I’m closing on a home next week, which should be no big deal, except that after twenty years I am doing it as a single parent. There is the unavoidable feeling of being in over one’s head, wondering if you will in fact be able to make the payments, pay your bills, and still have enough left over to put away for your sunset years.
The process is forcing me to become more frugal. My divorce meant saying goodbye to a spouse with major income, so I can no longer just buy whatever I wish. I have to look at price tags, make judgment calls, determine if it is really worth it. Invariably I look at every purchase as how many hours of my work week it will take to pay it off. It makes you adjust your goals rather quickly.
First of all, you must determine where your money is being spent, and adjust accordingly. On my Discover Card site, they allow you to break down your bill into categories, see how much is spent on restaurants, gas, retail, etc. You can then alter your horizons from that point.
At the risk of sounding like a mother hen, one of the best ways to save money is couponing. I used to tease my ex-wife about the amount of time and effort spent clipping coupons. But now I understand the method to her madness. It actually does save money! I’m not saying you have to become as OC about it as she was, but it never hurts to look through and see if you can find coupons for the items you buy most often.
Use a credit card that gives you cash back awards. I use Discover most of the time, and right now I have a couple hundred dollars built up that I can use toward purchases, or paying off my balance, or whatever I wish. Oooh, I wish I hadn’t brought that up; I smell an impulse purchase coming on.
Speaking of which, avoid impulse purchases. If you see something you want (not need, want) go home and sit on the idea for a couple of days. If, after 48 hours, you are still compelled to buy it, then do so. Most of the time, though, you will notice that a little distance and time takes care of most impulse buys.
Lose your landline. Why on earth anybody would have a cell phone and a landline is beyond me. Think of how much a landline and long distance service costs and how much better off you’d be putting that money away every month.
Go to the library for books and movies. Why buy when you can borrow? Most libraries are well stocked with classic books and recent releases, as well as the latest movies and TV shows. As someone with a CD/DVD collection that is darn near the eighth wonder of the world, I can offer visual proof of just how much money goes out the door for such purchases.
Buy used. The last time I bought a new car was in 1994. Ever since then, I’ve bought used. It means lower sticker prices, lower payment, and more money to keep in your pocket. Likewise for other items such as furniture, clothing, etc, all of which can be had used at deep discounts. If you’re going to buy anything new, make it a mattress (there’s just something about a used mattress that makes this author feel “oogy”).
Create an all-purpose wardrobe. Don’t concentrate on buying outfits; buy stuff that will go with other stuff (sorry, I’m a guy and that is about as eloquent as I get when it comes to fashion). Stay away from trendy items that will be out of style in a month or less, and stick to what has been tried and proven.
De-clutter, then put it to work for you. One man’s garbage is another man’s treasure. No truer words have ever been spoken. When you go through and find all the stuff you need to get rid of, don’t stress over the size of the pile, just photograph the items and list them on eBay or Amazon. Trust me, somebody will want this stuff.
Try repairing before replacing. My elderly mother kept saying she needed a new car whenever something would go wrong with hers. I kept advising her to fix her current vehicle, as that would come out far cheaper than incurring a five year car payment. Once the repairs got so numerous that the repairs were costing more than a car payment, well then it was time to trade. Whenever possible, see if repair is an option before you spend the money to replace.
Stay on top of car insurance rates. You can often save a lot of money by just keeping abreast of who has the best rates. I’ve shopped Progressive several times, and despite their entertaining ads, they always came out the most expensive of the other top companies they compared me to. I ended up with Geico, which has been very affordable, but may end up moving again because of an even better deal I recently discovered. Stay on top of your insurance needs.
You don’t have to be a financial whiz to be able to properly manage money. Just exercise a little common sense.