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Tuesday, January 16, 2018

Four Ways to Slash Your Budget


Today, I'll give you some black belt techniques to help you see "change" in 2019.  


#1: PAY WITH CASH


 That's right!  You wanna spend less money?  Fork over hard earned US currency.  There are many categories which lend themselves to paying with cash.  Clothing, groceries, and household are just three budgeting categories which make good sense to pay with cash.  Statistically you will spend about 30 percent less when you use cash.  

If your monthly grocery funds are in an envelope, you will work really hard to insure that you have money until the end of the month.  It's so easy to look in that little white enclosure and instantly see that you have just two or three twenty dollar bills and there are still ten days until the next month begins.  You know you won't be getting chips or snacks.  No, instead, you'll be getting a ten pound bag of potatoes for less than five bucks!  Potatoes are versatile, nutritious, and easy to make.  Paying with cash helps you get down to brass tacks really quickly when it comes to money.   

My personal experience:  It never occurred to me that paying with cash would result in spending less money until we took a Dave Ramsey Financial Peace University class.  I had been budgeting and saving money for over two decades of marriage.  Honestly, the only reason we even took the class was because our teenage son was handling our family finances for six months (a requirement for high school graduation in the Ware family).  I thought, "I have no idea what this guy will say to me that I don't already know."  Well, on the video he explained the idea of cash envelopes.  Not being one to back down from a challenge, I did it.  It was the hardest two months of my life!  I kid you not!  The physical act of handing over cash (and not fudging on how much I spent) was one of the most difficult experiments of my life!  But, whenever, the budget is tight, I dig those envelopes back out.  It does work!  


#2: DINE IN






It's not that we never dine out, rather it's that we have planned dining experiences, not spur-of-the-moment restaurant rushes.   Those who save money know how much money is set aside in the written budget for eating out.

Consider that in 2015 the average American family spent about $4000 a year on groceries and just over $3000 a year in restaurants.  That restaurant tab is  seventy-five percent of the total amount spent on eating at home!  Just consider the savings if you cut that amount even in half!   According to a research study by Peapod and ORC International, in 2017 both millennials and boomers planned to spend more time in the kitchen and less time in restaurants.  Their reasons varied from saving money, eating healthy, to wasting less food - all music to the ears of super thrifty people!

My personal experience:  For over two decades we have eaten out at  restaurants - any restaurant - fast food and sit-down fare combined - anywhere from 3 to 6 times a year.  Nope!  That's not a typo.  When we announce to the kids that we are eating out, genuine joys breaks out.  It is truly a treat for them to eat at a restaurant.  Instead, we focused on providing family experiences that cost little to no money.  For many years we had "Friday Night Picnics".  I packed up whatever I made for supper and we carted it to the local park.  Here's a link to a post I wrote on it.  My older boys always mention this tradition when we ask them for special memories they had growing up.

If the weather is inclement, spread a blanket on the floor and eat picnic style.  My boys loved it when I prepared what they called "snacky supper".  This was their word for me putting out little pieces of cheese, various crackers, breads, fruits, raw veggies, hummus, and cookies for supper.  They got permission to graze and snack to their heart's content.  Kroger has a great bin with chunks of cheese that are $5 or less.  It's high quality cheese.  It's just small pieces of it.  So, they discount this cheese.  We sometimes buy three or four different kinds so the boys can try various textures and flavors of good cheese at a bargain price. 

Don't pressure yourself to "keep up with the Jones' by carting your kids to overpriced venues more times than you can afford.  Give them the gift of family. Splurge on a chunk of imported cheese, a hunk of good bread, fruit, and a simple dessert.  Then, feast at home.



#3: PLAN TRIPS



By "trips" I mean any time you get into the car.  Before you stick that key into the ignition think, "Is this trip necessary and can I combine these errands to make better use of my gas budget?"
  
My personal experience:  When we were saving to purchase our second home with cash we sliced and diced our budget, showing no mercy whatsoever.  The gas bill turned out to be one of the easiest to regulate.  We got our gas bill down to one fill-up per vehicle per month!   My husband rode his bicycle three miles each direction to work as often as possible.  I walked to the bread store with the boys.  We combined every errand that we could, stopped for groceries on the way home from church, and planned out driving routes to reduce overall miles driven as much as possible.  Using these methods we sliced our gas bill by 40 percent!  

#4: DITCH CABLE AND SATELLITE 

It's a quick and easy way to cut up to $1000 out of your yearly budget. 



Do you really need 100 television channels? Are you paying huge fees for something that you watch a handful of times a month?   I challenge you to ditch your cable or satellite television. Subscription services are always listed as "monthly fees".  Do you know why?  It makes their astronomical charges easier to stomach.  People rarely take the time to actually multiply that number by 12 to see what they are paying every year.  Do it!  It will curl your hair! 

If you want to see that "big game", find a friend with cable and offer to bring along chips and beverages and settle in on their couch with them.  Most movies are available on Netflix , Hulu, and Amazon video shortly after they are released to the mass market. Paying to stream a movie twice a month is a whole lot cheaper than cable television.  The cheapest Netflix subscription is just over $10 a month. 


My personal experience:  I've been married for nearly 30 years.  We've never had cable, satellite, Netflix, Amazon, or Hulu.  More importantly, we've never missed them.  We have, however, made terrific use of our public library and we do borrow movies about twice a year from our local Family Video. Otherwise, my kids know that when new movies debut at the theater, we look up the video release date and put our name on the "wait list" at the local library.  It goes without saying that if a child over the age of 12 wants to go to a movie that they pay for the experience out of their own funds.  For our family's views on finances for children up to age 16 see this post

How much money will you save?  Well that depends on how much you currently spend.


Let's get the discussion started!  If you have tips of your own or questions on budgeting, comment below or send me an e-mail at underthemedian@gmail.com.  


Until next time, 

Do all to the glory of God, 

Hope



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