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The Golden Rule of Cheapskating: Spend Less, Save More
It's common sense really: if you spend less, then you can save more.
This is where becoming a Cheapskate gets a little tough. We are all agreed that creating a spending plan (you might call it a budget) and setting goals with a Payment Push is a tough job, requiring focus and attention to detail.
But all that work is for nothing if you don't learn to spend less and save more. One of the first things to learn about living the Cheapskates way is how to cut spending and actually save money. While making a spending plan and setting goals for reducing and then eliminating debt are important, if you can't master spending less and saving more then your efforts will be wasted.
Learning How To Spend Less
This is a step that many people have to confront in order to become a more frugal person and really live the Cheapskates way. You have to learn how to spend less. This is tough for most people since they haven’t had to do anything about this. Learning to spend less is difficult unless you put your pencil to the paper and are determined to make this a goal. Without determination and a goal to strive for, this won’t work.
To begin to spend less, sit down and take a look at where your money has been going. Write down every thing you have spent your money on from fast food restaurants to clothes shopping to grocery shopping, petrol, coffee, phone bills, every cent you've spent, in the last week.
Some people find it handy to get a small notebook that they can carry in their purse or pocket and write down every transaction they make, others prefer to use their phone or tablet. Make sure you write the date at the beginning of each new day and it is helpful to write which day of the week it is to be able to figure out why you are doing what you are doing. Write down every cent you spend, including the bills you pay. If you posted a payment, write down the cost of the stamp if you bought it.
The reason for writing it all down is to find out where the money is going. It's called "tracking your spending". Once you find out how many times a week you are actually eating lunch out and how many cups of coffee you have each day and just how much they are costing you, you’ll quickly figure out where you can cut expenses. We’ll deal with some money saving tips in a moment so don’t begin to panic that you won’t be able to get a large latte ever again.
Once you’ve written all these details down, take a look at what you’re buying. Write down how many times you ate out, how many magazines you bought, how many stops at the local coffee shop and whatever else you might have done.
Total up how much you spent each time you did all these activities. It will become surprising exactly how much money is spent on non-essential things as these. This isn’t a tactic to destroy your spirits, but mainly an eye-opener to begin a plan of action to figure out ways to spend less.
Learning How To Save More
Once you’ve tracked your spending, seen where your hard earned money is really going and taken some time to absorb it all, it is time to learn some valuable money saving tips to help you learn to spend less. Don’t be afraid, nothing discussed here will harm you in any way. These are basically a set of guidelines created to you through the process of spending less money.
Take the list of all the places you have spent money at for the time period you kept a record. Are there any transactions that you can cut? Maybe decide that instead of stopping at the coffee shop each morning, get yourself a coffee maker, buy some pods and make yourself a coffee at home each morning. Put the coffee into a thermos and take it to work with you.
If you don’t want to do that, use the coffee maker to brew two cups of coffee, enough to put into an insulated travel mug to carry to work. You’ll still get your coffee, but won’t be spending eight dollars a day to have it (that's a saving already). You can also buy flavored coffee from the supermarket or even make your own for a fraction of the price (that's an even bigger saving).
Are you able to take your lunch to work? Instead of spending seven to ten dollars a day on lunch out, grab lunch options from the supermarket while you are doing the weekly grocery shop. The same can be done for dinnertime. Look at the price of buying a frozen pizza at the store and buying one from the local pizza delivery store.
The difference is at least five to ten dollars each. Then compare the price of making your own at home (see Penny Pinchin Pan Pizza) for even bigger savings and much, much nicer pizzas.
If you do have to eat out, whether it’s for work or pleasure, don’t be afraid to use coupons for a percentage off or a certain dollar amount off the final price. It is best to save a few dollars than to worry what people will think of you and the coupon you just used. They might even be jealous!
You can turn eating out on a budget into an incredible socializing event by making it a competition. Take it in turns with your group of friends to find the nicest, cheapest restaurant or cafe and have a standing date once a month or so. At the end of the year, whoever has found the best and cheapest restaurant gets their dinner paid for by the group at the next outing. We have found some of our favourite restaurants this way, and really enjoyed the company of good friends, often for under $25 a couple.
