One way to reduce spending, stick to your budget, and reduce debt is to place priorities your spending choices. Have you ever wondered how to choose categories most important to your family? What about those categories that ride the line between mandatory expenses or discretionary spending? There are plenty of categories that could be considered either.
Pets: Some people consider buying a pet is discretionary spending, but once you have that pet, the associated expenses switch to mandatory. By owning a pet you have made a commitment to another member of your household and it’s health and well-being should be a priority.
Extra Curricular Activities: Often teetering on the line between mandatory expenses or discretionary spending are the children’s extracurricular activities. It certainly isn’t mandatory that our children participate in expensive, extra-curricular activities such as dance, skating or scouting. But, while we consider it very high on our priority list for discretionary spending, almost to the point of mandatory in the budget, it would get cut before the mortgage or the groceries. We prioritize this for different reasons. My husband places value in learning about teams and physical activity, while I, on the other hand, see the value in community involvement and exposing the children to the multitude of options available to them as they continue searching for things they love to do.
When a choice like this can no longer be a priority, consider low-cost alternatives that might be available in your community. Spend some time volunteering at the local animal shelter to get your pet fix if having one of your own is not an option. The kids will get some social interaction and exposure to culture at the free music concerts held in a local park throughout the summer. Family swim or skating time is often offered at low prices throughout the year and the library offers fun exposure to all sorts of different things. Do some research, get out in your community and learn how your funds can best be spent to socialize your children. Or turn on the music in your living room, nice and loud and let the kids dance from their hearts, I think some nights my kids might have enjoyed that more than their dance class. But, I’ll admit the dance class did provide an awesome opportunity to get up on a big stage in front of lots of parents and family and dance in the spotlight, we couldn’t have quite recreated that in our living room.
Special occasion spending
Trimming the budget on a month-to-month basis can be difficult and you can get derailed from time to time; accept it, tighten your belt, and try again next month. Don’t beat yourself up if you have an expensive month, but don’t ignore it either, just resolve to try a little harder next month, regroup, identify your slips, discuss them with the family and move forward.
One place to actively trim your budget and save the family some money is during your high peak spending times like Christmas, birthdays, other holidays or vacations. Identify your high spend times and bring the family team together to agree to spend less during the next one. Maybe your vacation is just a visit to family, but you let gift giving and eating out put your budget over the edge. Maybe your weakness is exclusive vacation spots, or high-end entertainment choices, concerts, golfing, or scuba diving.
For me, Christmas and birthdays presents to the Coons are my weakness. I am pretty good at saying “no” when faced with the little Coons’ whining in the checkout line at the store, but I go overboard on special occasion gift giving to my kids twice a year.
This past year at Christmas I vowed to spend less because we had just planned and booked our biggest family vacation ever, to Disney World. I started out well, cut back on the volume of gifts and cost, shopped ahead to find some quality second-hand gifts (this is pretty standard for me). But something happened during the last few weeks, I suddenly felt there wasn’t enough and I needed to get more, I don’t even remember what the final panic purchases were or why they felt so important at the time. Then I realized I should have spent my money on suitcases for the kids, something they needed for their first airplane trip, and so even more money disappeared. In the end I blew it, the gift budget that is, but I will try again next year to manage the Christmas spending better.
Take a spending vacation
Just resist spending: Take joy in and celebrate the money not spent today. Some people try a complete spending holiday, where they do not spend money on anything new for a whole month. They purchase the necessities, food, transportation to work, but no convenience stops and no new items. If need you something like a gardening tool, borrow it from a friend or purchased one used.
Though we have not tried this ourselves, I have heard it can be very enlightening, as you are forced to take pause and really think about whether you can do without or try to find an alternative to the item you think you need. I imagine this could be more difficult with kids, but I think worth a try at some point in this journey.
Stick to your budget
Learn your weaknesses and don’t even enter the store that will tempt you. Know your spending limit before you set out for the day. Do your grocery shopping at a grocery store, not a big multi store where new socks get mixed up with your bananas. Some people have more success staying on budget if they shop only with a list, or write the list out and send someone else to your favourite store for you. This way you won’t even have to see the extra temptations.
The little Coons are going to make a list of activities that they can enjoy this summer that won’t cost any money. Ty points out that many of the items on the list require the use of something that originally cost us money, and he is of course right. To continue to use something that has already been purchased validates the original purchase and is OK by me. It is the things that get bought and don’t get used that drive me crazy. So yes, the list will most definitely include the use of their bikes, a favourite family activity, but that is an expense that has paid for itself many times over in fun family adventures and was a wise investment in my opinion.
The books, The Automatic Millionaire, and The Automatic Millionaire Workbook are great eye-openers on how easily money can slip between your fingers and how to make it stop. I’ll be covering them more in depth later.