- Repair when possible – in the past, a lot of consumers felt blaze about throwing away old appliances, furniture, and clothes. This was mainly due to the easy availability of credit. Nowadays though, credit has tightened up. Repairing the things you already own can free you to save significant amounts of money. When a button is missing from your favorite dress, it would be cheaper to buy one button instead of a whole dress.
- Delay the purchase – people delay their purchase if they’re running out of cash or are living from paycheck-to-paycheck. However, practical individuals know that there’s also virtue in putting off the purchase. For example, as long as there is not a special even coming up, it does not make much difference if you get a haircut this week or next week.
- Rent or borrow – it’s easier to rent or borrow what you need to these days. There are countless sites that lets you swap, trade, and rent from others. If there’s a big event coming up and you want to look stylish, it’s possible to borrow a $1,000 bag for less than a tenth of its cost.
- Do it yourself – whether it’s creating your own gifts or cooking, you can do most things yourself. The next time you’re craving an Italian pizza, why don’t you take the opportunity to learn to cook it yourself? It will cost half as much and you’ll still have fun, especially if you invite friends over. Throw a get-together at your house instead of eating at a restaurant.
Whether it’s buying a car, laptop, or even clothes, most people want to buy these things brand new. There is just something about the feel and smell of newly-produced items that make a person feel special. But when you’re trying to save money, it’s important to pay more attention to the practical side of purchases. Although quality always counts, there are many alternatives that will give you access to good quality at affordable prices. Here are some alternatives to buying new:
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Most people know it is important to save money, but being able to save is another matter altogether. There are just so many great products that entice you to part with your hard-earned cash. Even those with the best intentions end up giving in to the impulse to buy now and then. Discipline is important. But even more crucial is to build up the habit of saving money. Here are some tips that will help:
The holidays should be a positive and happy season. But for many people, it is also the root cause of stress for several months each year. They fall into the trap of buying everything from clothes, shoes, electronics, books, appliances, and other items they don’t need. There is a sense of entitlement once the holiday season approaches. Also at the back of everyone’s mind is the thought that they need to give a gift to everyone they know.
This is simply not the way to celebrate the season. Celebrating a special occasion shouldn’t be an excuse to throw caution to the wind. Read on to find out how to curb your holiday spending while still enjoying yourself at the same time:
So you have sat down and done the grunt work necessary to figure out a budget that works for your financial situation. Now what? Especially if the funds available after paying bills and other essentials are significantly lower than what would be comfortable, a primer on frugal shopping is in order. Frugal, or “smart,” shopping is more than choosing the least expensive item on the store shelf — it’s about finding deals and money-saving tips that pay off in the long run.
Shopping trips should be accounted for in a budget like anything else. That way, you have a lower risk of spending money you don’t have on things you don’t need ¾ although a healthy dose of will power never hurts. Not only should you have an idea of how much money you will be spending during the trip, you should also write out a shopping list, in order to dampen the allure of impulse items. Perhaps the loudest siren song of the supermarket is that of the sale tag. These are usually large, colorful tags advertising a sale price; they draw the shopper’s eye, proclaiming that the item is on sale ¾ often for a limited time. Do not be deceived. While they serve to denote some price reduction or special offer, these tags are not always on the lowest-priced item. Look around at similar items from other companies or manufacturers. Compare the item’s original price with its sale price. How much of a difference is the price. Or, how good is the special offer? Importantly, ask yourself if the product will be completely consumed soon enough that taking advantage of the sale or special offer makes sense in the long-term. For example, if you need a head of lettuce, and you see that one brand is buy-one-get-one-free, that can sound like a good deal. However, if the cost of a single head of lettuce is more than a different brand, will both heads be eaten before either of both of them wilts? If not, consider getting the less expensive, single head of lettuce. It may not seem like a better deal, but in the long-term it is a better value for your shopping dollar. Also keep in mind that no single store has the best prices on every item. Compare prices for items you buy frequently, to get a sense of which store will most often have the best deals. If you can go to two stores and get the best of both worlds, by all means do so. Just do not let the desire for deals distract you from other relevant concerns, such as how much gas it takes to get to both stores. Learning about one or two stores in your area gives you an advantage, because you end up getting a sense of how they operate their big specials or sales. And finally, the adage really is true: don’t shop on an empty stomach. With more and more Americans sliding into debt, and national unemployment figures hovering around double digits, it’s more important than ever to establish and manage a budget. Budgeting may often seem like a monumental task, but with a few simple steps almost anyone can keep his or her finances from getting out of control.
The first step is the most obvious: figure out how much money you will have available to you in a given period of time. For the purposes of these steps, designate a single month as being that specific period of time. The available-money figure represents the starting point of your budget. Ideally, it looks like a nice, comfortable number. Unfortunately, it probably won’t look that way for long, but that’s one reason why budgeting your finances is so important. Remember, you want that number to stay healthy and provide a cushion, should something unexpected arise. Next, subtract your known costs. Items like your rent (or mortgage), for example. Other monthly costs ¾ such as auto insurance, a mobile phone bill, and internet expenses ¾ should also be subtracted. Now look at the number. There are still two steps left, but at this stage you should have a better idea of where your budget will end up. The third step is optional but important. Figure out a percentage of the amount of money left over, after known expenses, to put into a savings account. Five, ten, fifteen percent…it doesn’t matter. What matters is that this percentage will help in the future, by accounting for expenses that you had not anticipated. The last step is deciding what to do with the money you have left over. Think of this as the “reward” step: the one you can make without feeling guilty. It’s the assurance that, through your savings and smart budgeting, your finances are secure. Try to save a little more each month and stick to your budget, and each month will be a little easier than the last. Budgeting can often seem a mountain of a task. At the end of a month, when your finances seem to have missed the area in which you thought they would land, it can seem as impossible as holding smoke. However, approaching your finances as a month-to-month ordeal can too easily allow them to become unwieldy and ungainly. The easiest way to keep both your finances and your budget in a manageable place is to keep an eye on them day by day, reviewing each and every minor transaction. Before the advent of modern technology, the only absolutely reliable method of keeping track of one’s every transaction existed in the form of checks and a checkbook. Today, the check has largely been replaced by the debit card. Still, the checkbook dutifully remains. The work of recording every deduction and addition is that of habit.. Each transaction should be recorded to keep a current and accurate representation of one’s finances, either after every such transaction occurs or at the end of every day. Waiting any longer than a day to record transactions invites lethargy, and allows it to grow to a dispiriting state. So make daily transaction recording a habit. It does take a moment, but if you stay up to date it will take only a moment.
The advantage of keeping your checkbook current not only enables you to stay abreast of your financial standing, but it also alerts you to purchases or withdrawals that have been made without your foreknowledge and approval. Balancing your checkbook is but one component of your complete financial plan. It is an important component, because it’s both a supplement to your overall budget and a major guidepost on the path to financial security. image: Heidi Elliott |
AuthorI started this blog to offer up some no-nonsense advice to success in personal finance. I might also cover some other related topics over time too. Archives
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