Have you had a big change in your life that is forcing you to live on less financially? Perhaps due to economic hardships, natural disasters, health problems or something else.
Maybe you want to work on paying off your debt so you want to reduce your expenses to have more money to pay off debts.
What can I do to manage my expenses while living on less?
Accept your changed situation.
Learn to adapt to the change in your circumstances. Regardless if this is a personal choice to cut back expenses in order to pay off debt, or if your income has change significantly. Learn how to adjust in your finances to reduce stress and not go into debt or father into debt.
Create a budget.
It is so important to know what money you have and where it is going, down to the penny. Create your budget, for your income make sure to use your net income. List all your expenses, utilities, fuel, groceries, healthcare needs, loans, credit card debt, rent or mortgage, etc.
Make sure to include an amount of money that can be set aside to save for unexpected expenses or emergencies.
Work together as a family.
Make sure you keep communication open with your partner and include children into the communication when necessary and appropriate. Everyone in the family can help support each other and avoid wastefulness and help your money go further.
Prioritize your expenses and make needed adjustments.
Compare your income with your expenses. Are there places you can reduce or eliminate certain expenses? This may mean you will need to forgo going out to eat, cutting back or eliminating some forms of entertainment and finding free things to do.
What are some areas to examine to reduce expenses?
Clothing – Can you get by with what you currently have? If something new is needed, can you find it at end-of-season sales or even shop local second-hand, thrift or consignment stores.
Food – Cook meals at home instead of eating out. Make a shopping list before heading to the store and stick to the list. This will help avoid making impulse purchases. Shop farmers markets, when possible, these can be less expensive. Save leftovers for lunches or snacks.
Transportation – Do you own more than one car? Could you get by with one? Do you have car payments? Could you sell the cars and buy less expensive ones to either significantly reduce the auto loan expense or eliminate it all together? If possible and available, could you use public transportation?
Entertainment – For a time it may be necessary to cancel streaming services, and cable. Find lower cost entertainment options. Check local library for movies and books, play board or card games, work on a puzzle, get outside and enjoy nature.
Utilities – Look for ways as a family to reduce water, electricity, and fuel cost. Turn off lights and take shorter shows can have a big impact.
Future purchases – It is important to have money set aside for emergencies. Outside of emergencies when you want to purchase something, ask yourself, Do I REALLY need it? Can I REALLY afford it? If an appliance is broken, would it be worth repairing instead of replacing?
Income Tip:
Create other income – Are there things in your home that you can sell? Clean out the closet and sell clothing items you are not wearing. This can be done online or even taken to a consignment shop for resale. What about home décor items, shoes, books, or other items that you no longer need?
Let’s do a budget review.
Regardless whether you have a budget already or want help creating one I am here for you. Schedule your free consultation call HERE and we can discuss your current situation and budget. I want to help you eliminate the financial stress and anxiety in your life, so you can live the life you want.