Sticking to Your Grocery Budget

One of the first lessons that I learned when I began couponing is that it is easy to get caught up in the savings and buy things you don't really need.  It is even easier, and more justifiable, to go over your grocery budget to get great deals on items you will use, but don't need right away. 

In order to avoid making these mistakes, you have to realize and appreciate the value of having and sticking to a good grocery budget.

Importance of a Grocery Budget

1. Gives you accountability.  It is easy to say that you saved $x.xx amount on groceries, but you gain control of your finances when you are able to stay within a predetermined amount.

2.  Keeps you in check.  While stockpiling is a big part of saving money on groceries, a budget helps prevent excessive stockpiling.  Be sure to pay attention to expiration dates when stockpiling.  If you can't use it before it expires, maybe there is another item that budget money should be used for.  If it fits in your budget, there is always the option of donating excess items to a local food bank. 

3.  Helps prioritize your purchases.  Because of my grocery budget, I am much more careful with my purchases.  I am much less tempted to splurge on a great deal on non-necessary items. 
 
Tips on Sticking with Your Budget 

Don't Stress Over Missed Deals.
There are far too many great deals and freebies to be able to get them all without spreading yourself too thin.  I try to plan all my deals into one or two shopping trips a week.  I try not to stress over not getting every freebie or the best deal on everything.  Instead I focus on meeting our families needs and staying within our budget. 

Avoid Spending Money on Coupons
When possible, I get copies of the Sunday paper from friends and family that do not use the coupons.  I do buy the Sunday paper when I like the coupon inserts and I can't get them from another source.  I first check the Sunday Coupon Preview to see if I will use the coupons.  I do miss some deals by not getting every insert, but I have learned not to stress over missing one or two deals. 

Where Do I Get the Coupons I Use?
I use the coupons I get from the Sunday paper, products I buy, catalinas, free mailers, free samples, and printable coupons.  For example, right now you can sign up for a free coupon booklet from Home Made Simple, a free subscription to Rouge Magazine which contains high value coupons, and you can print coupons for free from Coupons.com, Redplum, SmartSource, and sometimes the product manufacturer's website.

I posted a few of our grocery budget goals for 2011 earlier this week.  If you have not already, I encourage you to make a realistic grocery budget and stick to it.  If you have a grocery budget, maybe you could challenge yourself with a smaller amount.  If you are having a hard time sticking with your grocery budget, review your spending habits to see if you need to cut back on purchases or if your budget amount should increase to meet your needs.

What helps you to stick with your grocery budget?

Keep Track of Your Budget in The New Year

Did your goals for this year include keeping better track of your budget or setting savings goals?  Mine sure did!

One way you can set up a budget is through Mint.com.  Mint is a FREE online budgeting program that can help you set up a budget and stick to it.  With Mint you can monitor all of your bank accounts in one place, set up a budget, and set savings goals.

If you are looking for a new budgeting method this year, be sure to read my review of Mint.com.  One of my favorite parts is that it is free, so you can try it and decide if it helps you or not without paying for a program.

Daniel and I have our budget set up on Mint.  I get emails if I go over my budget in a category, which reminds me to keep on track.  We also have our savings goals set up on Mint and linked to our ING accounts.  This gives us a visual on how we are doing on reaching our goals.

How Do You Prepare for the Unexpected?

On the movie Remember the Titans a football team is challenged with looking beyond racial and social expectations.  At one point Gary tells his friend Ray something to the effect of:

When something unexpected is thrown your way, you just got to take it and run with it.

There are so many unknowns in life.  When it comes to budgeting, planning for those unexpected things is both difficult and essential.  You may not have major car maintenance every month, but an unexpected problem could put serious strain on a tight budget.

How to Prepare
I definitely am far from knowing all the answers. Our life seems to be made up of unexpected twists and turns in expenses & income.  Sometimes I feel like it is impossible to plan for anything because there are so many unknowns.  But, in the end, having a plan- however broad it may be- allows us to stay on track when unexpected events are thrown our way.

Here are three things that we have done to prepare for the unexpected:

First- Create an Emergency Fund. To start off, try to save1-3 months of living expenses.  If you have an unexpected loss of income, this can stand as a buffer and ensure that your necessities are taken care of.

Second- Set aside savings for known expenses.  This may sound basic, but it is also easy to forget. 
 
For example: Daniel and I traveled to California for Thanksgiving.  Prior to our trip, we had set aside $300 to pay for our gas and travel expenses. Because we had the money set aside, we did not have to take that extra $300 out of our income for that month.  We also knew in advance that we would be able to afford the trip. 
 
