Most of the citizens in the developed and economically stable United States spend their monthly income all over and do not save money. According to a study by the Times, 76% of Americans live paycheck to paycheck. The reason for this is living on credit, which is especially developed in the United States. Young people take on loans for education, after starting a family, they take new loans for real estate, one or a few cars. Most could not help but have some fun with it by taking out loans for all things. As a result, an impressive amount of money is required for payment of existing loans.
General rules, methods, and principles of saving
The main rule of saving is to spend less than you can. As a follow up to this, you can put aside money on your major purchases, ensure financial stability and make sure that you can return it tomorrow. The methods of saving can be divided into:
- control of the level of income and expenses; 🔺
- scheduling regular and periodic purchasing; 🔺
- searching for alternative options when choosing products and services.
There are also a few principles of budget distribution that work for one person, as well as for the family. Let us consider a few of the most active and distributed.
- 50/20/30 principle. According to it, all the vitally necessary expenses must be spent on a half-monthly income. They include accommodation costs, utility services, food, transportation, necessary clothes, and household items. 20% of each salary should be debited to a savings account or sent to payable debts. 30% – this is the expense of food: entertainment, traveling, and optional purchases. The principle of 50/20/30 bits of help without delay, pay off the annual income and maintains self-propriety – you should spend almost all expenses on payment.The principle of 50/20/30 is not always possible to implement. Of course, if half of the money is spent on renting an apartment or paying a mortgage, it is impossible to impose such a principle. But it is worthy of striving for through the increase in income and lower levels of unreasonable costs. 💲
- The principle of several envelopes or piggy banks. It also suggests a planned budget dividing, but already for a larger number of parts. For example:
- 50-60% on current needs;
- 10% on major scheduled purchases;
- 10% on learning and development;
- 10% on entertainment;
- 10% on deposit
If you reduce the required costs, you can allocate more funds for expansion or development and deposit. Some include a list of obligatory health benefits, gifts, repairs, and welfare. Each part must be put in a separate envelope or piggy bank. Means that you have to sell or transfer to a low-level account in the bank to exclude determined spending and earn some interest. So that it was easier to control and adjust expenses, you could set the limit to not a month, but to a week. Such a planning option fits most people but does not take into account, for example, pay off the mortgage. If there is no proper housing, it is more profitable to accumulate a part and arrange a credit, in which it is necessary to allocate 30-50% of an average income. 💲
- The principle of distribution based on real products. For a few months, keep an eye on how much to spend, if necessary, use your expenses. Analyze the resulting numbers and, on their basis, have a clear budget. You can pay a gradual reduction in spending by 1-5% per month.
A simple principle is simply to bring to life because it requires less change in the habit and way of life.
Real advice on how to save a family budget 👉
- Make an accurate budget. Reduce expenses impossible without taking their concerns into account. Calculate how much you need to allocate money for each article of expenses and think about what you can cut or turn off. 👉
- Plan all the purchases. This will help to exclude impulse buying. You will have time to consider whether you need any of it and to consider alternative options. 👉
- Get the support of your family. If you will save, and other family members – no, the correct distribution of the total budget does not happen. Therefore, consider the plans for family functions. 👉 Avoid credit as much as possible. In the majority of cases, a loan is associated with an overpayment, which increases the total cost. You will pay and purchase a product that you cannot tolerate. Exceptions: buying a car, which significantly increases your income, or mortgage, payment for short lower rent. In this case, you save money by choosing a more profitable option and correctly invest money. The total saving is reasonable for each item of income. Let us look more closely at what and how to save
What to save a family budget on
Each person and family has expenses, which can be completely switched off, reduced and optimized. Among the compulsory costs are food, housing, health, and transport. Then goes purchase, which can be postponed. Those are clothes and shoes, household appliances and furniture, repairing and education and bad habits, fashionable and expensive gadgets, entertainment and travel are not necessarily to buy. It is possible to spend less not only on entertainment and leisure time but also on necessary goods and services without loss of their quality. You cannot exclude the necessary expenses entirely. Read how to save on them below.
