April is financial literacy month and you have probably seen many articles about improving your financial literacy. All of the information is helpful and useful, unless you are just broke. You may be one of the most frugal people you know. You gave up designer coffee years ago, always use coupons, only buy things when they are on sale and rarely go out to eat. Yet, there is still no money left for saving. Knowing that you know what to do with your money is one thing, but having the money to save is another thing altogether. Your frustration may be so great that you don’t like to look at your finances and are in a state of feeling frozen.
The best thing you can do in this situation is to find a way to make progress, however small it may be. Even $25 per month could make a big difference. Once you start moving forward again, you will feel more secure and empowered to make more financial gains.
But how do you do that? The answer is to set a goal to “find” a small amount, fixed amount of money that can be saved each month. Here are some steps to take and some ideas for finding that money:
Don’t assume that your fixed expenses are permanently fixed
Fixed expenses are your bills that are the same amount each month. They are your rent or mortgage, insurance, installment loans of any type and some utilities like cable, phone, etc.
Sometimes, the easiest place to “find” money to save is in your fixed expenses. It may take a little of your time but make some phone calls. Find out if you can reduce any of these expenses by refinancing, changing services, consolidating, moving and/or downsizing or reducing the use of them.
Ask for a raise
If you receive an annual review and you typically get a standard annual increase without question, why not negotiate for more? Have you ever even asked? Have you told your employer lately why you are a valuable employee?
Check your automatic payments
Are you paying for anything automatically through your checking account or on a credit card on a monthly basis that you don’t really need? Once automatic payments are set up, people often forget about them.
Earn extra money for something you like to do
We aren’t talking about taking on another job or huge project that will make you feel overworked. We are talking about using a skill or talent you already have to earn a few extra dollars each month. Focus on something that might bring you a fixed amount of income each month and will not cost you money to get started.
Cut your gift-buying budget
Americans spend a lot of money on gifts. Even if you believe you are the best shopper you can probably cut your gift-buying budget. Here’s a recommendation: decide to cut that budget now by at least $25 per month or $300 per year. Just do it. Then, spend some time thinking about how you can replace those gifts that once cost you $300 per year with something more meaningful and less expensive or free. Thinking ahead for those birthdays and holiday gifts now will make it easy to make the cut. This can actually turn into a fun and rewarding weekend activity. Write some poetry or a journal for someone, find something old and already paid for and turn it into something new, or decide that you are going to “do” something for someone instead of a buying a gift. Go through your list of people you buy gifts for each year. Always remember: you are not obligated to buy gifts for everyone!
If you are like most Americans, $300 is less than you spend on gifts each year. It may even be a lot less than you typically spend. You can still leave some money in your budget for some gifts. If you are a person who actually saves the cash all year for gifts, then this idea will immediately give you money to save. If you use credit cards, you may still be paying for the last holiday and can’t put that money aside yet.
Spend time looking for more new ideas
There are so many great resources to find new ideas for increasing your income or decreasing your expenses. Spend some time looking for them. Choose the things to do that make it easy for you to save even a few dollars. Set aside just an hour or two each month to look for the ideas.
Once you start making your forward moves, you will want to find more ways to find a few dollars to save. Then, once you have some money saved, you can put your financial literacy knowledge to work for you so that money earns money for you. All you need to do is start.
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