about your budget.  After all, you’ve been able to make a distinction between your wants and needs, you’ve set a budget for yourself, and hopefully found ways to save some money on the big things (like housing & insurance), the necessary things (like utilities & groceries), & even the fun things (like shoes and wine!)

(NOTE: Before we go any further, if you are new to my blog or missed out on the last five weeks, you might want to start at Week 1 of Budget 101 before starting this week’s assignment!)

If there is no leeway in your budget for those things that only come up once in a while, you may find yourself seriously strapped for cash when the time comes.  Since holidays, birthdays, & vacations are terrible times to be worried about money, it is best to plan ahead.

This week’s assignment:

Keeping your online buying hidden

1. Set a Special Occasions Budget.

Sitting down and actually writing down how much you can afford to spend is a giant step towards saving money in this area.  Too often we get caught up in wanting to “splurge” for something special, but those splurges can catch up with us!  After all, there are a LOT of special occasions throughout the year!  By looking at them as a whole, rather than a once-in-a-while thing, it is easer to see the big picture.  It is also easier to set limits for ourselves when we are not caught up in the moment!

2. Find ways to save throughout the year.

I realized during my college years that coupons DO work. The key to saving lots of money with coupons is to buy things when they are at their rock bottom price, then stock up for when you need them.  This method of shopping has easily been carried over to the rest of my life, and has saved me a lot of money in the long run.

The more you plan ahead & buy things when they are cheapest, and not when they are most convenient, the better off you will be.  Stock up on items for the next year in the post-holiday clearance sales or buy toys & other gifts in bulk when you find a great special.

You can also keep in your purse or wallet, a list of people or occasions you know you will need to buy gifts for in the next year. Make sure it includes how much you have budgeted to spend.

3.  Be on the lookout for good deals!

Once again, this is more of an ongoing assignment, and once again keep in mind there are always going to be more bargains available than you can afford to spend. Stick to the list and to your budget. Last week I listed several of my favorite places to score great deals; those same places apply here.

4.  Shop around & compare prices

This almost goes without saying, but is especially important when you are booking vacation travel!  Because prices fluctuate so much, there are no hard, and fast rules about where to find the best travel deal.  The only constant is that prices change a LOT, so shop around!

If you are traveling to a specific destination, be sure to price out all your different options, and to check a variety of travel sites before you book.  Don’t assume that package prices will be cheaper–sometimes they will and sometimes they won’t– be sure to check smaller, independent airlines in addition to larger travel sites when booking flights.

On the other hand, if you just want to get a great deal on a vacation but aren’t too particular about where you go, you may want to check out some of the daily deal sites like Groupon, Eversave, Totsy, & Living Social that offer vacation deals.  Additionally, Jet Setter is a daily deal site that exclusively offers high end vacation deals for a fraction of the normal price.

5.  Start Working On Handmade Gifts

Consider handmade gifts for as many people as possible.  With more time to plan, you also have more time to put together something really special.  Even better, those gifts will probably mean a lot more–it truly is the THOUGHT that counts!
Even if you’re not that creative on your own, the internet is full of amazing handmade gift ideas.
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And that’s all for this week!!!!! Stay tuned for next week’s saving challenge next Sunday.

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Week 5 of Budget 101

Part 5: Save on the Fun Things

Finally, a topic that we actually WANT to think about.  Or maybe that’s just me! 🙂 Saving on the all the things we MUST spend money on, is in all actuality as important as tedious, to say the least.

(NOTE: Before we go any further, if you are new to Through The Eyes Of I, or missed out on the last four weeks, you might want to start at Week 1: Stop Spending before starting this week’s assignment!)
 

If we’re being perfectly honest, which of these two scenarios would make you do the happy dance:

a.) You were able to negotiate a .3 percentage point drop in your mortgage rate

b.) You found the cutest pair of designer shoes that ever existed on clearance for 90% off AND you had an additional 10% off coupon AND the only pair left was in your size.  It was like the heavens opened up and the shoe gods named you the Chosen One.

(Hint: If you picked (b), this might be the wrong guide to savings for you.)

But there is a very important distinction between (a) and (b).  The first scenario is an actual savings–additional money in your pocket that would otherwise be gone.  The second scenario, while a “good deal,” is NOT really saving you any money.  Those perfect shoes will still cost you something, even if it is far less than the original price.

You are spending, not saving.

