Here’s a guest post from Sarah Scrafford. Sarah Scrafford is an industry critic, as well as a regular contributor on the subject of Small business. She invites your questions, comments and freelancing job inquiries at her email address.
The yawning chasm between the haves and the have-nots is not just because of the disparity in incomes – sometimes, it’s the attitude that one has toward money and spending that makes all the difference to being in or out of debt.
You don’t have to be a mathematician to figure out the numbers that make up your budget – all you need is to be able to list your income and your basic expenditure, set aside an amount for emergencies, do the addition and subtraction and put aside the rest in your savings account where it earns interest. In short, you need to be aware of the ABCs of sensible spending:
- Alcohol and tobacco are vices that are detrimental to your bank balance and your health.
- Budget, budget, budget – and follow it religiously.
- Cancel your credit cards and use cash whenever possible.
- Debt is a four-letter word that adds misery to your life – neither a borrower nor a lender be.
- Eat at home instead of spending at restaurants.
- Fat is not good – eat healthier and get enough exercise so you don’t spend a fortune on medical bills.
- Generic brands are as effective as and much cheaper than branded goods.
- Homemade is best – for gifts, cleaning solutions or clothes.
- Increase your income.
- Juggle more than one job.
- Keeping up with neighbors is an expensive and destructive habit.
- Lend money to no one.
- Maintain your assets and appliances in good condition to get the most out of them at the least cost.
- Non-perishable items are cost-effective when purchased in bulk.
- Outdo yourself each month: Spend less and save more.
- Pay more than the minimum balance on your credit card bills, and if possible the entire amount, each month to minimize the interest owed.
- Question every purchase again and again and buy only if absolutely necessary.
- Return things that you bought but have not used, or sell stuff that you do not need anymore in garage sales or online.
- Stop those shopping sprees.
- Teach your family the power of thrift.
- Understand your financial limits and accept them – it’s the key to being content with your life.
- Vacations need not be expensive – even a picnic with the entire family contributes to quality vacation time.
- Walk to work or car pool to save on gasoline expenditure.
- Xpect less, xtract more out of what you have, xtend your dollar to the last cent.
- Yachts and expensive playthings are for the idle rich, not for those on a low income.
- Zero-interest loans and credit cards are a godsend if you’re on a shoestring budget.