In my last post, I talked about setting budgets & paying down debt. The more extra money you can come up with, the quicker those debts go down.
Today I’m going to talk about how to squeeze a few extra dollars out of your pay.
So now, get those pens out and list all your budget categories. This is the list we came up with.
- Mortgages
- Insurances
- Utilities
- Car Expenses inc Fuel, Registration & Repairs/Maintenance
- Groceries
- Spending Money
- General i.e. chemist, doctors, vet
- Phone & Internet
- Debt Repayments (credit cards, personal loans, leases)
- Health Insurances
- Savings
- Cable Television Subscription
It’s harder to save money on set payments like mortgages, insurances & utilities.
It’s discretionary spending where you can make a big difference.
The underlined categories were the areas of overspending that we identified. Your list may be different, but the same principles apply.
Groceries
We use the envelope system for groceries. $200 cash per week goes in there every Monday morning. If we run out before the end of the week, tough luck, we have to make do. This was one area where we were wasting loads of money.
Since we started using cash, we often have some money left over so that goes into a separate envelope for a night out or a weekend away as a reward for being frugal.
Spending Money
$100 cash each goes into our wallets every Monday for incidental expenses. We use this for minor purchases like the newspaper, a coffee or a drink with friends, a chocolate bar, small gifts etc. it’s amazing how often we have money left at the end of the week, because we have found, because it’s cash, we are more inclined to save it, not spend it.
General Expenditure
For this category, we opened a joint account with 200 per fortnight going in automatically. It comes with two Visa Debit cards and this account is used for clothing, chemist, doctor, hair appointments & minor vet bills.
For larger expenses they go in to a category of their own & are budgeted for. Once those high interest credit cards are paid off, the money that was going to pay them will be added to the existing $400 per month in the joint account & these will be our new “credit cards”
Cable Television Subscrition
We were paying $122 per month for pay TV, and we hardly watched it. So I cut if off, split it into two $60 payments added to the home loan. I did it the same day so we not only didn’t miss the Pay TV, but we didn’t miss that money either. I was already paying extra on the loan and together with this extra payment, I will have saved 25000 in interest by the end of the loan.
I can’t believe how much money we used to waste. This is a simple budgeting system but it has changed our lives
Thanks
Loraine & Pete
The Inspiration Bench 