Things are more expensive than ever and incomes are being stretched. I’ve heard people take lower paying jobs because they pay weekly instead of bi-weekly or monthly. This is ridiculous. The first month or two may be a struggle but it will only be temporary. With a little bit of planning, you too can live the carefree, clear concious way even if you’re getting paid monthly. The first step to achieve your goal is to plan the things you need. It is unrealistic to just go cold-turkey and stop spending/eating. Sit down with a notebook and write out your expenses in several ways, this will help you come to terms with your money and create a budget.
First break down the 12 months and write down all your bills. Your monthly bills may include, daycare, electricity, water, rent, cable/internet, etc… If you get your paper delivered, lawn mowed, etc… add those costs in. If you don’t pay something every month, choose which months you will pay them and write them in. For things like insurance, be sure to get the cheaper option… if it is cheaper to pay for 6 months up-front, make a point to do so, decide which month you will pay and write it in. Add up your monthly totals and then add up your yearly expenses.
On another piece of paper, write out all the consumables of your life… one of the biggies in this category is transportation. How much does it cost you to go to work? Include the price of your automobile loan payment if applicable, insurance, maintenance and gas. Did you catch that I consider a vehicle a consumable? That may defy most people’s logic but I don’t consider it to be an investment, but rather a tool to be used. If you are using it to get to work and make money, it is a tool. If you’re not using it to get to work, you may want to reconsider it’s value and the necessity of it. In any case it is important that your vehicle is safe and as energy effecient as you can afford.
Other consumables that you are using include food and toiletries. Food has a large variance from person to person. If you can figure out a way to eat all your meals at home, you’ll save big time. (I will be writing a post on low-cost meals in the near future.) Toiletries can usually be purchased for little money if you are not brand specific and if you plan ahead. How many tubes of toothpaste, bottles of shampoo, deodorant, etc… do you use in 3 months? pick a month and buy all you’ll need for that time period. This will save you time and gas instead of going to get it. Don’t forget to budget for all those consummables your family members use, diapers, dishwasher tabs, laundry soap, etc… On the subject of laundry, if you can, buy a washer/dryer. Instead of humping all that stuff and spending an hour choosing what to wear to do the laundry, buy a machine. If you’re spending $10/week on machine use, you could own your own washer/dryer in less than two years. If you can’t, maybe you could buy a portable washing machine and air-dry many of your clothes. As a last resort, pick up a bottle of Woolite and learn how to wash your clothes by hand. If necessary, pay to use the dryer or a quick iron will whip most clothes into shape.
After you’ve written out all your expenses, plug them into certain months so you’ll be prepared. Spend the first month at your new job to really concentrate on work. Eat cheap food you can take with you to work and if possible, walk or share a ride to save on transportation. In no time you will be ahead and not waiting for your next paycheck.
Once you’ve written out your budget, things WILL get easier. Spend a few months cutting back and sacrificing a little. The payoff will be BIG and you will live a carefree life.