On the nutrition
It is important that you do not save on the quality or quantity of food, but on its cost, in many respects, it depends on where you do shopping. Reviewing a diet in favor of good nutrition may also bring a positive result.
How to save on food right: 🍏
- Cook at home. Home food costs a lot, cheaper than semi-finished goods, ready-made meals in a canteen or a restaurant. For example, the price of a portion of salmon, in general, can be equal to the cost of kilograms of vegetables, and a standby weight of 200 grams is worth, like 500-600 grams of fresh meat. To save, have breakfast and supper at home, and take dinner with you. 🍏
- Plan the diet and purchase food for the entire week. A clear timeline of nutrition saves time on going to the supermarkets and money, makes the diet more balanced. 🍏
- Take a shopping list with you. So you will not get into trouble with marketing hooks and exclude unplanned purchases. 🍏
- Do shopping rationally. For example, sell-by-date goods are better to purchase in bulk. Keep in mind that packaged, washed or cut products cost more. So you can save on potatoes, carrots, caps, grits, sugar, flour. Easily spoiled items such as milk, curds – it is better to take in limited quantities so you will not have to get rid of rotten products. 🍏
- Buy at a discount. Fill out the bonus cards, pay attention to the stocks and sell-offs.
- On clothing and shoes
- Do not buy trendy items. They may go out of fashion right in the next season. Choose classic models that never get old, such as straight trousers and jeans, pencil skirts, knee-high socks, t-shirts, classic coats.
- Make sure that each item to go well with what you already have. So you can buy 6-10 things and use them to make tens of looks.
- Hand things over for repairs, but do not throw away. For clothes to serve for years and look good, use the correct cleaning, washing, and hand over for repairs on time.
On household appliances
Choose the one with a maximum warranty period – exclude unforeseen expenses for repair; 💿
with a minimal mark-up – in the online stores or large chain stores; 💿
on sell-off – at the time of seasonal discounts.
Buy functional devices you are sure to be using. For example, an expensive dish-washer or washing machine, there may be tens of operating modes, but usually, only 2-3 can be used. The iPhone costs 3 times more than usual smartphones, while calls, messages and social networks work the same way.
On daily use items
Things you might need once or a few times a year are better to rent in competence centers or at friends. Those can be maintenance tools, sports equipment, a travel case.
Travel tickets reduce the cost of each trip, while the flight or train tickets booked can cost 50% less. When it is warm, you can ride a bicycle at work if you have one.
Oftentimes, the most vivid emotions are not connected with the most expensive entertainment. You can go for a walk with children, friends or a dog in a park or research the surroundings of the city, organize games at home, an exercise in the open air, do yoga or swim can also be free of charge. If you want to use professional gym machines, choose a less popular sports club, where the gym membership will cost 30% cheaper, or pay during seasonal discounts.
To avoid spending extra money, follow these simple guidelines:
Plan and pay for the rest in advance – booking a ticket and the room, you are to pay less; 🔹
look for the best offer – the price of similar tours in different companies may be differed by 10-20%, but if you take a lot of rest, it is worthwhile; 🔹
make sure that you have a low-income plan and that you have a maximum amount of information that is suitable for living.
These and other simple ways to save a family budget will help to reduce costs by almost 30%, without limiting oneself.
What you should not save on
“My salary is too small to buy expensive things”, this principle works quite well. Tightening belts on everything can, as a result, lead to greater costs. For example: 🚫
a cheap pair of shoes can be torn off in a month and you will have to buy a new pair, and the shoes are 10-30% more expensive will serve 5 years; 🚫
ignoring problems with teeth or health will cause a serious problem and should be avoided, it is advisable to have a preventive check-up; 🚫
food of a reasonable quality causes problems with the gastrointestinal tract, metabolic disorder, and it is necessary to spend money on treatment.
Save on things wisely, choose quality goods at the lowest possible price.
About the author: Melisa Marzett is a freelance writer who was working as a journalist before and now is writing content for smart essay company and enjoying simple things such as cooking, handmade and sports.