Archive for the ‘Budgeting’ Category

High Food Costs on a Low Budget

Friday, March 11th, 2011

If you’ve been to the grocery store recently, you’ve probably noticed that the cost of food has risen considerably in recent months, a result of the rising cost of gas and an already tight demand of wheat, corn and other staples.  But if your salary hasn’t risen to reflect grocery store prices, you’re likely among the millions of Americans struggling to find room in their budget for necessities.  Here are some ways to stretch your food budget without sacrificing on the items that you need.

Skip Pre-Packaged Foods

High food costs on a low budgetIt’s no secret that pre-packaged snacks are among the biggest splurges you can make in the grocery store.  Instead of paying top dollar for individually-wrapped cookies, for example, buy a larger bag and let each child take his or her snack in a sandwich bag.  This strategy can save you over $10 in the scope of a single month.

Make Your Own Food

You may think that a loaf of bread, for example, isn’t that expensive, but in reality, it’s about five times the price of what it would cost to bake a similar loaf on your own.  Likewise, you can make over 50 cupcakes for just a few bucks (think about the cost of a single bag of flour, half a bag of sugar, some oil, eggs and chocolate chips), while about 10 servings of pre-packaged snacks will cost the same price.  There are dozens of similar examples of foods that are relatively easy to prepare and will help you save big – all you need is a bit of time and creativity.

Re-Examine Your Menus

Do you really want to splurge on steak, or can you enjoy a delicious meal of meatloaf or chicken?  Do you need to purchase a bottle of salad dressing, or can you make your own salad topping for a fraction of the price?  You’ll be surprised at how much you can save if you adjust your menus and recipes to focus on cheaper food instead of luxury items.

Buy Second-Tier Produce

I’ve written several posts about how to save money at the grocery store, but in addition to the obvious (use coupons, buy in bulk, etc), it’s important to consider purchasing things you wouldn’t otherwise buy, and trying new, cheaper things.  One such things is second-tier produce, or fruits and vegetables that are about to pass their peak and are ready to be enjoyed immediately.  In some cases, you may need to remove some soft spots in order to use a specific vegetable, but this effort will pay off big time.  Second-tier produce can be used to create inexpensive meals that can be frozen.  Among my favorite examples are bananas, which can make cakes, cupcakes and muffins, potatoes which can be used in stews, casseroles and for homemade french-fries, and zucchinis which can be turned into soups and quiches which freeze beautifully.

Cook from the Cabinet

Your pantry is meant to be used, not just looked at.  When the cost of food is high, reduce your weekly shopping expenses by eating food that you already own.  You’ll be able to replenish it when general food prices go down or you can find items on sale.

5 Gadgets That Will Save You Money

Friday, March 4th, 2011

If you’re anything like me, you probably prefer to buy the cheapest items possible just to save a few cents.  Chances are that you probably avoid certain purchases altogether, because you perceive them as being unnecessary or overly expensive.  But while this spendthrift attitude may be helpful most of the time, there are times when it can actually be detrimental to your savings plan.  In fact, there are some so-called ‘expensive’ purchases that can actually save you money.  Read on to discover five ‘splurges’ that can improve your life and your bottom line.

Cappuccino machine – If you’ve ever looked at the price tag on a high-end gourmet coffee machine, you know thatMoney saving cappuccino machine it can cost somewhere in the hundreds of dollars.  But then again, if you’ve looked at the cost of a cup at some coffee bars recently, you’ve probably noticed that a cup of coffee can cost as much as a full meal in some food chains.  Here’s the bottom line:

Approximate cost: $200+

You’ll break even after…about 75 specialty coffee shop brews

Compact fluorescent light bulbs – For just a few cents, a traditional incandescent light bulb can last for 700-1000 hours.  This may seem like a lot, but compact fluorescent light bulbs can last for over 10,000 hours, while using significantly less electricity to run.

