Bookmark and Share

Are Your Spending Habits Painful?

If the current economy is forcing you to take a closer look at your finances, you may be surprised at how much extra money you are spending each month on items that could otherwise be earning you money. Many people have an unhealthy set of spending habits that could be causing unnecessary stress. There are several ways to reduce your spending, without giving up the things you enjoy. Here are some personal finance tips that can help to build your credit union savings account, instead of draining it each month:

Making a Budget
One of the easiest ways to get your finances organized is with a budget. It is easier to make a monthly budget as opposed to weekly because it will give you a better overview of how much you are really spending as well as how much you can save each month. In your budget, include all of your household expenses such as mortgage or rent, utilities, and groceries. You will also need to include what you spend each month for transportation, including car payment, insurance, gas, and repairs.
The next thing you will include in the budget can get a little tricky because it includes all of your extra spending such as buying lunches, stopping at the local coffee shop, trips to the vending machine and impulse buys. If you aren’t sure how much to include for the extra spending, keep track of what you spend each day for one week and multiply this times four to get an average amount.

Open a Savings Account
Although creating a budget is very important, opening a savings account is equally as important. For the most lucrative interest rates, you should have a credit union savings account instead of a traditional bank. Credit unions such as the CDC Federal Credit Union typically have a higher interest return and offer several different account options. This is important because you will soon be making deposits with the money you are saving, which means you will be earning money from CDC FCU on money you would have otherwise spent unwisely. To help get you started with an initial deposit, consider putting one dollar each day into a jar, at the end of the month you will have $30 extra dollars that can be used for an interest bearing savings account.

Eating Out
One of the quickest ways to waste money is by going out to eat more than often you can budget. Not that you shouldn’t enjoy a nice meal out occasionally, but buying lunches or stopping at a drive thru on the way home can cost a fortune. The average person spends $5 each day eating lunch out, that is $100 each month that could be in the credit union and making you money. Instead of buying, pack your lunch each day. Eliminating one dinner out can save you an extra $50 each month. Bring coffee or tea to work with you and save an additional $2 each day or $60 a month. By watching how you spend money on eating out you could potentially save about $210, which could be earning interest through your CDC Federal Credit Union account.

Miscellaneous Savings
Transportation is expensive, so consider taking public transportation once or twice each week to save about $50 or more on gas. To save even more money and get in shape at the same time, ride a bicycle or walk whenever possible. Reduce utility bills by turning off lights, unplugging electronics when not in use and talk to your local energy resources company about other ways to cut your utility costs. By using energy conservatively and using alternative means of transportation, it is possible to save an additional $200-$300 each month.

At the end of each day, put the money you would’ve have typically spent in your savings jar. For example, if you usually go to the vending machine twice a day and spend $2 each time, put this money in your jar. Do this for each thing you save money on, if you use a coupon and save .30, put it in your jar. At the end of the month take everything in your jar and deposit it into your CDC FCU savings account. It will not take long before you begin to notice how large your savings account is getting.

 

Want more articles like this? Subscribe to Dollars & Sense

Was this information helpful?
Please rate the content from 1 to 5. A low score means the content was not helpful. A high score means the content was very helpful.
Current rating: 4.5 (2 ratings)