Look back at your list and look at how you paid your bills. Did you mail them or drive to where they needed to be paid? Most companies these days give you the option of paying your bills online or by direct debit (and in fact they prefer it). Not only will you be saving the money on stamps, but petrol and time as well. Some companies even offer discounts on your monthly bill for paying them online or by direct debit; it pays to check your statement to see if this is an option, and if it's not on the statement, ring the company and ask!
Take a glance at the amount spent on fuel for your car. Petrol prices fluctuate often, up and down all week long, and often going up without warning, which can cause your expenses to rise and lower at a moments notice. Think about the amount you travel for a moment. Is it possible to take public transport to work or the shops? Is carpooling an option? The goal is to cut down on how much petrol you use and easy ways to do this include public transport, carpooling and walking, which is good for other reasons. If you are spending a large proportion of your income on petrol and maintenance on your car, would downsizing (or upgrading, depending on what vehicle you have) be an option that would cut this expense and free up some money to be saved?
One final example is looking at how much you are spending on things like buying clothes or make-up or hobby materials. Consider a swap night with friends. If five or six of your friends get together and swap clothes or books or craft materials or toys or whatever, you're all getting the things you want and/or need, free.
Check out one of the services where you can rent movies online for a flat fee each month. This is helpful if you like to watch a lot of movies all the time and are spending a good portion of your income at the cinema. We have Netflix and we all enjoy the subscription. The kids give it to Wayne as their Father's Day gift each year. It means he gets a gift we can all use, and they can give him a gift he loves within their budgets. Look for discounts for new accounts and take advantage of them.
Saving the Money
Now you have learnt where to save and how to save you actually have to do it. You haven't really saved a cent until you have put the money in the bank so open a savings account (if you don't already have one) and then when you do make a saving on a spend, put the amount saved into the bank. Immediately. No procrastinating.
And remember: it's not saved until it's in the bank, until then it's just not spent yet.
This is where becoming a Cheapskate gets a little tough. We are all agreed that creating a spending plan (you might call it a budget) and setting goals with a Payment Push is a tough job, requiring focus and attention to detail.
But all that work is for nothing if you don't learn to spend less and save more. One of the first things to learn about living the Cheapskates way is how to cut spending and actually save money. While making a spending plan and setting goals for reducing and then eliminating debt are important, if you can't master spending less and saving more then your efforts will be wasted.
Learning How To Spend Less
This is a step that many people have to confront in order to become a more frugal person and really live the Cheapskates way. You have to learn how to spend less. This is tough for most people since they haven’t had to do anything about this. Learning to spend less is difficult unless you put your pencil to the paper and are determined to make this a goal. Without determination and a goal to strive for, this won’t work.
To begin to spend less, sit down and take a look at where your money has been going. Write down every thing you have spent your money on from fast food restaurants to clothes shopping to grocery shopping, petrol, coffee, phone bills, every cent you've spent, in the last week.
Some people find it handy to get a small notebook that they can carry in their purse or pocket and write down every transaction they make, others prefer to use their phone or tablet. Make sure you write the date at the beginning of each new day and it is helpful to write which day of the week it is to be able to figure out why you are doing what you are doing. Write down every cent you spend, including the bills you pay. If you posted a payment, write down the cost of the stamp if you bought it.
The reason for writing it all down is to find out where the money is going. It's called "tracking your spending". Once you find out how many times a week you are actually eating lunch out and how many cups of coffee you have each day and just how much they are costing you, you’ll quickly figure out where you can cut expenses. We’ll deal with some money saving tips in a moment so don’t begin to panic that you won’t be able to get a large latte ever again.
Once you’ve written all these details down, take a look at what you’re buying. Write down how many times you ate out, how many magazines you bought, how many stops at the local coffee shop and whatever else you might have done.
