LOUISE FAIRSAVE: Beat the cost of living
Are we serious about beating the high cost of living?
These are areas for us to consider. First, the obvious step is to spend less. Yet, this is easier said than done.
Here is a proposed routine: start by thinking carefully if the purchase is a need or a “want”; try to avoid the purchase, using every excuse to do without it. If all else fails, become a bargain hunter.
Most of all, avoid impulse buying. This is how a tidy sum can be frittered away thoughtlessly.
One way to build motivation against senseless spending is to keep a running note of how every cent is spent for at least a three-month period. If you have never tried this before, I challenge you to try this illuminating process.
You’ll likely be shocked on how you are spending your money compared to how you think that you are spending it. In any event, you will have clear evidence to support your either keeping, or more likely getting your spending on a rational track.
This brings us neatly around to the many benefits of pre-planning one’s spending, and one’s earning, by maintaining an explicit personal budget. One of the most powerful tools for managing your money is preparing, maintaining and following a detailed budget of earnings and spending.
You may be an organized person who already keeps a budget. If so, this is a good time for you to reconsider the luxuries and “wants” that have been included for this year. These items may be cut out completely or just postponed to another year that bears less risks related to the high cost of living.
Pointedly, you must also consider your earnings. Keeping and expanding your earnings is a critical cost of living weapon. So the first thing is to keep one’s job. Do it well and conscientiously so there is no likelihood of termination through one’s own fault.
Yet, the business or industry may collapse or downsize and throw one on the breadline. Hopefully, there will be enough slack in one’s budgeting to allow a reasonable time to find another position.
One must also consider how to earn more – maybe a raise, another source of income from say, a second job or by exploiting a skill or talent for pay.
How can you save time that can be put towards earning more or towards avoiding typical expenses?
Is there land space for starting a herb or vegetable garden? Or is your strength in growing decorative plants and flowers?
If you must buy, attempt to acquire assets that will appreciate or sustain in value – so, avoid buying a brand new car, and it makes more sense to buy one piece of gold jewellery than three pieces of costume jewelry.
Is there opportunity for bulk purchases in your extended family, residential area, church group or other grouping?
What are the opportunities for free or lower costs recreation: picnics in the public parks; bus rides; group potluck meals; or group DVD showings? Are they opportunities for carpooling?
In summary, if we are truly committed to beating the cost of living, there are many opportunities for us to help ourselves and our “neighbours” with income and expenses.
Louise Fairsave is a personal financial management advisor, providing practical guidance on money and estate matters. Her advice is general in nature; readers should seek other counselling about their specific circumstances.