Approximate cost: $3+

You’ll break even after…About 915 hours of usage

Water filtration system – If you purchase bottled water regularly when you’re on the go or you have gallon jugs delivered to your home water cooler, chances are good that you’re spending upwards of $30 each month on drinking water.  Having a water filtration system installed on your kitchen sink will allow you to have crisp, drinkable water without the steep monthly fee.  Filters that are attached to the faucet’s exterior are the cheapest, but even more stylish models that are installed under the sink can be found for a reasonable price.

Approximate cost: $40 for a faucet filter or $60 for an under-sink filter

You’ll break even after…1-2 months

Laptop – Today’s laptops only cost a bit more than a desktop, and are designed to last just as long (assuming you don’t drop it).  The beauty of a laptop is that it requires much less energy to run, and can be used for hours at a time without charging it, which saves you money regularly.  As an added advantage, a laptop can be used to continue working on those days when your internet service is out (I don’t know about you, but I have at least two of those a year, when it snows, when there’s an electrical failure, or when the cable company has an internal glitch).

Approximate cost: $400+

You’ll break even after…About a year

Smart power strip – I once mentioned that 75% of a home’s electricity is used when the power is off.  This is known as the phantom charge, and it’s a phenomenon that can be easily avoided by using a smart power strip.  Available on Amazon, these power strips can stop the flow of electricity to multiple electronic devices simultaneously, and can save you money for years to come.

Approximate cost: $25-$30, depending on the model

You’ll break even after: About 9 months

I hope you enjoy shopping for these items, guilt-free!

Bargain Hunting Basics (For Black Friday and Any Day)

Wednesday, November 24th, 2010

Lately I’ve been spending lots of time sharing great Black Friday deals with you…and getting excited about gearing up for the upcoming shopping holiday.  While many shoppers prepare themselves physically by stocking their purses (or backpacks) with food, water and a valid credit card, it’s crucial to prepare yourself mentally as well so that Black Friday Black Friday shopping tipsdoesn’t live in infamy as the day you landed yourself debt.     Here are 7 ways to succeed in your Black Friday shopping without breaking the bank.  Good luck!

  1. Make a list. The most important thing to bring to your Black Friday shopping spree is a shopping list.  Check out the circulars of your favorite stores in advance whenever possible so that you’ll be able to determine what you’ll be buying as gifts and what you’ll want to pick up for yourself.  It may be hard to buy things for yourself when you’re spending money on gifts, but if something is a really good deal, it may be a good idea to pick it up now to avoid overpaying later.
  2. Set a budget. Budgeting may seem like a killjoy, but it’s a critical way to ensure that you don’t overspend on Black Friday (or during any other shopping spree).  Think about how much you want to spend on each gift and don’t exceed that amount.  If I may be so bold, I’d also suggest adding a few extra dollars to your budget above what you plan on spending so that when you see a great deal that you can’t pass up you will be able to pounce on it without feeling guilty.
  3. Pack snacks.  For many shoppers, Black Friday is more exhausting than any triathlon.  Make sure that you bring enough food and drinks to keep you calm and focused.  When you’re hungry, you may be tempted to overbuy ‘just in case’ so that you can get out of the store faster.  And, while you may be able to pick up nourishment at a store, but wouldn’t you rather be spending money on long-term purchases instead of unhealthy or overpriced food items?
  4. Carry circulars with you. Can you get a circular in the store?  Probably.  Will you want to battle the crowds for it?  Definitely not.  If you have advance copies of your local store circulars, bring them with you.  Not only will this help you stay focused on your shopping goals, but it’ll enable you to ask for help simply by pointing to the item in the circular, which will spare you from wandering aimlessly around the store.
  5. Take a friend.  The benefits of shopping in tandem are numerous.  For starters, you can split up the store in search of deals, which will shorten the shopping time and prevent you from throwing unplanned items in your cart.  What’s more, having a friend whose opinion you trust can help you decide which purchases are truly worthwhile and which items you can live without.
  6. Save your receipts.  It’s easy to lose receipts during the shopping frenzy, but it’s important to make sure that you keep your sales slips organized and accessible.  You may find the same item for cheaper in another store, or you may decide to replace a purchase with another one that you find later in the day.  You may also decide that something you’ve bought isn’t quite as great as you thought, and you just want to return it.  No matter what the reason is, having the receipts handy will make your life much easier.
  7. Rest up.  It’s a well-known fact that exhaustion leads to poor decision making, and since many Black Friday shoppers shop in the middle of the night or the wee hours of the morning, resting up in advance can give you the energy and clarity of mind you’ll need to avoid making poor choices.  Luckily for you, Thanksgiving is a national holiday so you should be able to sneak in a nap before you shop.
  8. Wear comfortable shoes. If you plan on spending hours on your feet, you might as well be comfortable.  Just keep in mind that if you plan on trying on dress shoes, you may want to bring dress socks or stockings so that you won’t have to try them on with sport socks or barefoot.

