The following post is by Melissa Batai
Is your budget tight? Do you find you have no money left at the end of the month?
If so, you may have searched the internet for tips and advice. Likely you found simple suggestions like turning down the thermostat a few degrees in the winter, making coffee at home instead of going to a coffee shop, and clipping coupons when you buy your groceries.
These are all good suggestions, but what if you’ve already instituted most of these more obvious cost cutting measures? What then?
The next piece of advice you’ll likely find is to earn more. While that is excellent advice and will help alleviate some or all of your financial strain, for a variety of reasons, not everyone is able to earn more, at least not right away.
But, there still are other ways to cut your expenses and find more money coming in every month:
Analyze your paycheck. This is the first step. While your gross salary may be decent, if you’re paying a lot of expenses before you even get your net pay, you may be bringing home a fairly small paycheck. Look at these items:
Number of allowances. How many allowances are you claiming on your W-4? Before you make any changes, you should talk to your account. However, if you find, year after year, that you’re getting a tax refund that is a $1,000 or more, consider changing your allowances on your W-4 so that money is coming to you week after week, not going to the government to be refunded in one big chunk in the spring.
Health insurance. How much are you paying for health insurance every week? Have you chosen the Cadillac of health insurance plans? Could you pick an HMO instead of a PPO? Of course, you’ll want to consider each plans’ benefits carefully. You’ll also want to consider any special medical conditions that you and your family members may have before making changes.
Analyze your expenses. There are many places where you can make small changes in your budget without feeling the impact. After you’ve cut the obvious offenders like eating out and buying coffee at the coffee shop, consider these expenses:
Groceries. How much are you spending on groceries every month? What can you cut to go lower? Beans, rice, and oats are great meal stretchers. When you use meat, say in spaghetti, could you use ½ a pound instead of a whole pound? The USDA regularly publishes reports about the cost of groceries. Try to aim to spend no more than the “thrifty” plan.
Phone service. If you don’t want to use your cell phone as your land line, consider using a VOIP phone service. You’ll get long distance for free, and often you only have to pay the cost of taxes to use the service.
Cut entertainment. Look at your entertainment and find any duplications. Do you have a Netflix streaming and DVD account? Do you have free shows through Amazon Prime? Which of these services can you cut? Or, you may consider cutting all of them and getting your movies through Redbox or at the local library.
Unless you’re in a dire situation such as getting out of debt or suffering from job loss, I wouldn’t recommend making all of these changes at once. Rather, make them one at a time so you have time to adjust to your new lifestyle before making the next change.
What’s your favorite way to bring in or keep more of your hard earned money?