Last week we methodically tackled saving on all those pesky things we have to spend money on each month–food, utilities, & gas–whether we want to or not.  Hopefully once you started looking, you found that there were plenty of tweaks you could make to squeeze the most out of your budget.

This week we are going to focus on saving money on the things we want to buy, but don’t necessarily need to buy.

Remember the exercise from Week One? Well let’s face it, although the most obvious answer to saving money in this category is simply to stop spending money on things we don’t need, it’s probably not a very realistic option for most people, including myself.

So what’s a girl (or guy) to do?  As hard as it may be (especially for those of us who want instant gratification), there is a very simple way to save on everything you buy:

Wait for the best price.

Everything goes on sale eventually, it is just a matter of being patient. It is such a simple concept, and yet so hard to follow sometimes for many people.

This week’s assignment:

  •  Stop shopping mindlessly.

If this one doesn’t apply to you, feel free to skip to #2, but for some of us (and WE know who WE are), shopping is more than just a means to an end, it is how we fill our time. Regardless of how much we try to convince ourselves that we’re “just looking,” or “window shopping,” eventually the temptation becomes too great, and we buy things we not only don’t need, we end up with things we don’t even really want.  No matter how good the sale, if we buy something we don’t need OR want, it isn’t a good deal, and we are NOT saving money!  Save your pennies for the things you want, and find another way to fill your day! We do not want make any more poor decisions.

  •  Figure out what you really want

Make a list of all the things you want to buy.  Clothes, shoes, new TV, car, blender, professional family portraits, house, new couch, etc. Next to each item, indicate how soon you want/need it, (i.e. “sometime in the next 5 years,” “for my cousin’s wedding next week,” “this October.”), as well as how much you want to spend.  The goal is to aim low, not high, giving yourself a goal to shoot for and a reason NOT to spend more than you have to.  Try to limit your list to no more than 10 items at a time.  If something doesn’t make your top 9, then you probably don’t want it that badly!  Save your money for the things you truly want.

  •  Be on the lookout for good deals!

This is more of an ongoing assignment.  Wish list in hand, you are now free to search for bargains.  But BE CAREFUL.  There are always going to be more bargains available than you can afford to spend.  Stick to the list and to the things you really want.  Diligence truly does pay off, and if you continue looking, you will almost always find what you want at a price you like.  The internet and the use of apps are almost an endless source of bargains, but here are some of my favorite places to look for deals:

Amazon Gold Box –I have found some of my best deals this way. There are Deals of the Day and Lightning Deals which often feature products for 75% or more off the regular retail price.  Even better, you can sign up for Amazon Mom (for free!) and get FREE 2 day shipping on almost everything including 20% off diaper subscriptions.

Amazon is also one of my favorite places to find great deals. You can find almost anything, and if you sign up for Amazon Prime, you get access to thousands of movies, and music for free and the ability to enjoy FREE 2 day shipping.

Ebates– If you do any online shopping at all, using Ebates to get cash back on all your purchases is simply a no-brainer. However, Ebates also frequently features “Daily Double” specials that can mean huge discounts on a wide variety of items.  When you Sign up you will automatically receive their daily email, which is a great way to keep track of the specials!

  • Daily Deal Sites – More & more of these deal sites seem to pop up every day, but my favorites thus far are Beyond The RackGroupon, and Zulily.
Target Online Daily Deals– who doesn’t love Target?  Their daily deals are often nothing short of amazing AND shipping is free!
Craigslist– I have found some amazing deals on Craigslist, but usually only after a LOT of searching. I have the most success when I am looking for something specific, and then search daily until I find it. Don’t be afraid to negotiate either, even if the price is low. Unless it’s free, it can always go lower!

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 See, wasn’t this week a lot more fun?  (That’s because shopping under the guise of “saving money” is always more fun than cracking down!)  Stay tuned for another week’s saving challenge next Sunday, and don’t forget to let me know how you’re doing!

