Let’s face it, budgets suck. All a budget does is make you worry that you’re spending more than you’re saving. And that may be true. When you sit down and take a glance at your expenses you may start to panic. Or cry. Or probably both. You may immediately decide to stop buying anything extraneous, or vow to never go out to eat again. You may think you have to completely cut your expenses down to the bone. You may, just may, overreact.
I think healthy spending habits are kind of like a good diet. Most of us start a diet by cutting out all the delicious, fattening, sugary treats that make us happy. And what happens? That diet lasts about 3 days, we’re grumpy the whole time, and we end up feeling like a failure. The diets that work the best allow you times to eat those ooey-gooey snacks, but the trick is moderation. It’s the same way with your finances. Don’t think you have to totally stop buying anything frivolous or non-essential.
We all have expenses that are constant every month; mortgage, insurance, cell phone bill; you probably can’t reduce those expenses so just don’t worry about them. Let’s concentrate on the fluctuating expenses. You’re going to want to start at the beginning of the month and the good news is that for the first month of the new thrifty you, you don’t want to change your spending habits at all. In order to get an accurate picture of how you spend, you need to spend like you usually do. Next step,(and we’re going to go old school here) save all your receipts.
I know, we almost never say “yes” when a cashier asks if we want the receipt, but this is the easiest way to see all your actual expenses. Bank statements and credit card statements only tell us how much we spent at what store. Receipts reveal all the items we thought we just had to have in the moment.
Now, you have all your receipts for the whole month. Here is where it gets tedious and daunting. This is the moment you may feel like a finance failure. This is when you may overreact. So, first of all, take a deep breath and know that it’s not as scary as you think. Simply, look at your receipts. You can ignore items like milk, bread, diapers. Those fall into that essential category. Then find things like potato chips, cookies, ice cream. Those are okay too, unless they start to outnumber the essentials. Let’s face it, how many opened, half-eaten, stale bags of chips do you throw out each month? And how many cartons of ice cream so coated with freezer burn that you can no longer identify the flavor crowd your freezer? Now that you’re looking at the receipts, you can calculate how much food you buy that goes uneaten. So that’s a great place to start to cut back. Eat the snack food you already have before you buy more.
Next step, look at those receipts for Walmart, Target, TJ Maxx, Walgreens. Did you need everything on those receipts? No. You went to Walmart for toilet paper, cleaning supplies and a prescription and what else did you get? A cute shirt that shrunk in the wash, a lipstick that was a terrible color for you so you threw it in the back of the drawer and a new case for your iPhone. Now, yes, these 3 things only amounted to $30, but if you do that every time you go to Walmart… You see where I’m going here?
But remember, you don’t have to completely stop buying things that you don’t need. In fact, you shouldn’t stop buying those things, just take a little more care with the things you choose. If you look at those Walmart and Target receipts you will see frivolous things you bought that were worth it. A new pair of winter boots that are so comfy you wear them every day in December. The earrings that make you feel like a rock star. These purchases are ok, again as long as they don’t out cost the essentials.