Budget Boot Camp 2 – New Month, New Budget

Monday, November 1st, 2010

Welcome to November!  What better time is there to start a new budget than the start of a new month?  And today is anCalculate your budget carefully especially good time to start anew, because Christmas is only 55 days away, and sticking to a budget is a great way to avoid overspending on holiday gifts.  If you’ve never built a budget before, take heed – the exercise can be extremely overwhelming and emotionally draining.  And if you’ve built a budget before but haven’t been able to stick to it, just consider this your opportunity to start anew.

A budget is a very personal thing and it depends on a myriad of factors, the most important of which are your income, your monthly expenses, and your accrued debt.  It’s a really good idea to track your expenses for a month before creating your budget.  But if you haven’t done that yet, you may lose track of your goal – so just jump right in and see where it takes you.  Here are some things to consider so that you’ll build a manageable budget:

  • Housing – I once learned that housing expenses should be no more than 1/3 of your total income.  When possible, they should be less.  If your housing expenses are too high, consider refinancing your mortgage or moving in with a roommate to reduce your costs.  Because housing is a non-negotiable expense, it’s in your best interest to work hard at finding ways to reduce the cost so that you’ll live comfortably without overextending yourself.
  • Food and clothing – It may seem funny to lump these together, but they’re actually quite similar, since they’re both necessities whose expenses can be flexed whenever necessary.  For example, if you need to purchase clothing on any given month, you can purchase cheaper food or eat out less.  Alternatively, if you know that you’ll be having dinner guests, you can cut back on your clothing purchases.
  • Transportation – You may think that you can’t possibly cut back on your transportation costs, but you probably can.  For starters, take a refresher in how to save on gas and other driving expenses.  You should, of course, also consider whether you can get a reduction of your car insurance expenses, and whether you even need your car.
  • Taxes – Sorry, but taxes are a necessary part of every budget, so make sure that you factor in the taxes that you pay.
  • Utilities – There’s no way to cut out utility expenses entirely, but there are ways in which you can reduce your utility costs so that you’ll know they’re as reasonable as possible.  Make sure to turn off lights when they’re not in use and to use the normal cycle on your washer instead of permanent press…little by little you’ll see the savings as a result of your efforts.
  • Debt – The only way to get rid (and prevent it from growing) of it is to pay it off slowly (or quickly, if you happen to win the lottery).  You may already feel constrained by your budget, but failing to include a gradual debt-repayment plan will prevent your budget from succeeding.

Once you’ve done the preliminary calculations for your budget, you’ll see one of three things – your expenses are greater than your income, your income is greater than your expenses, or you’re pretty much breaking even.  If you’re not in the red, congratulations!  Even if you don’t have money for extras right now, hopefully after a few months of sticking to the budget you’ll be able to reconfigure your spending to find some extra cash for retirement, savings or a specific item you’ve been wanting.  If you find that you aren’t earning enough to support your spending habits, you’ll need to either change your spending habits or find a way to earn more money.  But don’t panic – you’re not alone, and with determination and a bit of hard work, you should be able to climb out of the deficit.  I hope to address many of these issues in the next installment of Budget Boot Camp.  Until then, stay focused and positive, and enjoy watching as you take proactive steps to improving your life.