Week 4 of Budget 101

PART 4: SAVE ON THE NECESSARY THINGS

If you’ve made it this far, you’ve probably come to the conclusion that getting your financial life in order is hard work!  I wish I could say it will be a cakewalk from now on, but alas, there is still much to be done.  Don’t let that discourage you or make you give up.  If you are feeling overwhelmed (a perfectly normal reaction), then just stop, take a deep breath, and give yourself a break.  Wait a week or two to pick up where you started.  This series will be here for you when you’re ready.  I promise you CAN do this, and it’s okay if it takes you longer than 8 weeks to get there.
(NOTE: If you are new to “Through The Eyes Of I” or missed out last week, you might want to start at Week 1 of Budget 101 before starting this week’s assignment!)
Last week we focused lowering our major expenses–housing, transportation, & insurance.   Hopefully you were able to find a few ways to save, and if so, YAHOO!    If not, take heart, there are plenty of other areas left to save.
This week we are going to focus on lowering your expenses for the necessities in your budget.  Do you remember the exercise from week 1, where we focused on separating our wants from our needs?  Well, this is where that comes into play. There are certain things we simply can’t live without– groceries, utilities, gas –but we most likely CAN pay less for them.

For those of you who don’t want to bother with coupons, there are still many ways to reduce your grocery bills simply by changing the way you shop. It doesn’t have to be all or nothing. ANY savings is better than none!

Unless you have already been trying to cut your expenses in this area, your utility bills should be one place you can find lots of opportunities for savings!  Small tweaks can make a BIG difference in your final bill, and if you are anything like me, you probably have a whole pile of utility bills to deals with each month–everything from water to electricity, cable to phones,  the list goes on and on, and seems to get longer all the time.

Gas is a hard expense to cut significantly. We obviously have no control over gas prices, and we usually need to travel where we need to go. But there are a few things we can do to make sure we are making the most of our gas mileage, and again, small tweaks can make a big difference over time.

This week’s assignment will be pretty straightforward.  We’re going to methodically go through those things we MUST spend money on, whether we want to or not, and then look for ways to cut those expenses.  A little here, and a little there really does add up.

This week’s assignment:

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1. Develop a strategy for saving on your groceries

If you are already saving money with coupons, great!  Look for ways to stretch those savings even more, perhaps by committing to a few meatless meals a week or by getting more proficient at “shopping” and cooking from your own stockpile. If you are not using coupons and don’t want to, there are still a lot of ways to reduce that grocery bill by planning your meals & shopping list around what’s on sale, and stocking up when you find things at a great price.

2.  Reduce Your Utilities

Make a list of all the utilities you pay each month, and make an active commitment to reduce each one. For instance, you could commit to reducing your electric bill by setting your A/C a few degrees lower and by turning off the lights during the day (and keeping them off.)  You could decide to eliminate your landline in favor of cell phones, downgrade your cable plan, or switch internet providers.  Remember, every little bit helps, but whatever you decide to do, WRITE IT DOWN!  Then do it!

3.  Commit to Saving Money on Gas

Once again, be specific.  Write down at least 5 things you can start doing right away to help lower that expense every month, whether it be planning your errands better to make them more efficient, carpooling, walking when possible, or even checking to make sure your tires are properly inflated. That’s all there is for this week.  That wasn’t so bad was it?  Compared to all the big stuff, it was a walk in the park, and maybe it was even a little fun!  It is amazing how much money we literally throw away each month, just because we don’t pay attention to the details in all these different areas.  It really does add up.

 
Stay tuned for another riveting installment next Sunday and don’t forget to let me know how you’re doing!

Week 2 of Budget 101

PART TWO: MAKE A BUDGET

It’s been a week.  How’s that no-spending thing going? Well, here’s the good news:  You can start spending money again.  Of course the bad news is that after today’s assignment, you might not want to. Hopefully last week’s exercise started you thinking about the reasons WHY you’re spending and also got you to start making a serious distinction between the things you WANT and the things you NEED.

(NOTE: If you are new to “Through The Eyes Of I” or missed out last week, you might want to start at Budget 101 Part 1: STOP SPENDING before starting this week’s assignment!)

Before we go any further, I want to make a quick but important distinction that just because something is a “WANT” instead of a “NEED” doesn’t make it wrong or bad. It’s okay to want a pretty comfortable house with all the amenities, vacations or cute shoes. What’s not okay is to want all those things at the expense of your financial well-being,  your marriage, relationships, your children or anything else that we know is more important than stuff. It’s okay to WANT, but not to GET if you are not at a stable financial stance to do so. ***Don’t go on vacation, then come back and not pay your electric and gas bills. Don’t go out shopping with your friends and then go and tell your family you’re struggling*** If you are not struggling with your spending or find that you have plenty of money leftover for your savings, life & retirement accounts at the end of the month, have no trouble paying all your bills on time, know exactly where all your money is going, have great credit and don’t stress out over unforeseen expenses, then you probably don’t need to be reading this series.  In fact, you probably could write it better than me because you are obviously doing something right. I have multiple bills including a retirement and savings account, life, funeral and health insurances that I pay towards monthly, and I don’t have school or credit debt so I say I am pretty financially stable BUT…… most of us, including I struggle with money or budgeting, at least in some area. Believe me when I tell you there is plenty of room for improvement. This week’s assignment is going to require a little more effort.   The hard truth is that no one can fix your budget for you.  There are no magic solutions or ten-minute fixes that will have permanent results.  Improving your financial outlook will require change, and change is HARD.  Do it anyway.