Saving small amounts each month towards future expenses allows you to see what you realistically can and cannot afford.
 
Third-Save for possible big expenses.  On top of saving for expenses you know will come, be sure to save for possible unknowns. 
 
For example: Daniel and I have a small Auto Fund to pay for car maintenance- both expected and unexpected.  This may not cover all auto expense that will come our way, but it would serve as a good buffer in case of an unexpected expense.  We also have an account for medical expenses with the same idea in mind.  These are two areas that can easily bust a budget if not prepared for.  
 
By having an emergency fund, preparing for known and possible unknown expenses, we have been able to avoid financial stress and hardships.  Though our income is far from regular, we have been able to prepare.  At this stage of our life, that is as close to financial peace as we are going to get.

Mint.com- A Free Online Budget Program

I have heard a lot of good things about Mint.com, but I did not want to post about it until I had tried it out myself.  Call me a nerd, but I really enjoy budgeting.  I like to see exactly where we are spending our money, because it allows me to see where we can cut back and spend more wisely. 

Daniel and I use a free version of Quickbooks for our accounting.  We like the wide range of data and reports we are able to generate for us and our accountant, so we will continue using that for our records and accounting.  However, there are a few features on Mint.com that I plan to use to help us monitor and stick to our budget and savings goals.

About Mint.com
Mint.com is a free online money management program.  When you sign up, you are able to link all of your bank accounts and credit cards to your Mint.com account.  This helps you to categorize your purchases & create a budget. If you choose, you can receive a weekly email with a summary of your spending.  You will also be notified via email if you over spent in any of your budget categories.

Tracking Our Budget
Daniel and I are great at writing a budget.  We are pretty good at sticking to the budget.  Our problem is that there are a lot of little things that we don't always put in the budget.  Little things like gifts, clothes, and eating out are not categories that we spend in every month, so we have a harder time keeping track of that spending. 

This is where I got really excited about Mint.com.  I have set up our budget with all of our spending categories.  I can now log on to my Mint.com account and see exactly how much I have spent in each category to date.  I don't have to input the receipts or reconcile my accounts.  It is linked to my accounts so that I can see how I am doing automatically.

Daniel and I are really trying to minimize spending and maximize saving for Vet school.  We set pretty tough goals, so it really helps to quickly see if we are spending too much.

Setting Savings Goals
Mint also has a tab that allows you to set savings goals.  Daniel and I have set up separate ING accounts for each of our big savings goals.  We were able to link each account to a goal and Mint will help us track our progress.  This helps us to see how much we need to earn each month in order to reach our savings goals.

Cons to Mint.com
One downside to Mint.com is I cannot customize the transactions or create reports from my account.  Mint.com is a money management tool, a budgeting tool, and a savings plan tool.  It is not made to replace a more detailed accounting software.

Summary
If you are struggling with setting up a budget or want help keeping track or sticking to your budget, I recommend that you give Mint.com a try.  It is free- so if you don't like it you can delete your account.  I am excited to continue using Mint to track our daily spending and how we are coming on our savings goals.

Have any of you tried Mint.com?

Budgeting- Give Back

Give Back.
While it is important to know where every dollar you earn is going, it is even more important to learn to let it go.  Don't get so caught up in saving your pennies that you forget to help those around you.  Give to your church, give to a charity, take dinner to a neighbor in need, etc.  One of the most empowering things about a budget is that you can give knowing that your needs are taken care of.

As we have moved and settled in to a new place, we have called on so many friends and neighbors to help us pack, unpack, and haul our stuff.  Being in a situation where I needed help allowed me to better see others who I can help.

Budgeting should be the same way.  It should not be done with a stingy- " I need every penny for me" attitude.  It is all about finding ways to save money so that you are more able to bless the lives of those around you.

Budgeting- Make Saving Fun

Make Saving Fun.
If you are not careful, budgeting can be a grueling & discouraging task.  I know that I enjoy saving a lot more when we budget for fun things along with the necessities. 

For example, we have in our budget all of our summer trips & the amount we plan to spend.  We save for those adventures just like we save for retirement & health care expenses, even though they are very inexpensive.  While our other savings goals will take a long time to reach, it is much easier to see the progress in our smaller budgeted items.

As we save for fun things, I am more motivated to stay within my budget.  I know that if I go over in my groceries or eating out budget, I will have to take money out of my clothes shopping budget or our summer fun budget.

