How to Be Frugal During Hard Times

In a bad economy, you might hear that the guy down the street just got laid off. It could only be a matter of time before that happens to you, so maybe you should look into your finances to see where you stand and find ways to set aside more funds in the event you will need them. <br>Here are a few tips on how you can do that. It’s not only something that’s good to do occasionally; it might be a matter of necessity.

Difficulty: Moderately Challenging

Instructions

1. As they say, “You can’t decide where to go without knowing where you’ve been.” Whip out the trusty calculator and see how you’ve spent your money the past six months. Check your bank and credit card statements where you’ll find most of your expenses. When you have withdrawn money at the ATM machine, try to figure out how you spent it.

2. Based on what you find out, decide if you’re spending money as wisely as you should. For example, are you spending too much at restaurants and not setting aside enough in case of emergencies? Has your child’s college fund taken a back seat to filling your closet? Have you treated yourself and your family to an expensive vacation while allowing necessary repairs on your home to slide? There’s no better time than now to assess your spending habits and make changes to improve the financial outlook for both you and your family.

3. What about accumulated debt? Are your credit cards maxed out and the monthly interest has become more than you can handle? Make a concerted effort to pay these off and stop the interest from piling up. If necessary, talk to your lenders and see if there’s a way that some of your debts can be deferred. However, make sure that your mortgage payments can be made, even if you are suddenly out of work.

4. See if there are ways to reduce your routine costs. For example, most supermarkets offer house brands that are considerably cheaper than the brand names. Do you check the newspaper each week to see what’s on sale? Do you use discount coupons for everyday items? Do you stock up on things you use every day when they go on sale?

5. Make a budget and stick to it. It’s quite simple. Peg future expenses to what you have spent in the past. Set aside money for things you and your family considers important. If, after you do this, you are spending more than you make, that’s where you’ll need to become frugal.

Tips & Warnings

• Go to the supermarket 50 percent less often. You will plan better and you will save money on gasoline.

[Wemmick]

on 10/1/2008 Good ideas, thanks!

[LilacGirl]

on 5/14/2008 Thanks for sharing these frugal suggestions. Good advice.