5 Budgeting Considerations You Might be Overlooking

rakwriter By rakwriter, 26th Jan 2015 | Follow this author | RSS Feed
Posted in Wikinut>Money>Money Saving Tips

Some people don't budget because they figure there's nothing they could change about their lifestyle. That may be true in a few cases, but there are some considerations to look at before you dismiss budgeting altogether.

The Problem

Budgeting is hard. As I wrote in another article, there is an emotional component that is far too often overlooked. It is also true that--according to a Bankrate.com survey on June 23, 2014--as many as 76% of Americans are living paycheck to paycheck. Creating even the slightest wiggle room is a daunting task, but it can likely be done.

Consideration #1: Entertainment

In writing about the emotional component of money, I mentioned that one should plan to have an entertainment budget. However, there are entertainment avenues that can be kept, sold, thrown out, or replaced to save money. The most obvious is probably satellite and cable TV. Get rid of those expenses, and start watching movies on DVD or Bluray. Read a book instead of watching TV.

Internet costs can also stack up. Of course, few people can get along in the modern world without the Internet; it's how we've grown to keep in touch with friends and family, sometimes across the globe. Still, there are people who can live without it. Try to go a week without using the Internet. If you can do it, or all you do on the Internet is for recreation, consider cutting your Internet at home. Many libraries have Internet access, and a library card may cost as little as one dollar, if it costs anything at all.

Consideration #2: Alcohol and Tobacco

Cigarettes, cigars, chewing tobacco, and alcohol should be considered non-essentials. Remember when your cigarettes cost £4.51? Now they're probably around £8.74, right? For Americans, that's kind of like when a pack of cigarettes was $2.50, and now it's $5.00. The taxes on cigarettes may seem unfair, but there's little we can do about it.

Here's the thing, though: suppose you're spending just £4.51 on a pack of cigarettes, and you only smoke 1 cigarette a day. That's still £82.31 a year (about $124.16 American dollars as of January 2015). Now, if you smoke five cigarettes a day, that's £411.54 ($620.56). A pack-a-day smoker would spend £1646.15 ($2,482.81), and remember, that's at £4.51 ($6.80) a pack.

You can do the same math for alcohol, but the cost of a beer is not the same as the cost of a bottle of rum, and that's not the same as a bottle of wine. Still, just take a look at how much you're drinking in a month and multiply it by twelve. That's how much money you could be spending on paying off your debt or other expenses.

Is quitting smoking difficult? Sure. No one said being eventually debt free was going to be easy, but if quitting smoking or drinking was your ticket to living debt free and financially independent, you'd probably want to consider it.

Consideration #3: Junk Food

People--especially Americans--love their junk food. According to DoSomething.org, 52% of Americans polled in 2012 said doing taxes was easier than figuring out how to eat healthy. As many as 25% of Americans eat some type of fast food every day. We drink sodas, eat candies, scarf potato chips (crisps) and of course, there's the Big Macs, Whoppers, and other fast food.

Cut it out. It's not difficult to eat healthy, though it's not as "fun" as eating junk food. Change one thing a day. Instead of a candy bar, eat an apple. Instead of that bag of crisps, have some celery with peanut butter or salad dressing. Drink water instead of soda. Skip Starbucks and brew a pot of coffee or tea at home. Eat grapes instead of candies.

Healthier food tends to be sold in larger portions. Sure, you can buy one apple, but most people will buy them in a larger quantity. When you buy junk food, it's usually designed for one serving. You'll spend more at the grocery store for ten apples than you will on ten candy bars, but your apples will also feed more. Cut an apple in half for a snack and store the other for later.

Over the course of a month, you'll find that buying healthier foods will last longer (especially when you freeze unused portions), and you'll save money.

Consideration #4: Your Cell Phone

When you mention cutting cellular phones or their features, "them's fightin' words," as the saying goes. People are more in love with their phones than they've ever been, but the latest and greatest phones aren't a necessity. You don't need an iPhone or a Droid Maxx. You don't need data if all you do on your phone is recreational browsing online. If you don't text, you might be wasting money if your carrier has texting as a feature.

There are ways to get your cell phone bill lowered. Call the customer service center listed on your bill. Always, always, always be polite. The minute you get frustrated and make a comment at the representative's expense, you've lost options. Ask them to take a look at your data usage, minutes, and texts. If your plan is allowing more than you need, ask the representative if there's a way you could cut any costs.

That really cool ringback tone service? Nix it. Those apps you don't use that you're paying for? Lose them. Cancel and cut until you've got only what you need, or as close to it as you can get it. When you upgrade, see if there's a way to avoid being caught in a contract. See if you can get a phone that doesn't cost as much, if anything at all.

You can survive without all the bells and whistles on your phone, I promise. I use a pay-by-month phone that doesn't tie me into a contract, and it costs me $40 for unlimited text, talk, and data every month. If I had a more basic phone, the company would let me spend less, but they stipulate their most widely available models use their unlimited plans.

Still, I spend $40 (£26.52) a month on my cell phone, and the phone itself was $50 when I bought it. Can I do everything an iPhone can? No, but I can do everything I need to do on it. What are you spending, and where could you be saving? If you see any charge on your cell phone you don't understand, call the customer service center and ask what it is, and if you can lose it.

Consideration #5: The Savings Trap

If you're getting stuck in the coupon trap, you're losing money. Only use coupons if you have a "buy one, get one free" offer, or--if it's a "buy one, get the second at half price" coupon or something similar--make sure you need two of the item. If the second is just going to go to waste or sit on a shelf somewhere, you've thrown money away.

We see a lot of offers in the world that are meant to entice us into spending more. Avoid impulse buying when you see a "deal." Make up your mind what you need, and don't buy any more than that. When you go to the store and the cashier offers a membership, don't bite unless you shop there often enough that the savings you'll get as a member will justify the cost.

Advertising is clever enough to make spending look like saving, but if you're shopping, you're only ever spending money. When you see a deal, examine it carefully. No one says you can't park yourself out of the way in a grocery aisle to pull out a calculator and do the math. When it's your money, it's your job to handle it responsibly. Take the time to slow down and be responsible with your income.


Budget, Expense, Finance, Financial Freedom, Money, Saving, Shopping, Spending

Meet the author

author avatar rakwriter
Rob is an aspiring author living in Colorado Springs. When he's not writing about finances, social issues, or zombie culture, he spends his time working on his debut novel.

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