Top Ten Money Saving Tips

A friend recently asked me for my "Top Ten Money Saving Tips." My friend is a sahm (stay-at-home-mom) just like I am so my advice is geared towards our particular life situations. Here goes nothing.

1. Budget. Write down everything and decide ahead of time how much you want to spend. By everything I mean according to categories. Take for instance Food, Household/Toiletry Supplies, and Gifts (the 3 main areas we moms control).

2. Food: I've split my food into two envelopes or budget categories. Groceries and Eating Out. The idea being if I have grocery money left over at the end of the month I can use it to eat out (if Joel will go along with that idea). = ) The biggest way to succeed with food is to have a menu. I plan by the month. Then I shop for the entire month's non-perishable and meat ingredients in one trip. I have to go back every 7-10 days for milk and fruits/veggies but I find this system still saves me money. I figure the fewer times I'm in the store each month the less opportunity I have to spend money. For more of my thoughts on menu planning go here and check out Stephanie's Mommy Brain in the Kitchen (you'll want to scroll down passed the recipes).

3. Household/Toiletry Supplies. Again, BUDGET. Make a list of everything you will need to buy and how often. Then go once a month to buy those things. The key is to plan ahead and train your family members to write down for you BEFORE they are out of an item. (Let that teenage boy go without deodorant for a couple of weeks and I bet he won't forget to write it down again!) = ) Buy items like toilet paper and paper towels in bulk. I put haircuts in this category. To save money here I buzz Joel, Will & Ben's hair. That's $15 * 3 every 6-8 weeks that stays in my pocket. = )

4. Gifts. BUDGET. I know I sound like a broken record but it is the key to controlling your money rather than your money controlling you. I just did our 2008 budget and itemized this category. Last year I didn't itemize and a few gifts caused me to be "creative" with my budget to pay for them. By itemize I mean write down every single gift you will need to give this year and how much you want to spend on it. Now add up the grand total. Can you live with that amount or is it a little on the ridiculous side. You may want to consider taking some people off your list. If you just can't take a person off, can you spend less on their gift. Take for example children's birthday presents. You may have a perceived social obligation to give a gift. Does it really have to be a "nice" one or will a small gift bag from the Dollar Store be sufficient? (J.-I'm not thinking of E. on that one but a couple of other kids on our list.) = ) Also consider if you and your husband really need Valentine's, Birthday, Mother's/Father's Day, Christmas gifts. Right there is a small fortune. Consider alternative ways to celebrate these events.

5. Electricity. As SAHMs we are home a lot of the time. At least I am. I try to keep the lights off as much as possible. Part of this goes back to my Dad charging me a dime if he found my bedroom light on and me not in the room. I've trained myself to turn the light off when I leave a room. Those half cents add up to pennies and pennies to quarters which can buy you a soda pop at Walmart! I'm not advocating living in the dark. I'm saying if the sun is shining, why is the light on? The same goes with the TV and the stereo/radio. If no one is in the room, why is it on?

6. Heat/Air Conditioning. I rarely set my heat above 68*. Lately I've been trying to keep it as close to 65* as possible. Put on sweaters or a fleece jacket. Wear slippers or shoes. Tell your kids to do the same. You'll be amazed how much money you save. At night our heat goes down to 62-64* (depending on which of us sets it). And no, your children will not freeze. My guys wear fleece pajamas and sleep under flannel sheets and a light blanket. And my house has terrible insulation. Only recently have I checked them at night and not found them sweating. For air conditioning I wait as long as possible to turn it on. For heat and air my rule of thumb is to allow myself to be slightly uncomfortable. Once you start turning things down/up you'll be surprised at your new level of comfortable.

7. Determine what is a need, convenience and luxury for you. For example, we have been using only one vehicle since Thanksgiving (the reasons are a whole other post). Joel's office is about 15 minutes from our home. I have no commitments outside my home but on days I want the van (for a play date or doctor's appointment) I can take him to work and pick him up with only slight inconveniences. So we are finding that a second vehicle is really a convenience for us, not a necessity. Also, decide what conveniences are worth paying the money for. For example, I can buy a 5 pound bag of baby carrots for $4.99 or a 1 pound bag of regular carrots for $0.79. To me it is worth the extra $0.20 a pound to not have to peel the carrots. You may not think so.

8. Consider giving up foods that have little to no nutritional value. Soda pop. Chips. Cookies. Juice. You get the idea. These items consume a lot of money and give your body nothing. If your family will protest to0 much at their sudden disappearance then start weaning them off. Buy less and less each month until they've reached "Treat" status rather than "Hafta have" status.

9. Family Activities. Free activities are everywhere and I'm not just talking about going to the local park, though that is a good one. Check into what the local library offers. I can obtain a free or discounted pass to about a dozen different museums, zoo, etc. through my local library. Also, visit the website for the museum you are interested in touring. MOST in our area have free admission once a month or even once a week during off-peak hours. These free times are usually funded by company sponsors and may not be heavily advertised.

10. Write down your short term financial goals for this year and a few long term goals. If you keep these goals in mind then you put your "sacrifices" and inconveniences into perspective. Our goals for 2008 are to 1. finish funding a ira/mutual fund retirement account (we committed to investing a set amount so we could get a lower fee), 2. build up 3 to 6 month emergency savings in a mutual fund money market account. Longterm goals include paying off our mortgage asap and increasing our retirement savings.

I know all of this stuff seems like a few pennies here, a couple of dollars there, but it all adds up in a hurry. Slow and steady wins the race. Before you know it you'll have accomplished your goals and you won't even remember that dinner out you "sacrificed."

***Edited to add. If you are my friend that prompted this post, I expect to be rewarded with a comment. = ) Go ahead. You can do it. = )