If your spending habits have you digging for pennies before the next payday, maybe it’s time for a change. Unfortunately, running out of money before payday, especially if you do it over and over, causes a lot of undue stress that can negatively affect your health as well as your pocketbook.
However, you can reduce this stress and get back on track with your finances by altering your spending habits.
How will you do it?
Try these budgeting techniques:
1. Make a Master List. Develop a list of all your loan payments and credit card bills. You’ll expand your awareness about the number of creditors you have, the total amount you owe, and the due dates of your monthly payments.
- On the list, have 5 columns: the name of the creditor, your monthly payment, the due date of each month’s payment, the amount of interest you’re charged, and the total amount you owe.
2. Add other monthly expenditures to your Master List. Next, list things like your rent or mortgage payment, grocery costs, gasoline costs, and anything else you pay monthly. Estimate the amounts for your cable, water, garbage, cell phone, and utility bills, using last month’s statements. Your Master List should reflect all your outgoing expenditures.
3. Establish priorities. Which bills do you see as the most important? Mark them in some way by highlighting or circling them.
4. Survey the remaining bills. In looking at these non-priority bills, you can most likely discover some areas in which you can lower your costs.
5. Examine frivolous expenditures. Are you spending $30 a week on fancy coffees? Do you stop after work for a few beers with co-workers two or three days a week? If so, consider the amount of money you spend for these sorts of activities. Which expenditures can you reduce? Which can you cut out completely, at least for a three-month period?
6. Call your credit card companies to request lower interest rates. Make a notation on your Master List of the reduced rates you receive. Also note any companies that refuse to reduce your rates. Make the decision to stop using credit cards with high interest rates.
7. Take decisive steps to reduce your expenses. For example, if you’re paying out $180 a month for premium cable channels, you have the power to cut your cable bill simply by picking up the phone and calling the cable company.
8. Determine how you can bring in additional dollars. Consider a second job. Then, use the extra money you earn to pay off debts. Recognize you have the power to change things.
9. Keep your Master List with you throughout the day. Each time you’re about to make a purchase, glance at the list and reflect on your bills. Ask yourself if you truly need what you’re about to purchase. Allow yourself to feel proud about this new routine.
10. Record your thoughts and feelings about the changes you’re making. It’s a challenge to try to change something about yourself, and how you manage your finances is no different. Write down how you’re feeling about adjusting your spending habits. Be optimistic that you can and will change your financial situation.
If you consistently find yourself running out of money, vow to follow these strategies to change your unhelpful behaviors. You have the choice to alter your financial habits in powerful ways. You can do it!