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How to Maximize your Spending Plan (AKA Budget)

Maximize Spending Plan

Get the Most for the Least by Shopping Carefully

Budgeting can be like strong tasting medicine – it’s one of the most challenging remedies to take, but its effectiveness cannot be denied.  Whether you’ve got money troubles or not, a budget will help your finances.  You don’t make a budget just to fix problems – you have to do it all the time.

A spending plan is more than just a list with numbers.  It’s a willingness to do things that may seem inconvenient at the time, but add up to a considerable advantage when you’re looking to cut costs, without sacrificing quality.

Here are some everyday actions you can take that will make your bottom line look better:

Check Prices
Ok, so you’ve decided to make a purchase, and you’ve budgeted for it.  Before you expend precious funds, make sure you’re getting the best value for your dollar.  Ask yourself the following:

“Can I save money by buying used?”  A lot of times, a used item will serve just as well as a new one.  Appliances, for instance, are often available used, many from dealers who will offer a warranty.  Clothing, too. Many discount stores offer name brand clothing, gently worn, at a fraction of the original cost.  If you’re ok with previously enjoyed clothes, you’ll find that you can start dressing really well for really cheap.

“Is another store having a sale on this item?”  Is the sale good enough to justify the extra travel time and expense?  Try to avoid paying more just for convenience.

“Is it less expensive online?”  Sometimes it’s worth having to wait a few extra days for delivery.

Prepare your Own Meals
We can’t stress enough just how much impact this one simple act can have on your bottom line.  Take out or delivery costs several times as much as preparing a similar item at home, and when you make it yourself, it’s how you like it.  Compare the savings to the time spend preparing meals, and it’s like you’ve got another job that pays really well.

Clip Coupons
There are often coupons and manufacturers discounts on items, especially groceries.  Watch the flyers that come to your house (you have to pick them up off the porch anyway).  Very often, you can find some pretty valuable discounts (dollars, as opposed to cents) on items you were going to purchase anyway.  Many grocery stores now “price match,” which means that they will honour competitors sale prices.  There are apps for your phone you can use on your phone to collect sale prices and get them all at a single store.

Store Brands
Very often, the grocery store-branded items are processed in the same plants that turn out the national brands.  The money you save is a direct result of the lack of advertising for the store brand.  Experiment, and find the ones you like best.

Feeling overwhelmed by debt?  Do you need help with budgeting and other financial control measures? Contact Creditaid for a free consultation today!

How to Spend Less on Food

A recent joint report between Dalhousie University and the University of Guelph states that “The average Canadian family is going to spend $411 more to fill the grocery cart.”

That’s a huge increase in your household budget – equivalent to receiving an extra heating bill or two.  Many people believe that this is a relatively fixed cost and that they would have a hard time reducing it without sacrificing greatly at the dinner table.  We don’t think that’s entirely true. Here are some things you can do to reduce the cost of feeding your household next month:

Cook at home instead of eating out

This is the number one, most effective way to reduce food costs.  Dining out, whether fast food or fine dining, cost a lot more than preparing your own food.  As a bonus, you’ll likely be healthier, and when you prepare your own meals, you always know that they’re made to your liking.  You might miss the convenience of fast food, but after a few weeks of home-cooked meals, you won’t miss the food.

Take your lunch to work

This is an extension of the above rule – buying lunch at an average cost of ten dollars per day will add up to over $2000 per year to the budget.  That money can buy a lot of sandwiches, and perhaps pay down debt. When you’re preparing your own meals at home, it’s possible to cook a little extra every night for lunch the next (or even the following) day, which will help you reduce your costs even more.

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Build Learn Save Program

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Not everyone knows everything.  Some people are good with hands-on skills, so they enter the skilled trades.  Others may have great people skills and might make a career as a teacher or salesperson.  When it comes to finances, however, everyone, regardless of their strengths or their background, is faced with similar money challenges.

At Creditaid, we’ve developed a program to help you improve your financial situation with our “Build Learn Save” program.  This program will BUILD or improve your credit score. You will LEARN valuable budgeting skills that will help you SAVE money to spend on something important like your first home, a new car, or college education.  It’s an ideal program for individuals who want to take charge of their financial future regardless of their current income and credit situation.

