Tag Archive | "tracking"

How To Determine If You Are Being Frugal Or Downright Cheap

As you and your family start to get serious about having a budget and about trying to keep expenses under control, there may come a time when you really need to figure out if you’re being frugal, or if you’re being downright cheap. Here’s a relatively simple way to figure that out.

While it’s true that those of us who are in the process of trying to get our finances under control will often focus on money, there’s also the issue of time. For example, does it really make sense to spend 2 hours clipping a grand total of $7 worth of coupons? Maybe, but probably not.

There’s no exact formula, and everyone will feel a little bit different about this, but you need to really try and measure whether or not the amount of time it takes to get something done is worthwhile relative to the amount of savings you hope to generate. Does that make sense?

Someone who is willing to drive around town for an extra 45 minutes because they want to save a few pennies on gas when they get more fuel is likely to be labeled by any occupants as being cheap. On the other hand, if you’re leaving the grocery store and you drive an extra two miles up the road to get your gas at a station that has a special sale, then you’re being frugal. In other words, you’re not engaging in extreme behavior that requires a lot of time and effort that ultimately only derives a relatively paltry amount of savings.

If you look at everything you and your family do through the prism of what others might be thinking, you might come to the conclusion that you’re being a bit too cheap at times. Nobody is going to like you if inconvenience others in a vein attempt to save a few pennies. That kind of behavior will universally result in you being described by anyone who comes into contact with you as being “cheap” behavior. Yes, it’s good to be frugal — but remember — being cheap typically means you’re not being wise with the use of your time.

Posted in Family Budget TipsComments (2)

How To Keep Track Of Family Spending Without Being Obnoxious

There’s a fine line between keeping track of the money that your family is spending and becoming an obnoxious jerk about it. You’re not going to be very popular in your family if you follow everyone around with a notebook and pen jotting down all of the expenditures that are being made. Not only will it seem very crass, bu it will really take a lot of fun out of things that should be enjoyable. There’s a better approach.

We know it’s important that we keep track of where the money is going. We can’t just spend recklessly and blindly without accounting for where funds are flowing. So how do we track expenditures without being obnoxious about it?

Think about how how many of us make purchases. We either use a check, or we use a credit card. While it’s true that we sometimes use cash, that cash often comes straight from a bank checking account or savings account. You’ll see how you can track the cash in a moment. But let’s initially turn our attention to credit cards and checks.

Do you literally have to be standing over someone’s shoulder looking to see who they’re writing a check to at the moment the check is being drafted? How about when someone is making a credit card purchase? Do you literally have to be right there monitoring what the money is being spent on? See, this is what would make people feel a bit uncomfortable. Doing things like this would be obnoxious — and they’re completely unnecessary.

You can easily audit checking accounts at the end of the month and even look at the checkbook to see where the checks were made out to — assuming accurate records are kept, which they usually are. Credit cards are laughably simple to monitor. Every purchase results in a line-item entry when you get your monthly statement.

This brings us to cash. How can you monitor that? While it’s not as easily monitored, you can at least get a general sense of how much cash has been spent based on ATM transaction notices that are listed on your banking statements.

By following this advice, you can accurately monitor expenditures without being obnoxious about it. It’s not as hard as it might initially seem!

Posted in Family Budget TipsComments (0)

Why Does Having A Budget Help A Family Make Financial Progress?

Families often wonder if having a budget will really help them make financial progress. Some even wonder how a budget is capable of making that possible in the first place. Let’s talk about why it’s so important for a family to have a budget. Once you understand this, it will become significantly easier to implement and maintain a budget for your and your family.

It is often said that we have a tendency, as people, to take more of an interest in those things that we track and monitor. Nothing is more important to your family finances than to track and monitor the amount of money that comes in every month as income, and how much money is spent every month. This provides a family with a crystal clear sense of where they’re at insofar as their financial stability.

Imagine for a moment how stressful it would be not to really know how much money you’re actually getting to keep at the end of every month after everything is counted. This is actually a reality for a lot of families. They generally know how much money they’re earning, but they do a terrible job of tracking where that money goes. They might have a vague notion of what they spend money on, but if you were to ask them to give you precise numbers, they’d be incapable of doing so.

Only by tracking and monitoring where you spend the money you have can you really begin to get a clear sense of what your monthly financial picture looks like. Don’t make the mistake of assuming that everything is fine just because you haven’t started getting phone calls from bill collectors.

Go ahead and take the time to start monitoring how much money you and your family earn, and how much you spend every month. Try to be as detailed as possible with regard to how the money is spent. Then, when you sit down to craft a budget, you can be realistic because you have a very clear understanding of where the money is already being spent.

Having this kind of knowledge will help your family make financial progress because you’ll be able to start allocating money for savings and investments as well as cut down on unnecessary expenditures.

Posted in Budgeting 101Comments (0)