Frugal is not a term you hear very much any more, but perhaps it needs to make a comeback into our vocabulary. To be frugal means to save money, to conserve your financial resources instead of spending to their limits. How we handle our finances easily develops into a habit. Unfortunately, it is always easier to develop bad habits than good habits. Breaking bad habits and starting good habits, requires self-discipline, something most of us are short on. Here some tips to help you make the change in your spending and saving habits.
Start small. Choose one item or area of spending that you reduce or eliminate, and then place that amount of money in savings each month. If you eliminate your landline and reduce your bills by $30 a month, then put that $30 into savings each month so it doesn’t get spent on something else.
Direct deposit. Make it easier to save by never putting the money in your checking account in the first place. Have your designated savings direct deposited from your paycheck into a savings account that is not tied to your checking account or any piece of plastic.
Track your spending. For one month, keep track of everything you spend, how much for groceries, how much for utilities, how much for dining out, etc. At the end of the month, determine what areas you could decrease and how. Having a specific plan will be much more effect than simply trying to ‘spend less’.
Many people are struggling in the current economy due to lost jobs. Developing frugal habits before a financial crisis hits can be the best safety net you can have.