How to budget money

Learning how to budget money is something every person needs to do in their lifetime. If you’ve been feeling the squeeze of the economy lately then you may be looking for some quick ways to cut bills fast! Due to events that happened last year including surgery, a car accident, and a house fire I’ve been doing the same! When those things happen a lot of your bills can go up in a short period of time.

How to budget money – Save some money!

The firs thing needed to get your finances back on track is to save some money obviously. Some of the biggest pinches on people’s finances are every day bills. The ones that don’t really change much month after month. You can however lower these if you really need to save some cash quick! Here’s the top offenders, and what you can do to fix the problem.

Phone service

With smart phones, data plans, and internet browsing we pay a lot for phone usage. Make this your first cut by ditching any services that you don’t really use. Have a look at how many minutes and how much data you use! Are you paying for way more than your share every month? Cut it! If you’re paying for 1,000 minutes per month when you really only use 400 then try and drop your plan. Instant savings every month. You can drop your bills as much as $20 – $60.

Make sure you don’t under estimate yourself though as it will cost more if you go over. If you have roll over this shouldn’t really be a problem since you’ll be using up those minutes. If you see yourself creeping over your goals next month you can switch back no problems!

I have never had a landline phone personally. I find it to be a waste of money when I’m paying for a cell phone anyway. Cut it out if you really just don’t use it. $40/month savings.

Gas

A lot of Americans are feeling the pressure of gas prices right now with prices rising, and commutes getting longer. If you live in a smaller town like I do you may have to seek work many miles away. This adds to your gas bill! When you’re already in a squeeze for money investing in a new fuel efficient car is usually not in the budget. If your job is too far away to walk or ride a bike you can consider car pooling or public transport. If a co worker lives nearby offer them some money to take you to work. This can save both of you a lot of cash.

If you’re paying a big car payment it may actually be worthwhile to trade that car off. Especially if you bought when interest rates were high and can get a lower one.

Mortgage/rent

The mortgage or rent is one of the biggest spending places for people. Often times it eats up a third of the income of a household. If you bought your house in the boom or started renting then you may be able to start paying much less. Have you thought about refinancing your mortgage? My aunt and uncle are paying 8% for their mortgage for the house they bought in 2006, and now they have the option to refinance at a paltry 2.5%! That’s a huge savings. Especially when you consider that more than HALF of your monthly mortgage payment for the first several years of home ownership is only going to interest and not your principal. If you can afford it selling and moving to a cheaper house may even benefit you if you can’t keep up with the mortgage. You will most likely lose equity, but if you can afford the loss it could work out better for you in the long run to let go and start over.

If you’re a renter and you don’t really want to move try negotiating with your land lord. If you have already stayed past your initial lease tell them you are thinking about moving due to cost issues. If you’ve been a good tenant your landlord may lower your rent some to get you to stay! Good renters are few and far between. If you have somebody who’s paying you every month and doesn’t wreck your property you want to hold on to them. They’ll probably help you out!

Electricity

Electric bills vary, but are always a substantial portion of a home’s financial burden. I know it sounds simple, but simply using less can drop your bills a lot! It’s summer here in Florida which means my electric bill hit a high of $170/month last month! When I’m using less air conditioning? It’s about $85. That’s a huge percentage savings. How can you do this and still remain comfortable?

Use your air conditioning when you need it most. I turn off my thermostat everyday when I go to work. Why spend money to cool a house with nobody in it? I sleep during the day because of my night job. So, I run it during the afternoon when it’s hottest and I can’t sleep. When I get up I turn it off again and open up the windows.

Try blocking sunlight with Roman Blinds to keep the temperature down. The sun beating directly in can really heat up your house. Turn off things you don’t need like computers, tvs, ect. All of those big electronics generate a massive amount of heat. Hence the fans inside them! Where does that hot air go? Right into your house. When I lived in a single room with friends years ago I didn’t need heat in my bedroom because my computer generated so much heat of it’s own!

Insurance

I hate insurance companies with a passion, but it’s a necessary evil unfortunately.  You can make those bills lower though! If you’re paying an arm and a leg for insurance try cutting your deductibles. At least temporarily if you need to get your budget back on track to make extra credit card payments, ect.

Cutting your deductible can lower your bill tremendously. If you have an older car it really does not make sense to pay for full coverage! You will be paying more in insurance in a year or two than your car is actually worth! If you have a brand new car under a big payment you probably can’t afford this cut though.

You can change your medical coverage on your auto policy too. If you already have good medical coverage through your job you probably don’t need this coverage and it can drop your bill a good amount. Also, ask your auto insurance company if they have any special discounts! Many companies offer discounts for additional vehicles or boats, home owners, safe drivers, or completing safety courses!

I dropped my home owners insurance massively by dropping ‘contents replacements’. This basically means they pay to replace your furniture and the contents of your house. Since most of my furniture was either free or bought off craigslist for pennies of its retail value this would be a stupid thing for me to pay for. I see this being the case for most people. Especially since the insurance company will only pay what they think the USED value of your stuff is worth. They won’t just shell out a check for what you really paid for it.

Food

Food is the next big cost for people. Even more so if you have a large family with several kids! Never fear! You don’t have to eat crap everyday to balance your food budget. The easiest way to save money on food is to eat stuff at home. Making things from scratch is MUCH cheaper than buying food that is convenient. It’s also better for you too. Learn to make some recipes from scratch. There’s a lot of things you can make like pot roast, dumplings, soups, ect. that are delicious and were MADE to stretch the budget. Many of these types of meals were developed by people who didn’t have a lot of money, but had a lot of hungry kids to feed!

You can also save money (and gas) by buying in bulk. Buying meat in bigger quantities and freezing it will save you a lot of money per pound usually.

Employer Discounts

Here’s one many people don’t think about! If you work for a big company they may offer lots of incentives to their workers. These are usually discounts they’ve made deals with other companies for. I get 20% off my AT&T phone bill every month just because I work for my company.

See if your employer offers anything like this! You may be entitled to discounts for things you’re already paying for like phone service, internet, cable, ect! It never hurts to ask, and you could be saving a bundle you don’t even know about!

How to budget money – Part 2: Make some more money!

If you’ve cut everything you can cut and you can’t cut anymore maybe it’s time to make some more money? Easier said than done sometimes, but if you have a special skill you could be putting it to good use for extra cash. Here’s some ideas!

Fiverr – Have something you can do quick for $5? Post it up on fiverr and start making some money. Lots of people will pay you to do stuff they don’t have time to do on their own!

What if you have a skill you can’t do online like repair work? Try craigslist! If you know how to fix or do some type of service there’s people that need it done for them. Offer your services here and give people a deal. You can make some fast cash if you know what you’re doing.

Have a yard sale or craigslist sale. Do you have oodles of crap in your house you don’t need? Sell it on craigslist. If you need to dump old furniture and stuff try selling it on craigslist. If you have small high value things (ipods, phones, ect.) then ebay is probably better though. If you need quick money for a repair or upcoming bill this could be the ticket.

Not Enough? Learn Simple Steps from People who’ve been there on how to get your budget on track TODAY and create new income streams! Don’t be buried by debt any longer. Click here to learn how to be money smart!

Originally posted 2011-09-10 22:11:14. Republished by Blog Post Promoter