Budget Bloated? Go on a Spending Diet!

After all of the spending and consumerism of the holidays, we need to cut back.  Advertisers and retailers spend a lot of money to make us believe that more is better, and that if we buy that special item, it will make our lives easier and our family happier.  Yes, sometimes things do make our lives easier.  My smartphone, in my opinion, makes my life easier.  But now is the perfect time of the year to remind ourselves what we already have and what really makes us happy.

Inspired by Rachel and her family over at Small Notebook, we are naming January "No Spend Month".  I suppose calling it a "No Spend Month" is a bit of a exaggeration, because we will be spending.  Just a lot less of it.  Let's call it a SPENDING DIET.  That sounds much less scary.

The Rules of our "Diet"...

Our family of 3 will have $450 to spend on fuel, groceries, and anything else we may buy for ourselves for the entire month. (Wow, that seems so low now that I've typed it.)  This includes clothes, shoes, household items, entertainment, gifts, and eating out.  I can tell you already that I don't think we will be buying much more than groceries or gas with that money.

Can't Save? Try Prioritizing Your Goals

Most people, including myself, find it very hard to save money day in and day out.  It's difficult to not want that awesome iPad 2, or those oh-so-soft bath towels, or that cute pair of shoes.  If you don't take a moment to come down from that shopping high and really think about what you're doing, you will have that item paid for and on it's way to your house quicker than you can say, "Zoiks!"

Don't get me wrong.  It is okay to splurge and buy yourself or your family something...on occasion.  You should enjoy that money you work so hard for.  But hopefully these splurges are more of a planned event with saved funds and a budget, rather than an impulse buy.  I think the problem for so many is that we tend to get lost in our interpretation of 'enjoying our money'.  We have a lifestyle that we want to support, for whatever the reason, even if we can't afford it.  Or we just get lazy.  Too tired to cook tonight, so let's order pizza.  Don't want to drive to my own bank's ATM down the street, so I'll just use this one right here and pay $5 in fees.

Yes, I enjoy spending money on eating out and shopping and vacations, but I enjoy even more being able to pay my bills and mortgage on time and having a savings account that can get us out of a jam or keep us afloat if needed.  Financial security is far more desirable to me than that sexy Macbook.

Financial Meetings with Your Spouse--Do You Have Them?

Lots of financial 'gurus' encourage weekly financial meetings with your spouse/partner/significant other.  I can see how it would be helpful for both sides to have an updated, complete picture of the family finance.  That way you can make sure you're on the same page regarding your short and long term goals (hopefully you have some in common), your progress towards those goals, any possible changes (budget, insurance, investments), and upcoming expenses (car repairs, tuition payments, gifts to buy, etc.).  Then you can go about your week making more informed spending decisions, which moves you  more rapidly towards your goals.  For example, if you know that your husband is in need of a new shoes, you may think twice before buying that purse, or adjust the budget for the month to allow for extra spending in certain areas.

TV Lovers CAN Live Cable-Free and Save Some Money

I never thought Hubby and I could do without cable.  We were addicted to our DVR, liked our HD channels, and had a steady rotation of shows we would watch throughout the week.  It wasn't like we were spending a fortune on cable...just over $50 is not bad at all, considering some people we knew were spending well over $100/month for similar packages.  I added it up one day and realized that over the course of the year we were spending over $600 for tv.  We weren't even watching half of our channels.  I was interested in looking further into streaming tv through our internet connection and socking that extra cash into our emergency fund.  This is what we found...

Grow Your Emergency Fund

It is so difficult to save for your emergency fund when there are so many things competing for your hard earned cash.  The bills, mortgage or rent, student loans, vacations, retirement, saving for kids' college, etc etc.  But if you don't have any sort of emergency fund, or at least 6 months expenses socked away, this should be at the top of your priority list.  Yes, even over paying down debt--especially if you have kids or a spouse depending on your income. 

The first step to growing your emergency fund is figuring out exactly how much you can contribute.  This is where I have to use that nasty little word... BUDGET.  If you don't have a budget it will be very hard to determine how much you have available to devote every week/month/year to your savings goals.  Without a budget, you're most likely just spending without a plan until your bank account is empty, or until you get your next paycheck, with absolutely nothing to show for it and little to no safety net.  You work hard for your money so you should fight to keep it.

7 Ways to Be Lazy and Still Save Money

Saving money for us definitely takes work.  We have to stay disciplined all day, every day.

For us, the less thinking and less work involved in saving that money, the better.  These are just a few of the passive saving tactics that have helped us cut our budget and continually save money (and also happen to be pretty eco-friendly.)  Most of them you only have to perform once, with a time investment of anywhere from 5 minutes to an afternoon.

1. We installed a programmable thermostat...and actually SET IT!  Programmable thermostats are a great thing because they allow you to have the best of both worlds--lower/raise the temp while you're away to save energy and money, while still being comfortable while you're home.  Pick one that will suit your family's needs and schedule--you can even set totally different schedules for every day of the week if your thermostat has that capability.  But, you have to take the time to set your desired schedule and temperatures and use the programmed settings!

Obviously there is an upfront cost for the thermostat itself.  Comparison shop online at sites like Shopzilla or Pricegrabber and be reasonable about the features you need and will use so you're not spending more than necessary.  Prices start around $20 for a basic model and go up to $150 and above for a high end touch screen version.

