Posts Tagged ‘budget’

Road to Savings

Thursday, February 7th, 2013

I recently contacted a lady named Debbi King on a website I came across. She has many of the same principals on saving money as we have used ourselves and in our book, Stop Wasting Money. I asked her to share  as a guest blogger what does it really take to start over financially for our followers. Debbi’s contact information is found at the bottom of this article.

We all say that we want to save money, but many of us don’t know where to start.  I had this same feeling years ago after I had filed for bankruptcy and was starting over, financially.  So I decided to start everywhere.  That seems like too much, but let me explain.

One of the greatest tools I used to turn my financial life around was a budget.  I know most people cringe every time they hear the word “budget”, but it is a great tool if used properly.  You can’t look at a budget as something keeping you from having what you want.  You have to look at it as a tool for you controlling your money instead of it controlling you.  I challenged myself to look at every category and see where I could save money.

There are two main kinds of expenses we all have:  fixed and discretionary.  You can find savings in both categories, although the discretionary is the one you have the most control over.  Let’s visit both kinds of expenses and see where you can save money.

Fixed Expenses

  • Rent/Mortgage – You may think that you can’t control this item, but you can.  You decide where you are willing and want to live.  Your rent or mortgage (with insurance and taxes) should be no more than 25-27% of your take home pay.  If it is more than that, you are living in a place you cannot afford.  It is okay to move or sell your house.  A house is just a building and you will find another one that you like.  A home is wherever you are.  We downsized from an apartment with a $750 rent to an apartment with a $500 rent.
  • Telephone/Cable/Cell Phone – These expenses are a mix of need and want and you need to adjust them accordingly.  If you are in a contract on any of these items, you will either need to wait until the contract ends or pay the early termination fee, whichever is less.  These are items that you can have and should have, but you don’t need all of the bells and whistles and every channel they offer.  We went from a phone with a plan to a great prepaid phone.  We also went to basic cable.
  • Electric Bill – You can’t change what company you use or what they charge, but there are hundreds of simple changes you can make within your home to lower your bill.  Some examples are unplugging every plug when you are not using it, turn a light off when you leave the room, use the energy cycle on your appliances, and lower/raise your thermostat two degrees in the winter/summer.  We did everything from lowering the heat and layering to drying clothes outside in the summer.
  • Credit Cards – If you have credit card debt and monthly payments, you do not have a lot of control over your monthly obligation.  However, you can if you have good credit, combine all of your cards onto one new card with a lower interest rate and focus on paying that off.  This isn’t new debt; it is a way to manage debt you already have.  The best thing you can do while you are paying the credit cards off if to not incur any additional fees above the interest you are already paying.  This means always pay the minimum and make your payment immediately upon getting the bill.  This will save you in late fees and additional interest.  We stopped all debt and then attacked a debt snowball to pay back the couple of credit cards we had.
  • Car Loans/Insurance – Again, it will be hard to lower a car payment, but you can get rid of your car payment by selling your car, paying off the loan and buying a car with cash.  With your car insurance, the key is to shop using an independent insurance agent.  And as soon as you get your $1000 emergency fund in place, up your deductibles to $1000.  This will save you a lot of money.  We use a great independent insurance agent to shop for us every six months and we drive well in order to not get any tickets that would cause our insurance to go up for 3 years.

Discretionary Expenses

  • Groceries and Eating Out – Eating out should be a treat, not all of the time.  With groceries and eating out, always look for coupons and deals.  Do not be ashamed to use a coupon.  Also, take advantage of discount grocery stores such as Aldi and Bottom Dollar Food.  The food is the same at a much lower price.  Make sure to know what is on sale and stock up when you can.  We started buying store brand when possible, stocking up when meats and cheeses were on sale, and planning our meals before we went to the store.
  • Gasoline and Car Repairs – You can’t control the price of gas, but you can get the most out of your tank.  Plan your errands and trips and get the most done at once as possible.  Also, how you drive and maintain your car can affect your gas mileage and your repairs.  We started planning our outings better and driving no more than 5 miles over the speed limit.
  • Entertainment – Plan for something once a month if you can, but learn to take advantage of free fun.  You need to have fun in your life, but do not go broke doing it.
  • Clothing – You can find great items at your local thrift store and consignment shops.  Or even at your local discount store.  You don’t have to buy everything at the mall.  We learned to live with what we already had.  If we needed or wanted something, we found a way to get it at the lowest price possible by taking the time to shop around and waiting until we found it within our budget.

