This is a collaborative post by Ellie Jo.
So, you want to start budgeting your money to make better use of it. Maybe you have something you want to save up for or you want to avoid or repay debts. Making that decision is the best thing you can do if you want to get financially healthy. But a budget isn’t exactly the same as reality, so here’s how you change your spending habits and slim down your costs.
Know your goals
First, you actually have to build your budget. It’s not too hard to do it when you sit down and look at your money situation. You start with your goal, how much you want to save or how much you need to pay off. Then you take all the money coming in, all the paychecks and benefits and such. From that, you divide the money into necessary expenditures, non-necessary expenditures with the important part being deciding now how much you’re putting aside toward your goals. To make it easier to stick to those goals, make sure the money set aside comes out of the account first. Even before your bills and your grocery money.
Track your spending
You don’t want to spend more than you can afford to, but sometimes it’s too easy. A cup of coffee on the way to work, an extra carton of juice than you expected to buy. Apps like Mhriley.com/SpendingTracker can keep a running total of all your expenditures. You can compare that with your budget and see when spending is getting dangerously close to breaking it.
Cancel the things you don’t need
The subscriptions and services you collect and pay can vary between the essential and the non-essential. When it comes to the non-essential services, you need to prioritize which ones you really want to keep and which you don’t. Credit reports, Apple subscriptions, streaming services like Netflix and Twitch channels. It’s time to decide which ones it’s time to unsubscribe from. First to go should be those that you even forgot you were subscribed to. Pore over your bank statements covering a couple months to make sure you cover everything.
Get on the phone
Then there are those services and subscriptions that you consider absolutely important. Not just your bills, but services like cable and internet providers can be important to you, and you don’t have to cancel them all. You can, however, renegotiate your bills. You can get on the phone yourself, or you can make a little expenditure hiring a team like BillFixers.com with the expertise that you might lack. That way, you might even get more off your bills than you expected to.
Look at your insurance providers
We understand why you might not like the idea of touching your insurance. But reviewing your agreements and the others on the market is something you should actually do every year. Companies like car insurance providers rely on you just renewing without giving much thought to it. First, you should look at what other providers are offering better deals. Then you should take a look at what different provisions are actually in your agreement. Is there anything you could reasonably cut out without being at too much risk? More importantly, are there any agreements that simply seem too difficult to claim to be of any use?
Become a coupon hunter
It might seem like we’ve covered the big expenses, but the truth is that your expenditures outside of your bills can sometimes be the most damning costs of them all. Tracking your expenses is one thing. But you want to get what you want for less money. To that end, sites like GoGoShopper.com can help you become a real deal hunter. Collect vouchers when you can, find coupons when you can, and always see if there’s a way you can get a better deal when you decide you want something. In most cases, someone is going to have a better offer than where you first looked.
Make the wallet a little plumper
Cutting your spending is important, but it’s always a good idea to give yourself a little more breathing room. To that end, you should look at making your wallet plumper by selling what you don’t need. There are some surprising possessions that can get you more money than you think, too. Books, the oldest of old phones and devices, even the rights to use your photography if you capture any images that people think would make good stock photos.
Cut the bad habits
Bad habits deserve to be cut. Not only are they bad for your health, but they can cost you thousands a year. Smoking is one of the most expensive out there and can easily be replaced by much cheaper e-cigarettes, for instance. Buying less junk food and getting more fruit in as well can be just as good for your wallet as your waist. If you like playing online bingo or roulette, then think about less expensive ways to get your competitive online thrills like competing in the many free online games like Hearthstone.
Treat yourself occasionally
Budgeting can be a stressful time, especially if you’re giving up the kind of habits mentioned above. So, be ready to give yourself a little break from time to time and treat yourself. Go for a meal out. Go to the cinema. Allow for some variable expenses room so that you can blow off some steam. Without bending the rules and indulging once in awhile, it’s a lot easier to break those rules and break the budget.
There are a lot of little other ways to save more money. You can make a greener house and pay more attention to conserving energy and thus cut your energy bills. You can buy less processed food and instead plan and cook your meals so you use only the ingredients you need. You can change where you shop for groceries. When you get used to the steps above, it’s a lot easier to find the other little ways to save even more.