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Call it a Spending Plan, not a Budget!

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Sometimes, the words we use to describe something can affect the way we think about it. “Budget”, like “diet”, is a neutral word, but we often use it to describe something that is restrictive. Nobody really enjoys having to skip dessert, just like nobody really likes counting their pennies to make sure they can meet their obligations each month. Sometimes, however, circumstances dictate that restrictions be made, both dietary and financial. Your mental approach, however, can make a big difference in the psychological effect budgeting can have.

When you make a “budget”, you can easily fall into the trap of thinking negatively. You’ll put it off as long as possible, and rush through it to get it over with, just because you associate it with something unpleasant, which is not having enough money to buy things at will. The more difficult your financial past, the more you are to hate the whole concept of spending restrictions because they’ll remind you of your past issues, and cause you to stress in the present. One of the biggest obstacles to overcoming the financial difficulty is the (wrong) feeling of shame that accompanies it.

If you change the way you think about it, you might be able to change your attitude toward the act of budgeting. Simply calling it a “spending plan” might make it feel like sitting down to balance income with expenses is a good thing (which it is!) and make you dread it less.

Spending plans are necessary, and not only when debt loads are high and income levels are a problem. They’re more important when things are going well – that’s when a lack of awareness of our financial realities can get the better of us, and lead us to overspend, causing difficulties down the line.

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How to Relieve Money Stress

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When we consider all of the stressors in our lives, financial concerns are often near the top.  Money worries can cost you sleep, affect your self-perception and confidence, and often result in denial and a kind of mental paralysis that can cause the problems to worsen, while not making you feel better at all.  And then there’s the issue of shame – we all know that we’re supposed to live within our means, avoid debt, and constantly strive to “put money away” for a rainy day or for retirement.  When we feel like we’re not achieving the goals that we’ve set for ourselves, we get discouraged and stressed.  

Here are a few things you can do to relieve money stress.

Acknowledge the Problem

Financial problems don’t just go away.  Ignoring a creditor’s phone calls isn’t effective in the long term, and only leads to more stress and bigger problems.  Resolve to face the problems right away, and make an action plan.

Take Action

Do something about your situation right away.  No matter how bad the problem is, there are steps you can take to prevent it from getting worse.  Find out what they are, and take them as soon as possible. If you don’t know what to do, consider seeking help. (Read “Seek Help” below).

Don’t Let Money Problems Shame You

Many people experience, at one time or another, financial difficulties.  Money troubles don’t mean you’re a failure and are far more common than you think.  Don’t compare your situation to other people’s.  Your neighbours might appear to be prosperous, but might be drowning in debt you can’t imagine.  Make financial decisions that fit your life.

Seek Help

Financial difficulties can be complex and confusing.  Luckily, you don’t have to go it alone.  Creditaid has been helping Manitobans manage and overcome their debt for more than a quarter century.  We provide credit counselling, budgeting, and other solutions that can help you restore your finances and rebuild your credit.  Take the first step toward a secure, debt-free future.  Contact Creditaid today for a free, no-obligation consultation.

How to Set Up an Emergency Fund for 2019

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Another year has come and gone. For some, it’s been magical, and for others, a little less so. The new year is a time for retrospection, to look back at what’s happened, evaluate where we are, and make preparations for the coming year.

Let us offer you one piece of advice – a few simple steps can give you a whole lot of peace of mind when it comes to securing your financial future. Make 2019 the year that you prepare for unforeseen financial challenges with an emergency fund. The security you’ll feel when you know you’ve protected yourself from an urgent home or car repair, a “blip” in your employment, or any one of a million other unforeseen circumstances is one of the best goals to attain.

How Much is Enough?
The amount of money you need in your emergency fund is really up to you. We’d say, the more the better, but in the end you’ll have to make your own decisions. How much will get you over a rough patch – a month’s salary? Six month’s salary? A thousand dollars? Ten thousand dollars? It’s unpleasant to imagine all of the bad things that can happen to your finances, but it’s important to determine a worst-case scenario to help you set a savings goal.

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