These are our categories on our budget and how we found savings in each one.  You may have budget categories in addition to these and I would challenge you to think about how you can save money, even a few dollars, in each category.  I read an article yesterday where a guy saved $275 a year just by changing brands with his everyday products like soap and deodorant.  Savings can be found anywhere and they all add up.  Start finding your savings today and watch how fast they grow.

 

 

Written by Debbi King

Personal Finance Coach, Motivational Speaker and

Author of “The ABC’s of Personal Finance”

www.abcsofpersonalfinance.com

www.facebook.com/abcsofpersonalfinance

What it Takes to Save Money

Tuesday, November 30th, 2010

I recently saw a comment by BILL WADDELL at www.superfactory.com.  I kept thinking how could this business idea be converted into personal savings.

The quote is : “It doesn’t matter whether you are selling $250 dinners, or $1 flashlight batteries, it is the degree to which work is well done that determines your success, and no amount of manipulating the money can compensate for a lack of work well done.”  If you want to be successful at home, where money is concerned, it depends on the effort you place on completing this task. If you do not plan how you want to achieve this task, it is unlikely it will be achieved. It takes more than just a budget. It takes a willingness to learn how and where to cut spending and Stop Wasting Money.

Debt Busters

Monday, November 22nd, 2010

From putting spare change to work to going on a spending fast, these folks found creative ways to chop their debt.

Anna Newell Jones

Strategy: Go on a spending fast for a year
Advice: Get creative. There are endless ways to save.

I had been spending over my means for a while. Every month I was spending at least $300, overdrafting my account and feeling horrible about it.

I realized I had all these wants and it was an insatiable thing. I would say, “Oh, I love this top from Anthropologie,” and then as soon as I got it everything would be great… until I wanted something else. So I knew I needed to do something drastic. And one day, it clicked.

I decided to start a spending fast for the new year, which meant no spending on anything except absolute necessities — like my mortgage, utilities, car payments — oh, and hair dyeing. That was one “want” that I turned into a necessity as I started to see my roots grow in.

I can’t buy clothes, no coffee out, no eating out. To save money, I’ve done the normal budgeting things like buying generic brands of groceries. But I’ve also started wearing all black and dyeing my clothes to extend the color. I’ve been re-gifting, growing my hair long to avoid haircuts, stuffing two loads of laundry into one and eating a lot of old canned food I’ve found in my cupboard. I also make random stuff to sell in my spare time. I have a store at Etsy.com where I sell zombie portraits of people, super cute baby onesies and banners, tags and shipping labels.

My year-long spending fast began on January 1, and so far, I have saved $5,772.25. $4,800 of that went to credit cards and the rest will go to paying my parents back the $3,247.97 I owe them and my $10,000 in student loans.

Lance Pickett

Strategy: Live without the little things
Advice: Don’t go too far — like trying cloth diapers to save $60

My wife and I owed $18,000 in student loans, $6,000 in car loans, $2,000 in credit cards and $152,000 in my mortgage.

We were living paycheck to paycheck and I was tired of seeing my bank account zero out every month. So we wanted to get out of as much debt as possible as soon as possible. We started by saving an extra 1/12th of our total required expenses — like mortgage, utilities and Internet — each month, in order to have one month worth of bills saved up at the end of the year. Then we got excited and doubled that. In three years we had six months of living expenses and threw that into a high interest CD at 5%. That really got us going, seeing the money grow — and we became obsessed with eliminating debt.

We just really took a look at what we need and only spending money on those things. I used to eat out a lot and that cost me $200 a month. Now we invite friends to “eat-in” at our house. We have a garden and purchase produce from co-op programs. Before we became debt-obsessed we would also get nice Christmas gifts for each other, but now we limit each other to $50.