As I tell my stepson, never neglect to do something just because it is hard, because it is the things you work hardest for that will reward you the most. Don’t let fear stop you either. It can be very scary to open up the Pandora’s box otherwise known as your finances, especially if you’ve been turning a blind eye.  In some ways, ignorance is bliss.  But if you’re still reading up to this point, you probably know, deep down, that this is something you need to do.  Take a deep breath, muster up your courage, and just do it.  You’ll be better for it. And now that the pep talk is over, it is time to get down to business:

HERE IS THIS WEEK’S ASSIGNMENT:

                      CLICK TO DOWNLOAD MY PERSONAL BUDGET WORKSHEET

1. Assess your income and fixed expenses

Print out the nifty budget worksheet above, then grab your bank statements, your bills, your check register, & any other financial information you can think of.  A calculator might come in handy too.  Then grab a glass of wine, sit down (with your spouse if your married), and start crunching the numbers.  Use worksheet number one to list all your sources of income, as well as all those key fixed payments you MUST make each month

Use worksheet #2 to add up all the subtotals of your fixed expense categories, then subtract that total from your income.  The remaining number is what you really have to work on creating a budget for.
In the coming weeks, we will work on finding ways to lower both your fixed AND variable expenses, but we need a place to start from, and this is it.

2.  Create a budget for your variable expenses

Use a pencil to fill in each category with what you are currently paying each month, then add up your subtotals and see how it compares to the number you are shooting for.  Then go back and lower different categories as necessary.  Obviously some things, like your water and electric, won’t be adjustable, but other things can probably be cut significantly.   Include SOMETHING in your savings budget, even if it is just a small amount.  If you have credit card payments, include those in your household expenses as well.

3. Take some time to self-reflect

This step may be the hardest, but it is also the most important.  Complete worksheet #4 and make some concrete decisions and goals based on what you’ve discovered through this budgeting exercise.

Maybe you’ve realized it is time to cut up your credit cards, or, at the very least, put them on ice. (Fill a bowl with water, put your credit cards in, and freeze.  If nothing else, it will slow you down!)  Maybe you’re ready to start packing a lunch instead of going out or to give up cable.  What you spend your money on is a very personal decision that only you can determine for yourself (or with your spouse.)

4. Track your spending

The last page of the PDF packet is an expense tracker.  Print out as many as you need, and use it to keep track of everything you spend.  At the end of each day, and then again at the end of each week, go over your expenses to make sure you are staying on track.  The more frequently you “check in,” the less likely you will be to let your spending get out of control.  Little things add up quickly!

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Whew, what a week!  I know this probably seems like a lot, but please don’t give up on me!  I promise it will be worth it in the end, and your bank account will thank you.  Stay tuned for another riveting installment next Sunday and remember, I want to hear from you!  How did your first week of the challenge go?  What did you learn about yourself or your budget?
Keep in mind, once again, that I am not a financial expert.  You are welcome to use these worksheets to help you–they are what make sense to me–but there are lots of other budgeting books, worksheets, & software available that might work for you better

About Budget 101

My goal for this series is to guide you through a series of assignments intended to put you on a sounder financial footing.  Basically it is eight weeks to a better budget. It is my personal guide, a beginners budget 101. Each week we will tackle one specific area for us to work on, and then complete assignments related to that segment of our financial life. Keep in mind, just as anything you need to do in life, following this series will take some effort & commitment on your part. There are many ways to budget your financial life, and this is the blood, sweat, & tears edition. Okay, well maybe no blood 🙂 Every Sunday will mark a new week towards a better budget. Come join me and save! Click on Budget 101 in the menu scale, and use the drop down to view the series by week.

