As usual, when I start to write a post about budgeting every month, I think why do I do it?
Why don’t I just delete the whole category of “budgeting” and save myself the trouble.
They’re the least read posts (trust me, thanks to Google Analytics, I can tell), they’re not sexy or pretty to look at – and I’m saying this. Me. The person who’s writing this stuff.
While this all may be true, budgeting is the most important category and here’s why: You can buy a shirt used (vs new) and get the benefit of saving money on that shirt but the real savings, or “How Finances Figure in Frugality”, are the behind the scenes benefits of frugal living. Dollar for dollar these far outweigh the effort or savings of that shirt you just bought and there’s no social stigma.
These are some big items that payoff frugally but are not what first comes to mind when you think of “frugal living”…
How Finances Figure in Frugality
Don’t be fooled. It can be expensive, even if your employer contributes toward the premium. If you’re healthy, consider purchasing an individual policy. Our individual policy may be considered “catastrophic coverage” to some but if you’re healthy, take care of yourself, and exercise, how many times a year are you going to the doctor? If you’ve lost your job think twice before signing up for COBRA. In most cases, it’s much less expensive to get an individual policy for you and/or your family. What about dental insurance? Even our dentist told us it’s not worth purchasing it if you have good home care. Why? Because the cost of the insurance is going to be more than just paying as you go.
If you want to buy a house, make sure to put enough money down so you don’t have to pay PMI (private mortgage insurance) and get some skin in the game! If you can’t afford 20% down for a down payment then maybe you’re buying more house than you can afford. You don’t have to listen to the bank. When they say, “You can afford this much house”, think long and hard about it. Purchase a house for less than the amount the bank says you can afford. Every month, you’ll be thankful.
Pay off your balance each month or don’t use one. Simple. Live within your means. If you do use a credit card, review your statements! Yes, I’m yelling! Check your receipts against your statement every month. Come into contact with what you have spent. It only takes a few minutes to do this but you need to make sure no mistakes were made, no double charges, and all credits are accounted for. Bring it with you on an errand while you have to wait. I do it during piano lessons (before I doze off in the chair…).
Come on, now. Really, do you really need this? Don’t be a spectator in life and waste time in front of the TV. It’s expensive so don’t pay for it. Must see a show? Get it from your library. You might also pick up a book or two on investing or budgeting while you’re there. I can honestly say I have no idea who “Snooki” is and couldn’t pick her out of line up if I had to. Yes, friends, that’s all thanks to no cable TV.
There you go. These are a few of the big things that can provide substantial savings in your life. Being frugal is about the small and large things and the great thing about it is the more you do it, the more you realize the benefits, the easier it gets.
What’s part of your big picture? Do you get caught up in the little things?
Go Gingham related links:
Tried and true investing strategies – a question asked by Annie!
Just balance that checkbook! You can do it!
Debt – you decide on the level you’re comfortable with
What does it mean to budget? Find out here
Frugal living is the key to saving
The problem with budgeting – yes, the problem!
How finances figure in frugality
How to save money on your smart phone bills – great tips from readers!