Living a Debt Free Life: Tips to Get into Better Spending Habits
Saving money is hard, but is even harder in the tough economy today. Because most of us aren’t really aware of how much we are spending, bad habits can drain savings and paychecks, and put your budget at risk. Most of us spend a thousand or more every year without even really knowing where it went.
When you take initiative to make a budget and find out what your spending habits are, you can find ways to dig yourself out of debt and get into better habits. Here are some ways to keep the spending down and keep yourself out of debt.
Create a Budget
Creating an actual written budget has many more benefits than you might first realize. A budget helps you really keep track of how much money you need to pay toward your bills, and how much you have left over. You might want to use an excel spreadsheet or another budgeting spreadsheet to help you keep track.
You also need to have a section that shows exactly what you are saving every month and keep a running tab of what’s in your account. This visual tool will help you see how much you have, and where you might be able to cut costs to save more money.
Use Coupons
While you might first think of the extreme couponing popular on reality TV today, most of us don’t have the time or energy, or the space to buy in bulk that way. But some couponing can help if you look in the newspaper, online, and use the ones that print at the register whenever you go shopping. Always organize your coupons so when you get to the register you don’t have to spend an eternity figuring them out.
With just a little bit of extra effort and careful planning, you can save as much as 25% on your monthly grocery budget. The typical family of 4 spends about $200 a week on groceries, so cutting coupons can save you up to $200 a month!
Smart Credit
Credit is a big part of our financial world today, but it doesn’t have to be your downfall. There are plenty of ways to engage in smart credit. First, it’s essential not to buy basics on a credit card. Always make the cash you have on hand stretch to cover bills, groceries, and gas. Expensive extras, such as computers and televisions can be purchased on credit, but first make a plan to pay more than the minimum each month to save on interest.
When shopping for a new car or even a new home, consider other credit options such as credit union loans or low-cost financing because they usually offer lower interest rates. Use a credit card that gives you incentives for purchases, such as cash back or sky miles.
Boycott Vending Machines
Many of us will get hungry throughout the day and hit up the vending machine at work. Typically a drink and a snack at a standard vending machine will cost around $2.50. That doesn’t seem like a lot, but when you do it every day over the course of a year, you have spent over $600. It’s much better to plan ahead and keep snacks from home with you at all times.
Spending Habits
The tips in this article can end up saving about $3000 or $4000 per year depending on your habits now. That’s a significant raise! Think about how much debt you can pay off, or how much fun you can have with that kind of money. Money goes much farther when you know exactly where you’re spending it.
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Category: Budget
