I’ve been told by several people recently that they can’t afford to live on what they have.  I get that prices on most things have gone up and it’s harder.  But, my answer to them is…. have you looked at what you’re spending?  Do you have a budget?  If so, have you updated it recently?  

In many cases, people find they’re wasting money.  For example, are you buying coffee out or making it at home and using a thermos?  How often are you eating out?  Have you looked at your cable bill lately?  Is it outrageous and could you cut there?  Have you shopped for insurances lately to see if you can get a better price for the same coverages?  Do you still need a home phone or can you live with just your cell service?  Perhaps it’s time to do some real soul searching about your spending habits.  Hard decisions may need to be made.  And if you haven’t already created a budget, it’s time.

Yes, I’m aware that if things are really bad,  there are government programs available.  There are food pantry’s, and thrift stores.  But those should be considered short term solutions, not permanent.  You want to get back on your feet as quickly as possible.  So create that budget and see where you’re at.

A real life example:

For example, someone I know spent WAY too much for a car.  They just HAD to buy new when a good used car would have saved them a lot of money.  To keep the payment affordable, they took out a 7 year loan.  They were underwater with the vehicle for most of the loan term.  Underwater means they owed more on the car than it was worth.  

Now the car is paid for, has a ton of miles on it and is racking up repair bills.  Soon, she’ll go into heavy debt for another vehicle.  If she had bought a good used car, she could have had a much lower payment for a shorter term, and had the car free and clear.  Once paid for, she could have put the previous car payments in savings.  She’d have a significant down payment for another vehicle down the road, and still have had a dependable ride.

So what is the moral of this story?

There are ways to cut expenses and you need to take a serious look at what you’re spending.  If I didn’t do a monthly budget, I couldn’t afford to live on my income either.  You absolutely need to know where every penny is going.

 There are a lot of other ways that you can save money.  For grocery shopping, use coupons and shop sales.  Go to discount grocery stores.  If you’re not sure where discount grocers are located, do an internet search.  I did and three popped up in my area.   If you NEED a vehicle, purchase a good used car, not a new one.  If you need clothing, shop thrift stores.  Be creative and find some great saving methods.  Share your ideas!