During these economic times, when we are all tightening our belts and pulling-in the reigns of our credit card spending, there are difficult choices that need to be made about our spending habits. Not only are people deciding to hold off on future purchases, but they are also looking into ways of "trimming the fat" in their current lifestyle. I recently wrote an article that discussed our journey down this road and I feel that it is now time for an update.
As with many others throughout the world, we are struggling with finances and as such, have had to make some tough choices. Some of the items we had to look at was our water delivery service, Direct TV, and our phone service. Over three years ago, we decided to rent a water cooler and have water delivered to our house. This was great, because it allowed us to give filtered water to our animals and we also had hot or cold filtered water available all the time. However, it was expensive, averaging $40.00 per month, so we decided to cancel the service and purchased a Brita. The money being saved is currently being redirected to a credit card bill.
As with the phone service, it is also costing us over $44.00 per month and we are currently in the process of canceling it and just using a cell phone. My wife currently has a cell phone, so we decided to pay $10.00 more each month and get one to use around the house. Again, the money saved, just over $30.00, will be redirected to a bill. Now, that just leaves DirectTV to consider. As you may know from reading my profile, I am a stay at home dad and I also home school our kids. In addition to preparing lesson plans and teaching myself the material (so I can present it in such a way as to be understood), I also have general housework to do, and I still need to devote time to writing articles and generally maintaining my site. With this being said, about the only thing I feel like doing at the end of the day, is watching television.
Our family has a few favorite shows such as Ghost Hunters, Ghost Hunters International, Deadliest Catch, and Top Gear, to name just a few. Luckily, Direct TV Options are many, as they have a wide variety of services from which to choose. These packages range from the lower-priced family-friendly channels to the mega-priced, “I have money to burn and way too much time on my hands” packages. We currently have the Total Choice Plus package, which is a mid-range package, and it includes all the channels we like, plus many others we could care less about. It would be wonderful if they would allow us to customize our own package and adapt it to the lower-priced services, but until I see pigs flying through the air, that probably won’t happen.
I realize that everyone’s lifestyle is different and we each will have different areas in our lives where the fat can be trimmed. It is a difficult choice, because these services have become so ingrained in our lifestyle, that it can feel like parting with an old friend. As we think about where we have been and where we are going, it is imperative to try and make these decisions from a budgeting point of view. Basically, try to look at the bottom line and see what you can cut from your monthly budget, yet still maintain an emotionally healthy lifestyle. As for us, we will revisit our decision regarding Direct TV at the start of each month. For now, we can still afford to keep it but, as with anything else, that too may change. Good luck to you all and remember: you are not alone in this.
Showing posts with label budgets. Show all posts
Showing posts with label budgets. Show all posts
15 March 2009
02 February 2009
Putting Your Budget on a Diet
Yeah, you heard me correctly. It's time to put the old budget on a much needed diet. I figure since I have bored you all to tears with my weight loss journey, I might as well capitalize on this theme and take it to another level. Due to our current situation, I am in the process of creating a new budget; one that we can actually work with. So, I'll take you all along for the ride.
First thing to do is to gather all your bills and place them on the table in front of you. You will need to include every bill you pay on a regular basis: Mortgage, insurance, credit cards, sewer, water, garbage, Association fees, phone, cable, gas, electric, fuel, food, and any other ones you may have. These constitute your fixed expenses. If some of them are billed on a quarterly basis, then you will need to divide that amount by 3. If billed on an annual basis, then divide by 12. You will most likely have some bills that fluctuate from month to month, so in order to get a rough estimate, try and get your bills from the previous year and average them out. Once you get a monthly total, you will have a pretty good idea of where you stand.
The next part of this budget is going to seem rather odd, but it will really be an eye-opener. As you go through your day, whenever you buy something write down a description and the amount you paid. Keep a diary of these purchases for at least one week. At the end of the week, add-up everything you purchased and take a look at the total. Most likely, you will be surprised at where your money goes. The $5.00 cup of coffee or the $1.50 spent on a snack may not seem like a great deal at the time, but it adds up over the days.
Now that you have a better picture of where your money is going, you will be in a much better situation to begin re-allocating your money to where it is most needed, for example paying off those credit card bills. If, by chance, you find that you are over-budget, you will need to take a hard look at your current expenses and decide where you can cut some fat. Look around and try and find things that you Really don't need. For example, do you currently have cable and subscribe to every service they offer? Try and look into cutting back to a more basic service. Ask yourself, do you really need all those movie channels? How often do you watch those movies and how often do they actually play movies you care to see? What about canceling that expensive service and putting your money elsewhere. If you really need your movie fix, what about joining Netflix or Blockbuster. That way you pay for only the movies you want to see.
In our case, it's water delivery. We get bottled water delivered twice a month and shell-out around $48.00 for the privilege. Now, the water itself is not that expensive, it is the rental cost of the dispenser which drives the price up. So, we are currently looking into discontinuing that service. Thus, we can steer that money towards one of our bills.
To sum up, my point here is to try and give you tips on how to visualize your current financial situation. If you can actually see where your money is going, you will be in a better situation to be able to control your finances, instead of them controlling you.
First thing to do is to gather all your bills and place them on the table in front of you. You will need to include every bill you pay on a regular basis: Mortgage, insurance, credit cards, sewer, water, garbage, Association fees, phone, cable, gas, electric, fuel, food, and any other ones you may have. These constitute your fixed expenses. If some of them are billed on a quarterly basis, then you will need to divide that amount by 3. If billed on an annual basis, then divide by 12. You will most likely have some bills that fluctuate from month to month, so in order to get a rough estimate, try and get your bills from the previous year and average them out. Once you get a monthly total, you will have a pretty good idea of where you stand.
The next part of this budget is going to seem rather odd, but it will really be an eye-opener. As you go through your day, whenever you buy something write down a description and the amount you paid. Keep a diary of these purchases for at least one week. At the end of the week, add-up everything you purchased and take a look at the total. Most likely, you will be surprised at where your money goes. The $5.00 cup of coffee or the $1.50 spent on a snack may not seem like a great deal at the time, but it adds up over the days.
Now that you have a better picture of where your money is going, you will be in a much better situation to begin re-allocating your money to where it is most needed, for example paying off those credit card bills. If, by chance, you find that you are over-budget, you will need to take a hard look at your current expenses and decide where you can cut some fat. Look around and try and find things that you Really don't need. For example, do you currently have cable and subscribe to every service they offer? Try and look into cutting back to a more basic service. Ask yourself, do you really need all those movie channels? How often do you watch those movies and how often do they actually play movies you care to see? What about canceling that expensive service and putting your money elsewhere. If you really need your movie fix, what about joining Netflix or Blockbuster. That way you pay for only the movies you want to see.
In our case, it's water delivery. We get bottled water delivered twice a month and shell-out around $48.00 for the privilege. Now, the water itself is not that expensive, it is the rental cost of the dispenser which drives the price up. So, we are currently looking into discontinuing that service. Thus, we can steer that money towards one of our bills.
To sum up, my point here is to try and give you tips on how to visualize your current financial situation. If you can actually see where your money is going, you will be in a better situation to be able to control your finances, instead of them controlling you.
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