January is the time of year that many people think about budgeting after the economic excesses of the Christmas season. Rob and I were looking at our bank statement and realized we were spending a lot more than we were earning. He thought maybe someone was siphening money out of our account. However, it was just a case of us being unaware of our spending habits. We didn't go out and make a huge purchase; it was simply "death by a thousand cuts" as Rob explained. Well, just as we spent ourselves into debt little by little, the way to get ourselves out of the hole is to cut back little by little. Here are some tips I found on the Internet to pinch pennies, a term first coined in 1942 when World War II was forcing everyone to cut back.
1. Cancel newspaper or magazine subscriptions.
2. Find the cheapest gas in town. However, don't drive so far that you burn up too much gas getting there.
3. Cut back on your heating by turning down the thermostat. Turn it up in the summer to cut back on air conditioning.
4. Purchase inexpensive foods at the grocery store that go a long way ex. spaghetti.
5. Purchase a water filter and drink tap water. You will save a lot on bottles.
6. Brew your own coffee.
7. Pack your own lunch.
8. Stock up on sale items at the grocery store, especially non-perishables like canned goods, rice, etc.
9. Avoid fast, processed or convenience foods.
10. Choose generic brands if the taste is comparable.
11. Shut off the lights.
12. Switch your life/home/car insurance to a cheaper provider.
13. Save at least 10% of your income.
14. Cook rather than eating out. I was watching "Till Debt Do Us Part" one day. The show featured a young couple who spent, on average, $1330 a month on restaurants!
15. Pay your bills online to save on stamps/gas. I have yet to follow this tip.
16. Send an e-mail rather than calling long distance.
17. Use homemade cleaning products rather than store-bought ones.
18. Check your toilets for water leaks. My Mom noticed her water bill inching up each month and wondered why. She checked her four toilets and discovered at least one leaking.
19. Shop at a discount grocery store like Food Basics, Price Choppers. However, it's not just where you shop, but how you shop. Rob and I switched supermarkets for a few months and noticed our bills dropped for several weeks but then they started inching up.
20. Take a spending break for a day. Suze Orman recommends this tip.
21. Get a library card. Books are more expensive than ever before, especially in Canada.
22. Shop around for a better mortgage rate. When Rob and I first got our mortgage, the country was still recovering from a recession and rates were high. Within five years, interest rates dropped considerably and we were able to blend our mortgage rate (they blended our rate with the current rate and met somewhere in the middle). In the meantime rates dropped even further and we switched to another bank which paid our penalty for switching mortgage holders.
Here are some recommended books to read on pinching pennies:
1. 1001 Ways to Cut Your Expenses (Jonathan D. Pond)
2. The Tightwad Gazette (Amy Dacyczyn)
3. A Day Without Spending, a Lifetime's Worth of Lessons (Suze Orman)
Photo courtesy www.theepochtimes.com.