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How to Put Your Family on a Financial Diet
We are talking finances today on the blog. Do you wish you had more money? Does it feel like you are living paycheck to paycheck? Let me tell you, I have been there and it’s no fun at all! You’re going to put your family on a financial diet!
Dieting is no fun. You deprive yourself of your favorite foods, you feel awful, and people often joke that to diet, you have to “die” a little, meaning you have to experience burden to make a difference. It doesn’t always have to be like that and it’s certainly not like that on a financial diet.
There’s good news though, you can actually create money by tweaking your budget. I’ve done it and I’ve helped others as well.
Want in? Check out this easy recipe for putting your family on a financial diet.
How to Get on a Financial Diet
Step 1.) Evaluate your finances
This is your starting point. Look at your monthly expenses for the month and write them down. Then, look at every purchase you made for the month. Yes, every purchase. You want to be thorough with this so don’t do it by memory. If you keep receipts, go through them all. If not, hit up your online banking and look at every single transaction. This can include purchases that you make once a year or buys that you do every now and then. Whatever the reason, write it down!
Step 2.) Make a list of essentials
Now, in that list of expenses and purchases, split up those items into 2 lists: essentials and non-essentials. Essentials are probably things like grocery, electric bill, water bill, mortgage, etc. Non-essentials might include Chinese takeout twice in the month, personal shopping, nail salon trip, etc. Once you’re done, head to step 3.
Step 3.) Eliminate 20% of non-essentials
This means, if you have 10 non-essential purchases, you will get rid of 2. Feeling bold? Aim for 40% instead. This can be tough at first but you’ll get used to it and you’ll love having extra money in your bank account in lieu of that hair appointment. Doing this will instantly earn you 20% (or 40%) of your purchase expenses back!
Step 4.) Reduce the payment for 50% of your essentials
This means you’re going to try to lower the cost of your essential expenses. Some examples:
- Cell phone payment: change your phone plan to save money or consider switching carriers
- Cable bill: call your carrier to take advantage of promos that lower your bill
- Grocery bill: use coupons, shop sales, use apps like Ibotta to get cash back
So, you’ll try to lower your bill on half of your essential expenses. Make sense?
Step 5.) Change your home habits
Changing your home habits means you’re going to tweak your behavior a bit to promote a financially savvy home life. This is easier than it sounds.
Think about some things you can do at home to make more room in your budget. Here are some ideas to get you started:
- Get a second job: Nothing makes room in your budget like adding to your income. Some examples: take overtime at your job, start driving for Uber or Lyft, deliver groceries on the weekend for Instacart, deliver for Amazon or Postmates, start a blog, do online transcription work at night when kids are sleeping, etc.
- Save on energy costs by unplugging appliances when not in use.
- Regift: That unwanted present you got can be gifted to someone else.
- Hold a garage sale: Take tally of unwanted goods around the house and sell them at a garage sale.
- Make a grocery list: Don’t EVER grocery shop on the go (or when you’re hungry) because you’ll end up spending way more than you need to.
- Repair holey clothes instead of buying new ones (sew a button, stitch a hole closed, etc.)
- Make meals at home: You can save so much by not eating out. Who doesn’t prefer a home cooked meal anyway?
- Turn in old, unwanted books at Bookscouter
- Drink more water: It’s good for you plus if you drink a glass of water before your meal, you’ll get full faster which means you eat less. If you eat less, you’ll have more food left over which will stretch further across the week. So, water=less food at meal time=more food across the week AND you might even drop a few pounds. Win-win!
Looking for some more frugal living ideas? Check out this huge list of 100 Great Tips to Save Money.
There you have it, 5 steps to financial freedom. Did you know it could be this easy? Following this financial diet will help you lead a more financially freeing lifestyle and get rid of that paycheck to paycheck lifestyle you might have been living. Got some tips of your own? Share with us down below in comments!
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