With all the wonderful things available to us, from fancy food to tech must-haves, it seems boring to save money if you have plenty to go around. But there lies the catch. If you have it, you can spend it. But what if there's not much to go around? What if you're up to your neck in bills and repayments?
The best way to weather these financial hard times is to save money in any way possible. So start squeezing out a little extra cash from around the home. Even the smallest amounts add up. How often have you looked at your bank balance and been completely baffled as to where your money had gone? You convince yourself that it must be credit card fraud. It's not until you've gone back through your statement that cracks in your theory show - you actually weren't thieved. It was just you getting swipe happy with your card on lots of little things like lunches, beverages, small nick nacks and trips to the corner store.
So first things first; you need to know where your money goes. Is it for purchasing necessities? Paying bills? Buying luxuries? You need to know how much comes in and how much goes out so you can see if you can really save.
Collect and save all receipts-from groceries to coffee break snacks-for a month or two in order to see the big picture on your expenses. Also make sure to include any other regular expenses such as personal loan repayments. After you've done that, make a simple list of income and expenses. Keeping track of your purchases will lead you into phase two- making a good budget plan for your household.
Once you've made your list, sit down and analyse it. Separate your needs from your wants - your necessities from your luxuries. You might need to be brutal when deciding what you can spare.
If this is all too boring for you, think about buying personal budgeting software to help you out. Many financial websites that offer online money solutions also provide free online budgeting resources and spreadsheets to aid the process.
You've weeded out the culprits, now it's time to reassess. One of the major players when it comes to monthly household bills is in fact the energy bill. While there is not a lot of room to move, you still have some options. Before you imagine yourself washing your clothes in the swimming pool or living by candle light like cave men, brace yourself for the words... "green" appliances. Yes, these environmentally-friendly appliances can be a little more expensive than the average brand at the checkout, but it will save you a lot in the long run. Why? Green appliances-usually washing machines, refrigerators, television sets and light fittings-need less electricity to function at maximum capacity. Just look out for the energy star rating sticker next time you're in store. It is the easiest way to work out how energy efficient and therefore money saving each appliance is. You can even sell your old appliances in the comfort of your own home through online marketplaces such as eBay or Gumtree.com. It couldn't be easier.
How about saving on food? Groceries can be a rich source of savings. It is one of the easiest and most logical ways to get some immediate cash flow. Avoid eating out often and get back to basics with the meals you cook. Soups are cheap and easy to make in the winter while salads are a quick and cheap solution in the summer. When stocking up on food, read the ingredients on similar products. You can slash a whopping 40 percent savings by choosing another brand which has the same ingredients but is cheaper.
Finally, get rid of that credit card! It might not be something you want to hear, but because credit cards work on a rollover system, you may never see the end of that bill. Although we all know that if you pay your bill each month you wont accumulate interest, how many of us actually demonstrate the self control to do that? If it doesn't cause you any problems, then its fine to keep it for those days when your paycheck doesn't quite make it to the finish line. But if you find yourself continually dipping into the credit card pool without giving any thought on paying it back- it has to go. An alternative for those weeks when you do run short is a small personal loan called a cash advance. While they are more expensive than your credit card in the short run, it could save you thousands of dollars in the long run.
Look for companies that charge flat fees and don't offer rollovers. That way you'll only borrow when you really need to, and will have a pre-determined repayment schedule.
The bottom line? Be savvy with your money. If you're up the creek without a paddle, don't pretend like you're on a 5 star cruise liner. Be honest with yourself about the situation and take the necessary steps that follow. Good luck!
Sean Teahan co-founder of Cash Doctors, Australia's preferred short term lender, shares his insights on money matters. Founded in 2005 Cash Doctors has helped thousands of Australians with their fast cash loans but that's just the short term solution. Cash Doctors also help people in the long run by providing budgeting tools, eBooks and individually researched articles on money matters and financial tips. The aim is to assist people in achieving instant and long term financial freedom.