Saturday, November 8, 2008

Personal Budgeting: 6 Money Savings Tips for Today’s Economy

Are you making any changes to your personal spending habits due to the economic crisis? Have your re-evalutated your family budget to determine where to cut back spending? How much have you told your kids about your money situation? As a full time career mom I pay for convenience. I don’t have the time to scour the sales, I pay extra for pre or partially made dinners and we order take out probably more than most but….

Today is still a good time to sit back and assess wants and needs and understand that even little changes go a long way. Here are 6 things I have done in the past couple of weeks.

  1. Credit card balances. Thankfully, I don’t have much on the cards but there is still no reason to pay interest rates just so I can keep some extra money in my pocket…which I will inevitably spend any way. So, I scraped together what I could and just paid off my balance. Do I have less in my pocket? Yes…but that’s a good thing…now to not bring out the plastic again!
  2. Water - wow, does my family go through water bottles. It started to get out of control when we would go through 5 bottles at dinner…that’s just wasteful and bad for the environment. Our tap water tastes very good so this is just pure laziness on our part. Now, each night the kids fills up a pitcher of water and leave it in the refrigerator. Bottles are strictly for school lunches…big savings there at $6.99 for a 24 pack of Poland Spring and by drinking tap water we’re actually getting some flouride.
  3. Gasoline - It’s hard to cut down on gas when most of my driving is for my daily commute, but little things help. For instance, I no longer idle when picking up my kids from their destination, I also no longer heat up the car before I get into it - yes I freeze for a few minutes but come on, we can all suck it up a bit, right?
  4. Food - Prices seem to have no limits and even though gas prices have decreased recently, food prices have not followed that trend. My food bills are frightening but now I’m even more focused on the sales. When something goes on sale, like pasta I buy a dozen boxes which will generally carry me a few weeks until it goes on sale again. At the supermarket sale items generally cycle every 3 weeks, so buy something you know you will use in a 3 week supply and by the time you run out it should be back on sale again.
  5. Educating the Kids - Last night my 10 year old asked me the difference of credit and debit. I defined it simply. Credit is when the bank loans you the money and you need to pay it back with interest. So, basically your $50 Wii game comes with 10% interest so you actually pay $55 for it - $50 goes to pay for the game and $5 goes to the bank for the privilege of letting you borrow the money. And, if you take too many months to pay off the game, the bank keeps adding fees and you could actually end up paying more than $50 in fees alone…where all those fees could have gone to save up for another game! My explanation for debit was it’s the same as a checking account. You can only spend money if you have it in the bank so if there’s no money in the account you can’t buy it…plain and simple..I prefer debit.
  6. Holidays - See number 5 above. If you drill it into your kids’ heads enough believe it or not they do get it. My kids just started their holiday lists. When I warned them to go easy they moaned, “we know - the economy”. Perhaps they’re tired of hearing it but they each gave me a very short list and said they don’t expect much this year. I would have preferred they said they don’t expect anything…but I’ll take what I can get.

I’m looking for more money saving tips during this economic crisis. What are you doing to cut spending from your family budget? And, how are you communicating your spending cuts to your kids?

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