Money-saving tips and strategies

It helps to know where all your money is going. Like Zerg said, keep good records of your income and your expenses.

I balance all of my accounts several times a week using accounting software that lets me see a quick summary of all of my month-to-date expenses broken down by category. I can also set budgets for the month, see how I'm meeting those budgets, and forecast my balances based on a moving average and scheduled transactions.

In short, I know a whole lot about my cash flow and it keeps me from running out.

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Originally Posted by Stop Sign

I'm just curious, which software do you use? I want to learn effective budgeting too, so I was thinking of using Excel to keep track of my expenses, but it sounds like the software you're using is more efficient.

You can do it with a spreadsheet, but you need to take some time to carefully plan your layout and equations for it to work well for you. One column per expense category and income category, and every row is a date. Separate columns and cells for tracking category totals, and set up charts to show weekly figures of what you are spending month-to-date and year-to-date.

A relational database-based solution would be mcuh more flexible, since you could cut and slice the data any way you wanted to.

The software I use is Mac-Specific (iBank from IGG Software). It has functionality similar to Quicken.

Of course, it isn't going to matter what software you use if you are not diligant about keeping records. The more information you feed the software, the better it will serve you. Depending on how many transactions you make, you may need to go over your finances once or twice a week. Some banks allow you to download a transaction history in .QIF format which you could then automatically import, but the amount of information included tends to be minimal, and the formatting sucks.

[quote=Alice]When you pay with cash, as opposed to a credit card or debit card, and you can actually see your little stash of money getting smaller with each purchase, trust me, you WILL spend less money than you do with plastic.[quote]

I stick with my debit card as the deduction is immediate, and there is no fee through my bank. Before I even walk out the door, I make sure I know how much of my balance is available for me to spend. This includes deducting any pending debits (Checks, Charges) which have yet to impact my account. I don't factor pending deposits at all, since they are of no use until they actually clear.

Using my debit card also makes tracking expenses by category easier. My Bank (PNC) records the location of the purchase, so I don't have to worry if I lose a receipt; I can deduce what the category was based on where the purchase was made.

Originally Posted by Alice

We have this whole sophisticated envelope system where, each payday, we stuff envelopes labeled "groceries," "gas," "haircuts," "clothing," etc. When we use all the money in the envelope, we don't spend any more in that category until the next pay period. Honestly, the first six months were the hardest, both psychologically and logistically, what with trying to figure out how much we really needed in each category.

Estimating a budget/category can be difficult for things you aren't explicitly billed for. I'm still gathering data before I can cut an accurate estimate of my monthly expenses per category. For example, I was budgeting about $100 ($25 per week) on gas. Looking back the past three months, I'm spending closer to $54 ($27 every two week) on gas.

I know one girl who is estimating that once she gets a car she'll spend $400 a month on Gas. I told her that was way overblowing that number, but she won't listen. At most, she'll likely spend $120 a month on gas.

There's nowhere I can't reach.

Originally Posted by orion_mk3

I don't know if they have them in other countries, but generic store brands are fantastic money-savers. For instance, the local generic brand sells macaroni and cheese for 10¢ less than the name brands.

This is a huge money saver that a lot of people miss when it comes to over-the-counter medications.

By Law, generic over-the-counter medications must have the same dosage of the same medication, and must have the same efficacy in the same time interval as their name-brand counterparts. The only difference is in the inactive ingredients used, otherwise the medications must be the same or it cannot be sold.

I've seen people insist on buying the expensive name-brand (Tylenol) instead of getting the generic Acetaminophen because even though they are both the exact same medication in the same dosage. Those extra dollars on the name-brands aren't going to better medicine, they are going to pay for the advertising campaigns that are all over TV and print. Hell, last year Astra-Zenica spent more money on marketing than they did on drug R&D and administrative overhead combined. That's why your name-brand Nexium costs $4 a pill.

This thing is sticky, and I don't like it. I don't appreciate it.