Thursday, August 15, 2013

Thrifty Thursday: Setting Your Budget and Spreadsheet

There is so much to cover when you are trying to set up for a budget for the first time but I wanted to cut everything into bite sized pieces.  If you have followed along the first four steps, you have already figured out your expenses, your income, made a spreadsheet and a budget.  Now is the part where you get to use a pencil and paper and figure out how you can make ends meet.

The best first step is to make a call to your cable company, phone company, and others and see if you can cut back any costs or change to a promotional package.  The worst that they can say is no and the best that they can do is save you a little bit of money.  Turn the air conditioning to a higher temperature while you are at work by a few degrees and unplug everything that isn't being used.  It is always a great way for found money because they are expenses that you already have and you have some control to cut a little more money off the top of the spreadsheet.

The next thing is to see if there are any expenses that you can cut.  Don't use the home phone much anymore?  Get rid of it.  Don't watch cable that much anymore?  Get rid of it.  These steps seem a little extreme, figure out what works for you.

We personally cut out going out to eat and buying limited new clothes.  We limit take out or going out to eat to under $20 per month and most months don't usually use it.  We don't need a lot of clothes (especially now that I don't have a job to go to) and we have a closet full.  My son who is a growing boy but we don't get a lot of clothes for him because his grandparents like to get him clothes for gifts.  We spend some money on his clothes and shoes.

We also cut back on gifts for birthdays and Christmas.  There is lots of spending that happens around that time of year.  I have always been a planner who buys things on sale ahead of time to get the best deal for gifts but now I am trying to lower my spending on all people we buy for and decrease the number of people we buy for (especially since I don't have people at work to buy for anymore).  We have also been shopping for toys at consignment sales for my son so that he can get a variety of different toys for super inexpensive out of pocket for expensive toys.

My main goal before quitting my job was to decrease my grocery budget to get it to the lowest we possibly can.  I decreased each month to see how low I could get it without having any problems which lead to me the $160 budget for our family of three.  With a lot of creative cooking at home,  I try to make treats that we like to eat out so that we don't feel like we are giving up anything.  We often eat from the pantry, freezer and continually use leftovers to make sure that we make ends meet and stay under budget.

All things are about the trade off.  If you want to get your hair cut and colored at the salon, maybe you don't get your nails done and get a morning coffee.  You are the only one that can figure out the trade ins that are going to work for you.  The most important part is to make sure that you pick things that are going to work for you long term.  Being frugal takes a little more time and if you work many hours, it might be hard to get dinner on the table every night but I know that with a little planning, everyone can do it. 

Things still aren't working out positive for you?  Figure out how you can make a little more money.  Have a garage sale, sell some stuff on Craigslist or ebay, or get another job.  It helps you get rid of things that you aren't using and helps put a little money in your pocket.

Move your money to higher interest accounts or banks.  There is a big difference between banks and accounts so pick which one works best for you.  I moved some of our savings into a CD which makes a much higher interest rate which means that I will make a little more money on everything that we are saving.  The great part is that making more money on what you already have doesn't cost you a thing and adds a little more money in your pocket each month.  Make sure that you are careful to see what has FDIC insurance so that you don't have all your money invested in accounts where you can loose money.

I hope that you can work with your budget and make ends meet with the steps that we have laid out.  It really sets your mind at ease when you know where your money is going!!  I know that it makes me much happier and less stressed to know that I am going to end the year on a positive note if I stick to the plan!!  Make a plan and stick to it and you won't have to worry about money and budgets and all this work will be in your past!!

If you are interested in this post, here is the link to all of the posts in the series:

Figured out expenses
Figured out our income
Made a Spreadsheet
Making a Budget
Setting Your Budget and Spreadsheet
Budget Busters
Take the Emotion out of Budgets

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