Question:   What money saving techniques can I use to ensure I don’t spend more than I earn. What’s the secret?

Answer:      The most effective money saving advice I can give you is not either mysterious or secretive. The best techniques are simple to use and easy to implement.

Planning and forethought is essential to making the process of saving money a life-long habit. If you will invest some time and effort upfront you can stop spending more than you earn, pay down your debt and see your savings begin to grow.

One way to monitor your spending is to plan your purchases on paper prior to actually spending any real money. Create a budget that you can manage and consistently follow.

Be specific and thorough in your allocation of dollars, while still allowing for emergencies and a little fun. Make sure you have your priorities in order and write down everything you plan to spend.

Total up all your planned expenditures and ensure they don’t exceed your earnings for the same time period. If you find that your planned expenses are exceeding your income, make cuts accordingly beginning with your lowest priorities.

Spend only according to your plan and put any remaining funds into savings or against your debt.

Money saving techniques like this will help you to adopt smart habits by making you think carefully about your spending. It prevents you from making rash decisions or forgetting an important bill. Thoughtful planning will keep you from making poor money decisions.

Another one of the tried and true money saving techniques is the envelope system. You’ll use a set of envelopes and a budget in cash for this planned spending system. Once you’ve planned your budget, place cash in envelopes labeled for each of your major budget categories.

For example, you might have envelopes for groceries, rent, gas, entertainment and emergencies. Once the cash in a particular envelope is gone, you don’t allow yourself to spend any more money in that category until the next pay period.

Once again, planning ahead of time saves you from making painful financial mistakes. By using cash only, the envelope system lets you see your dwindling cash as you use it for expenses. For many, actually seeing the cash can be a powerful motivator to not spend the money.

Keep your purchase receipts in the envelopes so you can continue to track your expenses as you fine-tune your budget from month to month.

These old-fashioned money saving techniques may seem quaint or dated, but they work as well today as they have for the past 100+ years. If you put them to use you’ll learn to spend thoughtfully and save wisely.

» Should I use the envelope system to manage my money? What exactly is it and how does it work?
In a world where we are asked multiple time per day, “Will that be credit or debit?” it’s hard to imagine using a method as simple as the cash-based system to manage your money.

» I need to learn how to manage money; what is the best way to get started?
You need to have a clear and honest picture of all funds coming in and going out. Only then can you begin to create a workable budget for yourself.

» I have irregular income so how can I create a budget if I don’t know how much I’ll have to spend each month?
How to budget irregular income. Discover how to successfully imlement a household budget when your income varies from one month to the next.

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