A Few Changes Now for More Money Later

It is not how much you are making that determines what you have left in the bank at the end of the month but it is the amount you spend that matters most.  Successfully managing your money will require sacrifice, accountability, and some good old fashioned discipline.  Those words aren’t usually associated with fun but they are necessary traits that you need to possess in order to build your savings instead of settling for living paycheck to paycheck. The following five areas should be the first place to look at first.

Food

You will definitely have more money if you quit eating, but in reality you won’t
live long unless you eat.  If you find yourself going out to eat all of the time, this is a great place to start when looking for areas in your spending plan where you can cut the fat. Identify how many times you go out in a month, and then reduce it by half.  Along with going out to eat if you enjoy going to your local coffee shop, keep in mind that your $4.00 a day latte habit can end up costing you $30 dollars a week or $125 dollars a month.  If your better half is tagging along with
you, your morning ritual could realistically be costing you over $250 a month.

Entertainment

How many television channels do you really watch? Consider trading your 1000 Gold Tiered Cable package for basic cable.  If you enjoy going to the movies
it’s still cheaper to rent a movie from Redbox than it is going to that afternoon matinee.  Even better, go to the public library and get your entertainment for free.  At most public libraries you have the ability to download or check out music, movies and books for free.

Retail Therapy

Many people spend money as a means of entertainment or coping with boredom and emotional issues. If you find yourself watching infomercials or the shopping channels on TV because you can’t sleep, or visiting your local malls and shopping centers every weekend for something to do, consider finding other ways to occupy your time so you are not tempted to buy things that you might not really need.  If you have too much time on your hand, consider volunteering. The saying “it is better to give than receive” really works. 

Communication

You can definitely save some money if you can get by with either a land line or a cell phone, but not both.  You might be reluctant to get rid of your landline because of 911 issues with cell phones.  According to the FCC it is estimated that 70% of 911 calls are placed on wireless phones so if you are stubborn and think you have to have a landline in case of an emergency, visit www.fcc.gov for some tips on 911 calling from a wireless phone.  If you and your spouse each have a wireless plan in addition to your landline consider getting rid of one of those cell phones.

Gifts

I would be the last person to tell you to stop spending money on gifts, but it is important to set a budget. Instead of breaking the bank during the holidays, open up a gift account and put money into it each month. Once the holiday are near you can shop until your heart’s content. Keep an eye on is all the smaller purchases you might be making: clothes, toys, etc. It might not seem like much at the time but when you add it all together, it could easily be costing you more than you realize.

What matters most is for you to start doing things differently. Keep in mind that less is better, and change will require some sacrifice, accountability, and discipline. If you can make a few changes now, you will find you will have more money in the bank at the end of the month. 

Steve Repak, CFP®, author of Dollars & Uncommon Sense: Basic Training for Your Money