The New Year is here and it’s time to get organized, reduce your debt and have a savings account for emergencies. It’s not impossible to achieve all these goals in the coming year if you are ready to change your spending habits.
Budgeting made easy
Getting organized with your bills is the first step to understanding what your debt is and where it derives from. Pull out all your monthly expenses and list them, then add up your monthly income. This will give you a clear understanding of where you stand. Hopefully, when you compare the two lists, your income supersedes your obligations. If this is the case, then you can move onto the next step, which is to analyze each bill. For instance, the electric and gas bill – are they high compared to the national average in your area? If so, then it might be time to shop around and check out other companies like ENMAX Red Deer and compare rates. Not all companies are alike and becoming a smart shopper can help to save you a lot of money throughout the year.
Spend less and get more
Smart shopping isn’t limited to just your utilities. There are many other areas that you can save big money without sacrificing on quality. You’re heard the expression “Never shop on an empty stomach”, well the same holds true that you should never shop without comparing prices and bringing coupons. There is, of course, a right and wrong way to use coupons. The right way is to first make a shopping list and then search for coupons that pertain to your proposed purchases. Don’t use a coupon just because it’s offered, use it only if it benefits your list. Depending on your weekly allotted expense you could save $15, $25, even $40 on one outing. This is huge, especially on a tight budget.
It happens, you see something and you want it now. But if you place it on a credit card or deplete your bank account to acquire it, then you’re leaving yourself short for the month and susceptible to falling behind on your bills. Putting it on a credit card also reduces your credit score and increases your debt. Instead, if there’s something you really want, save for it. A new product on the market is often less 6 months to a year down the road. So, not only will you pay cash and not take on another debt, but, chances are pretty good you’ll pay less for the same item.
Pay yourself first
When you’re on a tight budget the last thing you would think of is to pay yourself first, but it works. By giving yourself an allowance you have money in your pocket to buy your coffee, lunch, and other small items. This also takes away the feeling that you’re working just to pay bills and eliminates the need for nickel and diming away your bank account.
Establish a savings
If you are like most you probably live paycheck to paycheck and when an emergency comes along you cringe. This is because you have nothing tucked away for a rainy day. Even on a tight budget, you can open a savings and contribute each month or week. Before paying your bills, take a percentage of your salary and place it in a savings account. Initially, this will seem hard and you’ll want to pull it, but once you get through the first month you’ll find that you’ve worked around that money and now you’re on your way to having a savings set aside for the next home or auto repair.
Make this New Year’s resolution one you keep for life. It will allow you to take a deep breath and remove the feeling of anguish over paying your bills. By this time next year, you might even have enough to enjoy a well-deserved vacation without a bill when you return.