Disclaimers: 

  • I am not a financial expert or certified financial planner.  I have degrees in business administration, criminal and business law, have studied accounting, and am a certified tax preparer and tutor.  I have no credentials whatsoever beyond my own experience to qualify me for teaching anyone about saving money.  There are plenty of money experts out there who could probably explain this stuff far better than me, and some I will even refer you to.  My only goal here is to try to break down the scary world of budgets and saving into manageable bites.  Yes, this is the baby steps guide to saving. This is my personal guide, and it has worked for me.

Week 1 of Budget 101

Welcome to My Beginner’s Guide to Saving!

My goal for this series is to guide you through a series of assignments intended to put you on sounder financial footing.  Basically it is eight weeks to a better budget. Being that you are reading this, you are starting a lifestyle to a better you, and  better financial situation.

Part One: Stop Spending!!!

Saving is not easy. We live in a crazy consumer driven “have to have it” society, where the latest electronics, cars, fashions and cars are constantly being promoted; and we are made to feel like we’re missing out if we don’t have the latest or the best.  The sheer quantity of stuff available to purchase at any given time is pretty much a bottomless pit.  There is always more, more more! So we want and spend more, more, more!

So what’s a girl (or boy) to do?

Well, it’s pretty simple really:  STOP. BUYING. STUFF.

At least in theory it is simple…….

In practice, it is sooooo much harder……

Our reasons for spending money on stuff we don’t need are plentiful and varied.  It makes us feel good.  We want to look better.  We want our house to be pretty.  We want what everyone else has.  It’s fun.  We’re bored.  We’re lonely.  We want people to like us better.  We want to be “ahead of the curve.” We’re “tech junkies”.  We can’t pass up a “good deal.” We think we might need it someday.  The sales pitch worked.  We’re stressed.  We’re trying to fill a void.  It was on sale.  We’re addicted to Starbucks, tobacco, scrapbooking, shoes, video games, books, fun, etc.

Sound familiar?

The truth is that whatever the reason, much of what we spend our money on is unnecessary, a want rather than a need.  I need to eat, but I want to drink my Keurig K-Cups coffee every day. I need to wear shoes, but I want to have dozens of pairs in every color and style imaginable. I want to get my hair done, but I have student loans and bills I need to pay. I want to take dance classes, but I need to pay for health insurance every month (why is insurance so much anyways?…347.00 a month!)  😦  So much for AFFORDABLE in Affordable Care Act.

It is so very important to realize the distinction between what we think we need and what we actually need. But its not an issue of wants Vs. needs, but wants Vs. Priorities.

It is the first critical step on the path to savings.

Don’t get me wrong, I’m not saying you should never spend money on anything, and live an austere and boring life, void of pretty things, entertainment or yummy coffee drinks.

But for the sake of this series, we are going to start by curbing all spending so that down the road we can figure out how to get those things we want in a way that fits our budget.

Which brings me to this week’s assignment:

1.  Stop spending!

Try to go these next seven days without spending money on anything except what is absolutely necessary, as in matter-of-survival necessary.  No clothes, no candy, no quick stops at McDonalds, no craft supplies, no nothing.  Don’t worry, it’s only a week.  You won’t die.  I promise. It is a great way to get your budget back on track in a hurry!

2.  Make a list of wants and needs

Spend your time reflecting on all the things you spend money on in a months time, and divide those things into a “needs” list (i.e.  I need to pay rent, pay utility bills, pay health and life insurance bills, buy food, make car and insurance payment, etc.) and a “wants” list (cable, , Starbucks, etc.)

  •  Don’t just make a mental list.  Sit down and physically write down every single thing you can think of that you spend money on, from the mundane to the major.

3. Get inspired

Read a few financial articles to get yourself motivated.  It will give you something to do while you’re trying not to spend money.

4.  Find new (free) ways to fill your time

Think long and hard about the reasons you spend money frivelously.  If you are using shopping as a way to fill a void in your life then you need to seriously explore other hobbies that don’t cost anything.  Go to the library and check out some new books, make it your mission to explore every park in a 20 mile radius, set a goal of organizing every closet and cupboard in your house by the end of the summer, or better yet, have a yard sale and make some money off the things that you already have that you don’t need.

I think the thing that surprised me the most when I stopped spending money out of boredom was how much more creative I became.  The world is full of free activities. You just have to look a little harder.

And that’s it for this week!  Stay tuned for another riveting installment next Sunday and remember, I want to hear from you!  If you’ve decided to take this 8 week challenge, or if you have any ideas for fun free activities you’d like to share, please leave a comment below.  Saving money is so much more fun when you have someone to share it with.
Samantha Jonas-Rongo