Friday, February 27, 2009

Does $25 Really Make A Difference

I was discussing with my lovely housemate the other day about getting rid of cable for the summer. He works a lot because its his busy time and I plan on being too busy for my own good. After talking about how much cable actually costs, it would only save about $25 for each of us. So then we started asking ourselves if that was even worth the savings. In the end we decided it wasn't.

Please, keep in mind that we have not been hugely effected by the recession. We both have our jobs and the hours and pay have remained the same as it was pre-recession. The things we have noticed that are effecting us is how expensive groceries are and the prices at our favorites restaurants have gone up a little. Even most of our friends still have their jobs and aren't largely effected by the recession. To us, convenience is still worth the extra $25 a month.

Don't get me wrong, even though we haven't really been effected, my budget is still be squeezed for every last penny I can find. The reason; financial goals and student loan debt. My housemate is also trying to cut back in order to try and save more.
I have to pose the questions:
"How do you manage your budget in a recession?"
"What amount is too much?"
"How do I control my habit to shop?"
Let's start with the second question just for humor. When it comes to cable TV, the extra $25 a month for it is worth it. When it comes to pants, $25 more is a ton of extra money. No way will I buy those! But if they cost a total of $25, that's a steal. $25 to fill my gas tank is a little on the spendy side but $25 for a week worth of healthy groceries is amazing. It all depends on what you are buying and how long it will be around.

The third question is difficult. In fact, right now I don't have an answer because this is something I am struggling with tremendously. Great example: Online shopping, if I look at clothes online, I have more desire to go to the store and buy it. Temptation is ridiculous. When I was younger, I was never able to go shopping unless school was starting soon. Could this be what fuels my weakness?? Who knows. But I do know that I have a few keys things to save when I do shop; Although I look online, I don't buy online (very often), I go to the clearance racks first and try things on, then browse the store (most of the time). This way I can see what will be on sale in the future. If I really don't want to spend money, I try to bring my housemate with me(rarely does he want to go). He always keeps me from spending money-because he never buys anything at the mall. EVER.

The first question; the whopper question. Honestly, the only way to effectively manage your budget is to track it, establish your limits on spending, auto-deduct part of your paycheck to your savings and stick to it! Its hard to follow a budget if you don't have one. So get one. Every month check your figures and make sure they are accurate. Excel is amazing, learn to love it.

In all honesty, you should pay me $25 for this advise. After all, it will make a difference in your life long-term. *wink wink*

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