Choppity chop chop the credit card. You'll be amazed at what you don't really "need" to buy when you know you won't have the cash for it or would prefer to use your cash for something else.
We follow a similar plan to astrolady. Works great. I can't remember the last time we got a bill.
I only ever use cash for everything, other than bills which are direct debited from my account each fortnight.
These are the things which are debiting from my account each week:
Car payment
Car insurance
Electricity
Gas
Rent
I pay my phone bill at the post office with cash, I always have cash in my purse to pay for everything else.
For grocery shopping, I write a list and meal plan. I use the calculator on my phone to keep track of how much I am spending while Im filling up the trolley, so I dont get embarassed when I go through the check out.
Come join the cash club! We've recently gone back to being a cash family! We;ve got a fairly relaxed budget. What we do is, each fortnight when I get paid, we divy up the money (online obviosuly). We send however much we need to keep aside for bills and we send it to the savings account thats not linked to a card.
When we work out the budget, we work out how much our bills will come to each fortnight. So we pay rent fortnightly, get a monthly Telstra bill (internet, phones, foxtel), a quarterly electricity bill, yearly rego etc, and we work out how much it all comes to fortnightly, and we send that much to savings so that when each bill comes either fortnightly, monthly, quarterly or yearly, we can just pull it straight from the savings without stress, knowing that the money is there. Just remember it has a place to go, and don't spend it in the meantime!
We then work out how much we want to leave ourselves for groceries and fortnightly incidentals, and we send the rest to a savings account as actual savings. next time we go to the shops we get out the cash, we only buy whats on the list and keep track of what everything costs, and if it's too much we put non-essentials back, and if we have some left over we might treat ourselves. We also keep some 'pocket money' for if we want to buy something for ourselves, or if we don't we just save it at the end of the fortnight (so we get out less next fortnight and put more into the savings account).
We don't leave anything in the account linked to the card so we can't overspend, but we do have the money in savings for emergencies (our fridge just died so we needed to buy a bar fridge in the meantime, so we bought it cheap at the boxing day sales from our savings). So at the supermarket, if it comes to too much we just put things back. We do take into account if its goig to be a big shop week, like if we need washing powder or dishwashing tablets or coffee or dog food, and add more to our weekly shopping budget, but we've worked out our average and with cash we make sure we aren't spending more than we need to on food.
It isn't hard once you're established.
(I shoulnd't lie. we do use our credit card for TTC costs, but cash for everything else...)
Last edited by Indadhanu; December 30th, 2010 at 06:49 PM.
With the CC, I had a huge debt on it and knew all the numbers off by heart - so I ordered a new card, and froze it into a block of ice and kept it in the back of the freezer. Meant I really had to make an effort if I wanted / needed it to use!!!!!!
As you use your CC for everything now, doing up a budget should be fairly easy in that you can see how much your bills have been for the last year. Do up a spreadsheet with the total spend of everything over the past year - that will tell you what you're currently spending. Now divide each item into how ever often you get paid - for me, it was 26 cause I get paid fortnightly. I then put that amount into an account separate from everything else, and set up all my bills to direct debit to that account only. Include your CC on that list and make the minimum payment on your budget - that will cover the interest and you won't increase the debt. It will allow you some breathing space if needed.
For groceries, read your local junk mail and stock up on basics when they are on special. My DH wanted to go and see how much money we could save on groceries. We just did a fortnightly shop at 3 stores - NQR (not quite right), Aldi & woolies. We bought around 75% of the stuff at NQR and it cost us $38 - it's good for basics and tinned / jarred stuff where short-dates don't mean much. Stuff like cream you can freeze. I did some more of the shop at Aldi but didn't find it had what I was after, which was weird, but I did get meat there a lot cheaper than Woolies. . And the balance at Woolies came to close on $120. All up our shop for the fortnight cost $200 instead of $270. Menu planning is key though, and cooking from scratch saves so much money - stir-through jars cost a lot, as do packet things like mexican meals. Don't be afraid to ask for a sub-total when shopping, and when you're at the big shops that have the subtotal displayed as it scans, put the expensive must-haves at the front of your shop for scanning and keep an eye on the scanner. That way you can adjust your other items and remove any luxuries if $$$ are tight.
I've found it very difficult to budget, and when I started I had a good friend come round every fortnight and help me plan for the fortnight ahead, she really taught me a lot.
I need to do this too Dan. DH is so anti it. He uses the card for work. But we only get reimbursed every few months. We never had a CC until he decided he needed one for work. Biggest mistake EVER! I want them gone. I have a plan. I have a budget. But I also have DH. Who can't follow a straight line painted in front of him let alone a financial plan or budget. Harsh? Yes... but if you saw our finances you'd agree!
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We also keep some 'pocket money' for if we want to buy something for ourselves, or if we don't we just save it at the end of the fortnight (so we get out less next fortnight and put more into the savings account).
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