Total up how much you spent each time you did all these activities. It will become surprising exactly how much money is spent on non-essential things as these. This isn’t a tactic to destroy your spirits, but mainly an eye-opener to begin a plan of action to figure out ways to spend less.
Learning How To Save More
Once you’ve tracked your spending, seen where your hard earned money is really going and taken some time to absorb it all, it is time to learn some valuable money saving tips to help you learn to spend less. Don’t be afraid, nothing discussed here will harm you in any way. These are basically a set of guidelines created to you through the process of spending less money.
Take the list of all the places you have spent money at for the time period you kept a record. Are there any transactions that you can cut? Maybe decide that instead of stopping at the coffee shop each morning, get yourself a coffee maker, buy some pods and make yourself a coffee at home each morning. Put the coffee into a thermos and take it to work with you.
If you don’t want to do that, use the coffee maker to brew two cups of coffee, enough to put into an insulated travel mug to carry to work. You’ll still get your coffee, but won’t be spending eight dollars a day to have it (that's a saving already). You can also buy flavored coffee from the supermarket or even make your own for a fraction of the price (that's an even bigger saving).
Are you able to take your lunch to work? Instead of spending seven to ten dollars a day on lunch out, grab lunch options from the supermarket while you are doing the weekly grocery shop. The same can be done for dinnertime. Look at the price of buying a frozen pizza at the store and buying one from the local pizza delivery store.
The difference is at least five to ten dollars each. Then compare the price of making your own at home (see Penny Pinchin Pan Pizza) for even bigger savings and much, much nicer pizzas.
If you do have to eat out, whether it’s for work or pleasure, don’t be afraid to use coupons for a percentage off or a certain dollar amount off the final price. It is best to save a few dollars than to worry what people will think of you and the coupon you just used. They might even be jealous!
You can turn eating out on a budget into an incredible socializing event by making it a competition. Take it in turns with your group of friends to find the nicest, cheapest restaurant or cafe and have a standing date once a month or so. At the end of the year, whoever has found the best and cheapest restaurant gets their dinner paid for by the group at the next outing. We have found some of our favourite restaurants this way, and really enjoyed the company of good friends, often for under $25 a couple.
Look back at your list and look at how you paid your bills. Did you mail them or drive to where they needed to be paid? Most companies these days give you the option of paying your bills online or by direct debit (and in fact they prefer it). Not only will you be saving the money on stamps, but petrol and time as well. Some companies even offer discounts on your monthly bill for paying them online or by direct debit; it pays to check your statement to see if this is an option, and if it's not on the statement, ring the company and ask!
Take a glance at the amount spent on fuel for your car. Petrol prices fluctuate often, up and down all week long, and often going up without warning, which can cause your expenses to rise and lower at a moments notice. Think about the amount you travel for a moment. Is it possible to take public transport to work or the shops? Is carpooling an option? The goal is to cut down on how much petrol you use and easy ways to do this include public transport, carpooling and walking, which is good for other reasons. If you are spending a large proportion of your income on petrol and maintenance on your car, would downsizing (or upgrading, depending on what vehicle you have) be an option that would cut this expense and free up some money to be saved?
One final example is looking at how much you are spending on things like buying clothes or make-up or hobby materials. Consider a swap night with friends. If five or six of your friends get together and swap clothes or books or craft materials or toys or whatever, you're all getting the things you want and/or need, free.
Check out one of the services where you can rent movies online for a flat fee each month. This is helpful if you like to watch a lot of movies all the time and are spending a good portion of your income at the cinema. We have Netflix and we all enjoy the subscription. The kids give it to Wayne as their Father's Day gift each year. It means he gets a gift we can all use, and they can give him a gift he loves within their budgets. Look for discounts for new accounts and take advantage of them.
Saving the Money
Now you have learnt where to save and how to save you actually have to do it. You haven't really saved a cent until you have put the money in the bank so open a savings account (if you don't already have one) and then when you do make a saving on a spend, put the amount saved into the bank. Immediately. No procrastinating.
And remember: it's not saved until it's in the bank, until then it's just not spent yet.