Save a Buck or TWO - Final Project (THANK YOU!!!!)

Victoria Richards- Booklet project –ProcessAudience: gainfully employed people.
How to save a buck or two
The majority of us do not have access to unlimited finances. When the unanticipated occurs, we often must juggle our money. An unexpected expense, such as a car repair, the replacement of an appliance or home improvement need, can send the average person into a financial black hole. Unplanned expenses may mean the need to use a credit card, or even worse skip one or more mortgage payments. Some people may ask relatives or friends for money, or borrow from a financial institution. A better solution is to plan for the unexpected and have a little, or large, nest egg. Saving money isn’t hard; however it requires commitment and discipline.

The first step to financial stability is to assess your situation. You have to establish where your money goes. For example, this morning you had $10.00. By the end of the day, you have $0.45 left, and no real incline where you spent the rest. To gain an idea of what you spend, keep a detailed record of EVERY expense. You must do this for several weeks. The record will help you identify where you spend money, how you spend it, and on what. You will see patterns of spending that help you with the next step.

Tip: Sample expenditure log (Graphic file)

Using your log, establish a budget. At the top of the budget page, note down your monthly income. Deduct from that sum your fixed monthly expenses: housing, utilities, cable, car payment, insurance and existing accounts (credit cards, loans). Next, write down the average sum of what you spent on necessities: food, cleaning and hygienic supplies, clothing and fuel. The last part of your budget is to note any discretionary expenses such as entertainment and leisure expenses.
NOTE: If your expenses equal more than your income-you have a serious financial problem, and you must immediately start cutting costs wherever possible.

Tip: Sample budget (Graphic file)

Assuming your income and expense balance are at equilibrium, this is where you identify where to cut costs to save money, and set short and long-term goals. Start small, and save what you can afford. Eliminate unnecessary expenses, but leave yourself some room to play. Most important, pay all your bills first and on time. Missing or late payments will affect your credit rating, and affect your ability to borrow money.

Where you can cut costs:
Stop smoking. A-pack-a-day habit costs $2,190 a year.
Limit your coffee. 1 cup daily Starbucks coffee costs $100.00 per month
No alcohol when eating out. 2 glasses of wine with dinner cost more than a bottle (4-6 glasses) retail.
Buy generic brands. Many generic brand items are equal in quality to name brand ones and usually retail for 10-25% less.
Use coupons, both for food items, and for retail stores. You can piggy bank the savings.
Evaluate your need, before making a credit card purchase. Pay cash whenever possible.

Stick to your budget. This is by far the most important step. Deviating from the budget, defeats the purpose of having one. Soon you’ll find yourself reading this book again from the start.

Credit card Knowledge: To pay off $8000 in debt making the minimum payment (approx. 2 %) on your bill would take 54 years, and cost you $31,000 in payments. Committing to a set payment of $160 a month (The first payment equals the 2% minimum payment) will pay off the debt in 8 years and would cost you $15,000. These calculations assume an 18% interest rate. Rates can be as high as 35% (http://www.debtsmart.com).

Periodically reassess your situation. For example, if your car needs repair, you will have to adjust your budget; or you paid the balance on a credit card and now have additional resources to add to your savings. Keep track of your progress. Continue to track your expenses and adjust your budget.

Try this, it’s easy.

Tear Out or Fold out: Blank budget, Blank expenditure log