Now, if there’s something we want we put it on our “Dream Board,” a cork board by our bedroom door that we see everyday. And it will stay there until we’re debt free. It also has the loan schedule for our house, and each month we scratch off a month. Next to the schedule, we post our ultimate “want” that we agree to purchase — with cash of course — once our house is paid off. I have a 2010 Camaro waiting for me.

Cutting back so much has been hard, but we’ve learned a lot along the way. My wife learned some things are worth paying more for after trying to use cloth diapers — which most people use as burp rags — pinned inside training pants with plastic pants over them for our two kids, all so that she could reuse the diapers and not spend $60 a month on Pull-ups. As a result they both got horrible rashes, so we switched to a cheaper brand of regular diapers.

Altogether, we’ve paid off around $90,000 since 2005.

Jowharah McNeil

Strategy: Put spare change to work.
Advice: Cut back, use cash.

I was laid off for 18 months and had two credit cards to pay off, so I had to learn to be creative. My husband and I have been trying out a cash-only spending system and we’re only allowed to spend $40 a week per person on non-necessities. That means once the cash is gone, it’s gone — no more spending.

While doing this strict new budget, we noticed we had a lot of loose change everywhere — in our cars, leftover from doing laundry — so we started collecting all the change we could find and putting it in a jar by the door. Every month, we would use whatever money is in the jar to make payments on one of the credit cards. The minimum payment is only $39, but we usually paid an extra $50 or $60 using the coins we collected so that we can get it totally paid off as soon as possible.

Since we started collecting the coins about six months ago, we’ve already paid more than $560 of the $1,000 balance on the card, so this is really working for us.

Brian Leigh

Strategy: Track your expenses
Advice: Don’t limit yourself too much, or you will give up.

I was able to pay off $22,000 of my $35,000 in credit card debt over the past 24 months just by looking really closely at where I was spending my money.

Being young, I made foolish mistakes with my credit cards, so when I started really wanting to knock out my debt, the biggest thing for me was tracking my expenses. I started by adding up how much I had been spending on meals and found out I was spending almost $55 a week just on lunch at work.

After that, I sat down, got a little notebook and started tracking every single thing I spent money on. I did that for a couple months, and then I came up with a payment plan. After overestimating how little I could live on the first month, I decided to take small steps.

I readjusted my allowance until it worked with my lifestyle. I started to bring my lunch to work four days a week, I shopped for groceries for one week and would then eat only leftovers during the weekend. I learned how to cook and found foods — like broccoli — that I can use in multiple meals so I don’t have to waste anything.

To make sure my money goes where I need it to go, I set up two checking accounts and two savings accounts. I deposit $250 into the first checking account every two weeks –when I get my paycheck — to use for everyday expenses. When it runs out, I don’t go out.

I put another $250 into the first savings account as an emergency fund. Every five paychecks, I remove $1,000 from this account and apply it toward my credit card debt. I deposit $100 into the second savings account every paycheck. This account is used for long term goals, like a down payment on a house or a big vacation I want to take. Everything else gets deposited into my second checking account, and my bills and rent are automatically paid out of this account. Those automatic payments include an extra $1,000 toward my non-credit card debt — like my student loans and car loans — every month.

Jaime Tardy

Strategy: Budget!
Advice: Save, save, save before you quit your day job.

A couple years ago, I decided I wanted to have a baby and quit my job. But there was a problem. My husband and I were in debt, and I made two-thirds of our household income. So I couldn’t just quit.

I started out by sitting down and adding up all our debt — which ended up being around $70,000. The first thing I thought was, ‘Wow, we really need to start getting rid of this. We should sell our car right away.’

After some prodding, my husband got on board too. We sold his car and were able to immediately get rid of $19,000 of our total debt. After that, we knew we were totally doing this.

Craigslist and eBay became our best friends, and we sold everything from a kayak to a weight bench and a computer monitor.

My husband did some website design jobs on the side to make some extra money, and we printed out a budget each month so we knew exactly how much we could spend and what we would be spending it on.

We saved on gas costs by limiting the amount of driving we did, and we put ourselves on a grocery budget of $300 a month. On top of that, we cut out cable, lowered our phone bill as much as humanly possible and switched our car insurance twice in one year to find lower rates.

