25 January 2009

Teach yourself to save

There is no doubt about it, things are grim. Jobs and homes are being lost, prices are rising and it looks like it won't improve for a long time yet. I know there are as many different financial situations out there as there are readers but one thing is common to us all, we need to save what we can. If you've never been in the position before of having to cut back and watch your money it's very confronting. But don't be anxious about it, this is just another skill you need to learn, and when you do, you'll get better at it.

If you haven't yet worked out how much you earn and spend in a week or a month, now is the time to do that. You need to work out your current financial situation, start to track your money and then, with your partner, write out a budget that you both stick to. The most important thing to remember is that most of your savings will be small amounts. Don't worry that they are small, they all add up and will make a huge difference over the course of a month and a year. I promise you that when you get to the end of that first month, and when you look back on a full year of cuting back and saving, you'll be as proud as punch. And you should be, you will have made a big difference to your life.

So what are all those small savings you need to teach yourself about? Start at the supermarket because that's where we spend money every week. If you have several supermarkets in your immediate area, go to each one and compare the regular shelf prices, not the specials When you're satisfied that you have the cheapest one that is where you should do your regular shopping each week. But then you should check out the specials and loss leaders of each store by looking at their advertising and flyers - a loss leader is the super special a store will advertise to get you into the store. If the loss leader is something you need, buy it, and leave. Remember, you'll be doing your shopping at the cheapest supermarket from now on. If you have enough money, buy extras of those things you use all the time when you see them on special and start a stockpile.

Other supermarket/food things you can do are:
  • cut down on the number of meat meals you serve during the week.
  • buy generic or store brands - always check the country of origin before buying these and buy from your own country.
  • check your local farmers market, if you have one, they often have the best and cheapest food.
  • use your leftovers.
  • cook two or more meals at once to save the cost of energy, and your time.
  • serve smaller portions if you think your portions are too big.
  • instead of serving a large portion of meat to everyone, serve a small portion and add a dessert at the end of the meal. A nice rice pudding or fruit cobbler will fill them just as much as meat will.
  • Don't buy too much. Make use of everything you buy and don't waste one thing.
  • Make your own bread - it's healthier, cheaper and tastes better.
  • Make your own cleaners - buy pure soap, washing soda, borax and bicarb at the store and make what you need at home. The recipes are here.
  • Pack lunches for work and school.
Other money saving strategies in the home include monitoring your electricity and water meters. Turn off the TV and lights when you leave the room and ask your family to do the same. Turn off the computer when it's not being used. Change your light globes to the energy saving ones.

If you have space, plant a small vegetable garden. Grow what you eat but if you only have a small amount of time for gardening, grow those vegetables you eat that are expensive, like tomatoes. If you do grow tomatoes, barter some of them with a neighbour to get things like honey or eggs.

It's not easy saving money but it's very rewarding. When you have a successful month you'll take pride in a job well done. And it will bring you closer to your goal of living simply - all the things I've written about here are the practical day-to-day tasks of a simple life. So don't be scared of doing this, don't think it's too hard or that you really want those new shoes. Now is the time for action and if you can do this, if you can cut back and teach yourself to save, you'll put yourself and your family in a much better situation if the economic situation gets worse.

If you're doing something a bit unusual and it's helping you save, please tell us about it. There are many readers here who need help and a bit of encouragement, so if you can help with your suggestions, please do. We are all in this together.

And before I go ... happy Australia Day to all my fellow Australians. :- )

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