A rapid decline in living standards due to income loss can be precipitated by events such as domestic violence. One way to reduce the impact is to budget. Budgeting can be an easy exercise that saves money and maintains living standards. Simple strategies such as taking out a car loan rather than spending a lump sum to buy a car, can improve the budget bottom line.
Some easy ways to reduce spending are:
- Write a budget and stick to it
- Comparison shop
- Eat at home
- Loan rather than purchase
1. Write a budget
When income is suddenly reduced due to unemployment or domestic violence, it is essential to reassess spending habits. Writing a budget can help in this process. Dividing expenses into wants versus needs can provide a guideline for spending cuts. Food, utility and medical bills, which are needs, should be prioritised over eating out and buying luxury items.
2. Comparison shop
Food and utility bills are needs. However, they can be drastically reduced by comparison shopping. The simple act of picking up supermarket catalogues can save a great deal of money. Shopping for items that are on special improves value for money and saves on the food budget.
Utility bills can also be reduced by comparison shopping. Many companies will offer discounts if you sign a long term contract. Internet companies will offer special deals if you haggle. Some companies will offer discounts for on line purchases as opposed to in store purchases. Others will reduce payments if a customer gets bills on line. Research and patience can lead to a great deal of saving on utility bills.
3. Eat at Home
Many people spend a great deal of money eating out. This can apply to working people who buy lunch every day, or people who go to fast food restaurants for dinner. Eating out is expensive. It is cheaper to make lunch at home and take it to work or school. Nutritious meals are not only healthy but inexpensive.
Eating out at restaurants is also an expensive habit. Cooking at home can result in tastier meals and better eating facilities. It is also a cheaper alternative. In addition, suggesting that friends come over to dinner can create social opportunities. Later they can return the favour. This is an exciting way to combine socialising with budgeting.
4. Loan or Borrow Items
Instead of buying items outright take out a small loan. The price of the loan can be factored into the budget. For example, a car loan at a reasonable rate will provide a service and help with monthly budgeting.
Borrowing items is another alternative. For example, instead of buying books, loan them from the local library. Instead of buying DVDs borrow from the local DVD shop. These simple steps can lead to saving money and keeping to budget.
Budgeting is an easy exercise when common sense is combined with targeted spending. Distinguishing between wants and needs is essential to a good budget. Saving money through comparison shopping, borrowing items or eating at home can all contribute towards a rewarding lifestyle at a reasonable price.