With Spring on the horizon, our minds are still overwhelmed by two questions:\u00a0What\u2019s going to happen with the COVID-19 pandemic, and what it will mean for the economy. Even if we consider ourselves to be financially secure, we have all been rethinking our spending habits and looking for ways to cut corners. Here is where budgeting become beneficial. When recessions come, no one is exempt. This is as good a time as ever to reevaluate our budgets and look to save as much as we can.<\/p>\n
Senior Personal Finance Correspondent for CNBC offers these four simple steps when it comes to budgeting.<\/p>\n
Step 1: Rank your expenses<\/strong> Put essential expenses you \u201cneed\u201d at the top \u2013 that\u2019s what you can\u2019t live without, such as housing, food, transportation and child care.\u00a0Then rank savings for emergencies and your retirement followed by \u201cwants,\u201d or nonessential items, which may include eating out, vacations or streaming services like\u00a0Netflix<\/a>.<\/p>\n Author, Nicole Dieker, suggests that you try budgeting for 30 days and then reevaluate on your findings. “Create a budget, cut your expenses and save every dollar you can for the next 30 days, then evaluate: Did you actually trim as much as you could\u2019ve? Did you make any purchases you regret? Were there any purchases you should have made but didn\u2019t? How did your budget affect your overall quality of life?” (You can read Nicole’s full article HERE<\/a>.)<\/p>\n Step 2: Challenge every expense<\/strong> She also suggests that it’s possible to negotiate betters rates on recurring expenses. I would also suggests hoping around and using your findings as leverage – utility costs, cable, internet, cell phones, and even credit card interest rates. Don’t forget to also allow us at Cypress Insurance Team<\/a> to shop your home and auto insurance to find you savings! I helped a realtor last week save over $4,000 a year on his auto and a few hundred on his home.<\/p>\n Step 3: Cut out a few \u201cwants\u201d<\/strong> Step 4: Go on a cash diet<\/strong> Finacial expert Ramit Smith recently stated in the New York Times that when we\u2019re making financial decisions in the face of so many unknowns, it\u2019s important to err on the side of cash. He recommends that if you have any plans for the rest of the year, like a wedding or a big trip, consider canceling them even if it incurs higher costs later. \u201cIn a time like this, particularly with increasing unemployment and increasing uncertainty, money in your pocket now is worth more than money in your pocket later.\u201d (You can read that full article HERE<\/a>.)<\/p>\n What are some other habits and principles that have worked for you? Comment below or email me at marketing@cypressinsuranceteam.com.<\/p>\n","protected":false},"excerpt":{"rendered":" Even if we consider ourselves to be financially secure, we have all been rethinking our spending habits and looking for ways to cut corners. Here is where budgeting become beneficial.<\/p>\n","protected":false},"author":1,"featured_media":358,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-314","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized","entry"],"_links":{"self":[{"href":"https:\/\/staging8.dynaserverx.com\/cypressinsuranceteam.com\/wp-json\/wp\/v2\/posts\/314","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/staging8.dynaserverx.com\/cypressinsuranceteam.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/staging8.dynaserverx.com\/cypressinsuranceteam.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/staging8.dynaserverx.com\/cypressinsuranceteam.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/staging8.dynaserverx.com\/cypressinsuranceteam.com\/wp-json\/wp\/v2\/comments?post=314"}],"version-history":[{"count":2,"href":"https:\/\/staging8.dynaserverx.com\/cypressinsuranceteam.com\/wp-json\/wp\/v2\/posts\/314\/revisions"}],"predecessor-version":[{"id":378,"href":"https:\/\/staging8.dynaserverx.com\/cypressinsuranceteam.com\/wp-json\/wp\/v2\/posts\/314\/revisions\/378"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/staging8.dynaserverx.com\/cypressinsuranceteam.com\/wp-json\/wp\/v2\/media\/358"}],"wp:attachment":[{"href":"https:\/\/staging8.dynaserverx.com\/cypressinsuranceteam.com\/wp-json\/wp\/v2\/media?parent=314"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/staging8.dynaserverx.com\/cypressinsuranceteam.com\/wp-json\/wp\/v2\/categories?post=314"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/staging8.dynaserverx.com\/cypressinsuranceteam.com\/wp-json\/wp\/v2\/tags?post=314"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
\nMost experts start by differentiating between discretionary and fixed expenses.\u00a0To do this, start by tracking what you spend money on and then rank that list of monthly, recurring and one-time expenses in order of importance.<\/p>\n
\nGo back over your list and challenge every outlay. Consider how much are you paying, as well as whether you could pay less or cut it out all together.\u00a0That includes whether you really use all the subscription services that you\u2019re paying for or that pricey gym membership. If you don\u2019t use it, lose it.<\/p>\n
\nOnce you\u2019ve streamlined the list, start cutting a few expenses that you just want and really don\u2019t need \u2014 at least temporarily.\u00a0That can include taking public transportation rather than an Uber or other ride-sharing services, \u00a0cooking at home and going cold turkey on eating out, or cutting back on your stops to your favorite coffee shop.\u00a0Start small. Be consistent. (My favorite coffee shop is L3 Craft Coffee<\/a> FYI! I would love to meet you there and chat!)<\/p>\n
\nCall it a cash diet and commit to these simple lifestyle changes that can help you save thousands of dollars over the course of the year.\u00a0For those who struggle to stick to a budget, switch to a debit card for the month.\u00a0Put your credit cards in a drawer and pledge to only spending the cash you have on hand for those few weeks.\u00a0If you have to put it on a credit card and won\u2019t be able to pay the bill in full next month, then you shouldn\u2019t buy it.<\/p>\n