One tip, though...be realistic about your temperature settings.  Don't set the temp to drop to 60 degrees at night if you know your kids will kick their covers off and freeze or the whole family will get the sniffles.  Just set it to drop (or raise) a few degrees and you still will see some savings.  I sometimes make the mistake of bumping it up or down a degree or two temporarily, then forgetting to put it back on schedule later that day.  Leave yourself a bright colored post it note if you do that!

Update: Cleaning out the Pantry

Okay, so the final grocery budget for November is...$522.  That means we went over by about $75 this past month.  In our defense, $20 of that was for Hubby to buy lunch to reward his employees at work one day.  But I'm human (I'm saying "I" and not "we" because I do almost all of the grocery shopping.) And like I said before, that is the hardest category for us to stick within and I will try and do better this month.

Cleaning out the Pantry

After all of the extra expenditures this month and some other factors, our budget is pushed to the limit right now.  Our food budget is no exception.  We are just over for the month with one week left.  Luckily, Thanksgiving meals will cover us for a couple of days.  I do need to pick up milk and bread tomorrow to get us through, but I just did my meal plan for the next week and I think we can get by on what we already have in both the pantry and fridge.  We'll just have to get a little creative with lunches if there aren't enough leftovers.

Update: Our kid is with relatives for the week...What's the gameplan?

We had a semi-successful week, although not as cheap as I had hoped.

"First, we want to paint the master bedroom."  Yes, complete. Although we spent a little more than expected because we used the fancier paint store for its color matching service.  In our experience, the home improvement chains just don't do a good job of that.  So we ended up with pricier $40 zero VOC paint (to satisfy my environmentally-conscious side) but we only had to do one coat.  So, now that I think about it, rather than do two coats and buy two gallons of lower quality paint, we saved ourselves some time and only had to do one coat and buy one gallon of good paint.  So the paint cost, in my opinion, was worth it to save some time and hassle.

Our kid is with relatives for the week...What's the gameplan?

My folks are on vacation this week, and living a couple hours away they don't get to see as much of our son as they would like.  I agreed (actually, I jumped) on their offer to keep him for the week.  It will allow me to catch up on some work projects and housework, plus have some quality time with Hubby now that we're both busy with work and school.  I want to definitely have some fun, maybe a cheap date night (complete with a bottle of wine--woohoo!), and also get some projects done that are challenging with a 3 year old around.  I also don't want to go too spend crazy this week trying to complete those projects, since I hadn't really factored anything into our budget at the beginning of the month and we just replaced our car windshield last week.

Six Expenses You Can Reduce or Eliminate that Add Up

1) Ditch the land line. Why do you still have this?  We haven't had one for years and probably never will.  You probably only get calls from telemarketers on your land line.  And the phone companies charge all those stupid taxes and fees.  You don't need it--you can still call 911 on your cell phone.  Switch to your cell phone only.  Cell plans provide more minutes than ever before, and everyone probably calls you on it already anyway.  If you're concerned about going over your minutes, look over your last few bills and the number of "anytime" minutes used.  Only if necessary, research upgrading your plan.  Bumping up your minutes will probably cost you less than your land line.  Tell anyone who IS still calling you on your land line to call your cell from now on, and cut the service.  But before you go too crazy with the cell plan...

Multiple Savings Accounts are the Way to Go!

I hate those pesky bills that come quarterly, semi-annually, annually...They are so easy to forget to factor into our monthly budget because they're irregular.  Though not unexpected. Those companies screw up all the time, charging us this, messing up that, but they never seem to forget to send us those darn bills!

For the past few years (especially since being self-employed and having to save for quarterly estimated taxes) we have been keeping a separate "Annual Expenditures" account for those annoying bills.  Call it whatever you want-"Irregular Expenses", "Stupid Large Bills", etc--but this is the way to save and pay for those bills. In our account, we save to cover property taxes, my estimated taxes, car insurance, car tags and inspections, homeowners association dues, life insurance, a yearly vet appointment, yearly dental appointments...you get the picture.

Why I Will Never Again Buy Laundry Detergent

To fill you in, Hubby was unemployed for most of 2010. Before his job loss, I thought we were doing laundry fairly cheaply by buying a huge bottle of generic detergent at a warehouse club or Target, washing only on the cold setting, doing only full sized loads, and hanging everything to dry (with the exception of sheets and towels.)  While we had begun preparing for the possible loss of his job by boosting our savings and cutting back on 'wants' in the 6 months or so beforehand, we were still unprepared financially for the cut to his income.  He was the breadwinner and I am self-employed (i.e. salary can be unpredictable from year to year, or even season to season.) We didn't make a bundle of money to begin with, so our spending and budgets were pretty bare bones to begin with and there was little leftover for savings, or at least, I consider it little (about $300-400/month).

The Beginning of My Journey

On a whim, I have decided to add to the ever expanding list of personal finance blogs, hopefully with a female spin, to track my personal journey and growth (fingers crossed) and maybe help a few who stumble upon it.  I will be the first to acknowledge I'm not perfect.  These are my opinions and thoughts and you may not agree with me.