3 Simple Ways to Cut Your Spending and Revive Your Budget

Having some money left at the end of the month to splurge on a luxury or cushion your savings is unusual these days, but it doesn’t have to be an impossible feat.   Augmenting your budget by trimming your expenses always does a financial plan a world of good and is simpler than you might think.

Here are some effective methods that can help you cut back on spending with relative ease:

Track Your Spending

One of the most important money management tools you can use is the spreadsheet, which when used correctly, can make it simple to cut back on your spending.  Keep track of your spending.  All of it.  The most effective way is to track your spending every day.  There are some great apps on the market that allow you to input your purchases on the fly with just a few clicks on your smartphone.  Alternatively, ask for receipts for all of your purchases and log them into a spreadsheet at the end of the day.  Keep an expense journal, or use your online debit card or credit card statement as a reference at the end of the month.  However you choose to do it, don’t leave anything out.  Include any bills you’ve paid and money you’ve lent or spent.  Once you have a clear understanding of where you’re money is going, it’s much easier to see the cost cutting opportunities that are abundant in your budget.  For example, it’s easy to shell out $3.00 each morning for your daily latte, you barely notice a blip in your bottom line, especially when you purchase it with the swipe of a debit card.  But at the end of the month, when you’re examining your expenses and you realize that your morning cup cost you $85, it’s becomes very clear that brewing your coffee at home can save you a bundle over time.

The 24-Hour Rule

Impulse buying can wreak havoc on your budget.  You’re out in the stores or shopping online, and you come across a pair of shoes or a new piece of electronics that you have to have.  Even better, it’s on sale.  It’s easy to rationalize your purchase, after all, it’s on sale, right?  Unless you’re shopping for an essential, wait 24 hours before you pull out your credit card.  Waiting for a cooling off period gives you an opportunity to let that initial impulse pass, providing you with the opportunity to think about your purchase.  If, after waiting it out, you still want those shoes or that big screen television, then go for it.  You’ve had the opportunity to look at your budget, or simply think about the effect it will have on your bottom line for the month.  If it fits into your financial plan, the item is yours.  Chances are, you’ll forget all about it in the morning – and you can put that ‘saved’ cash away for another rainy day.

Coupons and Cash

Tossing away the coupons that come in your Sunday paper is like throwing away cash.  Clipping or printing coupons for items that you regularly use can save you hundreds over time.  In addition, store cards and rewards cards can save you a big part of your shopping budget.  But the savings don’t stop with your groceries.  There are many sites online dedicated to rounding up coupon deals all over the internet.  Whether it’s a percentage off or a free shipping code, the deals are abundant and are worth the few clicks before you make your purchase.

Once you’ve clipped your coupons and handed them to the cashier, follow up by paying with cash.  Handing over your cash versus swiping your card makes your spending more real.  You can feel the effects of your purchases when shopping with cash – it depletes with each purchase you make.  When you can actually see your money going, it has a different psychological effect than simply swiping your card all day.  Unfortunately, with credit cards, you won’t see how fast your purchases add up until the end of the month, and unless you can pay your card balance in full, your purchases will cost you even more when you tack on all of the interest.

Managing your money isn’t as difficult as many might think.  There are many simple, yet clever ways to stretch your budget each month, but it all starts with knowing how much you spend.  It’s never to late to start.