By the time I quit my job for good — which was less than two years after I started the budget — we had paid off $70,000 in debt and put $23,000 in the bank as an emergency fund.

http://financiallyfit.yahoo.com/finance/article-111092-7153-1-how-she-paid-off-big-debt-in-a-few-short-years

Original Article written by

Blake Ellis
Friday, October 22, 2010

www.CNNmoney.com

9 Low Cost/No Cost Marketing Tips & Techniques

Monday, October 18th, 2010

Do you need to get more clients? Are you trying to get your first client? Is your marketing budget equivalent to the cost of a Happy Meal? The following tips and techniques are not by any means hidden secrets, but they are some of the most overlooked ways to market a small business today.

1. Know your target audience.

As silly as it sounds, many small business owners kick off a marketing campaign without regard to whom they want to target. If you send out a coupon for NASCAR tickets to the first 1,000 people in the phone book, some will undoubtedly be thrilled and will do what’s necessary to earn the tickets (akin to dropping 1,000 mailers from an airplane — some
will hit the target). But just imagine the response rate if you sent out the same 1,000 NASCAR ticket coupons to only those people who attended a NASCAR event in the last year. You’ve gone from wildly shooting to steadily aiming your campaign, thus increasing your
response rate and decreasing your cost per customer.

2. Publish an e-zine (or newsletter).

Publishing an e-zine or print newsletter (even as short as a page) is a great way to keep in touch with your customers and clients. You can produce one online using a program such as Constant Contact for little to no money and can even set your e-zines up in advance using
easy-to-understand templates.

3. Have a website and keep it updated.

All businesses, no matter your size or field, need a website these days. You can get a domain name for as little as $2.95/year and, using templates, have a basic design done in a few hours. Once your customers, clients, and potential customers and clients have visited your website, they will find fresh, quality content in the form of new e-zines, articles, blog posts and tips. This will keep them, and the search engine spiders, coming back for more.

4. Opportunity is calling.

While not usually viewed as a marketing technique, answering the phone and follow-up is critical in this day and age of limited valuable time and impersonal service. Have you ever called someone only to not get a call-back or sent an email and waited days for a response?
More clients and prospects become lost revenue these days due to inadequate, or non-existent follow-up. If you receive a phone call from a prospective client or from an existing client, call him back as soon as possible or, better yet, immediately!

5. Get involved online.

Find out where your target audience hangs out and participate in those online discussion groups and forums. Yahoo Groups is a great place to find a wide variety of discussion groups. Several business owners also belong to Ryze — an online networking forum. By consistently offering your help to others, you will position yourself as an expert that others will turn to when the time is right for them.

6. Get involved offline.

Getting involved with local organizations can help to build your reputation as a “doer”, a “go getter” or just a really dependable individual (all things which will help your business). Just remember that you are representing your business in everything you do and act accordingly.

7. Word of Mouth/Referrals.

We’ve all heard the saying that a happy customer tells somewhere between 1 and 3 people about her experience while an unhappy customer tells up to 12 people about hers. Keep your customers happy, ask for feedback as to what you could do better, and once you know they’re happy, then ask for a referral. People generally are willing to help those they like.

8. Use postcards.

Whether you are an online-only business, a brick & mortar establishment or a hybrid, you can effectively use postcards to market your business. Postcards are easy to do, inexpensive to mail and have a high readership. Many people associate postcards with personal notes from friends and family and don’t even think before they turn it over to read the message. With this method, you have already gotten into the hands of many people that wouldn’t take the time to open junk mail.

9. Have others do it for you or with you.

Never underestimate the power of cooperation and reciprocal agreements. Is there a vendor that has a related, but not directly competitive, target audience to yours? If so, form a strategic alliance where you recommend his products/services and he recommends yours. For example, a movie theater and a restaurant could share customer information and play off each other for promotions.

While many of the above tips and techniques will arouse the “DUH” response, it’s constantly surprising to me how many businesses – small and large – overlook these basic items in their day-to-day marketing and operations.

Continue to save money with your home or business at www.stopwastingmoneybook.com

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This article was supplied by A Strategic Marketing & Profitability Mentor, Sandra Martini (www.SandraMartini.com), creator of Escalator Marketing™, shows creative  entrepreneurs how to build sustainable businesses without losing their integrity or their minds.