"A part of what you earn is yours to keep" -The Richest Man In Babylon

It is important to remember to pay yourself.  Save for fun things to keep yourself motivated enough to reach the big goals.

Budgeting- Set Savings Goals

Set Savings Goals
When both Daniel & I were in school, saving money instead of spending our savings was a huge deal- and very rare. Now we are able to put a little more aside in savings, we have made goals each month for our savings. This is our proccess:

1st- We guesstimate what our earnings will be at the beginning of the month.
2nd- Subtract our fixed expenses (Rent, Insurance, cell phone, Electric)
3rd- We set goals for what our variable expenses will be. (groceries, gas, car maintenance)
4th- Using these numbers, we decide how much we will save. Throughout the month we track our earnings and expenditures to ensure we are on course to meet our goal.

Setting goals helps us to have direction, and save a lot more!  If we did not have goals, we would be happy with a lot smaller amount of savings.  Setting big savings goals pushes us a little harder to find ways to earn & save money.

Learn more about our Financial Goals and our plans to reach them here.

Budgeting- Analyze Your Spending Habbits

Analyze your Spending Habits
It can be so helpful to look back at your budget at the end of the month and analyze where your money was spent. It is amazing how all the little things add up! We look at our budget at the end of each month to see where we spent the most and where we can cut back. It is a great self check.

Here are a few weaknesses we have found and how we have tried to overcome them.

Eating out. We don't eat out often, but it is very tempting at the end of a busy work day.  To combat the desire to go out to eat instead of preparing a meal at home, we now create a menu plan at the beginning of every week.  This way we know what we plan to eat for dinner & that we have all of the necessary ingredients.  This also allows us to coordinate our meals with our schedule for each day.

We have also tried to do some Freezer Cooking.  We have not planned a whole month of meals, but we try to keep one or two meals in the freezer or fridge just in case.  If we are in a big hurry, or just don't feel like cooking, there is a simple option for us.

Activities. We love outdoor activities, and it would be very easy to spend a large part of our budget on some of these activities- either for equipment or park passes.  We still budget some money for these activities, but we have found a few ways to save money on the things we enjoy.

First, make a list of things you like to do, then try to find a cheaper way to do it. :D

Example:
Renting Movies- use free redbox codes
National Parks (Yellowstone)- Visit during National Park Week when there is free entrance!
We actually bought a pass last year, and our plan was to split the cost with another couple.  We never did it, but that would have been a more cost effective option.  You can get a year pass to Yellowstone for $50, and there are 2 spots for signatures.  It is $25 for a one week pass, so you would only have to go once to make it wort it!
Camping- we have found several places that let you camp for free, you just have to look.  If you do pay for a campsite, take a few friends & split the cost.

Budgeting- Know your Prices

Discover Your Stock Up Price.  It is important to learn what a 'good' price is for an item, and then set a price goal for individual items.

For example, I have found that I will not pay more than $1.69 for milk. I can price match the Smith's add at Walmart instead of paying the labeled price of $2.06.  Just spending 30-60 cents less on milk saves a little from my grocery bill each month. This same idea should be used on all your groceries- find the low price & stick with it.

How? I recomend starting with the top 10 items that you use every week.  Make a list of the items, then keep track of how much you spend on that item. It may take a few months before you see the trends in sales and the rock bottom price, but you can slowly learn how much you can expect to pay for each item. 

Why? Once you have developed a 'stock up price' for an item, you can be a smarter shopper.  This will help you set a realistic budget on your groceries.  If you only buy items at their lowest price, you will see a significant decrease in the amount you spend each month. 

You find more posts about building a stockpile & stock up prices by following the links or looking under the frugal tips tab.

Budgeting- Keep it Simple

Before you are able to save mega bucks using coupons and shopping deals, it is necessary to understand the importance of a budget. There is not one right way to budget- you just have to find something that works for you.

My husband and I have been experimenting with a few different methods to try to find the perfect way for us to budget. We are still not there, but we have learned a lot in the proccess. Over the next few days I will share a few things that I have learned from keeping a budget.

Keep it Simple. This is especially important when you are first starting a budget, don't let it get to complicated. If you try too much at once, it becomes a dreaded task.  Make it something you can look forward to.

At first the excel sheet that we used for out budget had slots for each individual item that we purchased- milk, eggs, bread, etc.. Going through each grocery receipt was quite a task. Now we have things in categories. This allows us to see where our money is spent each month without spending so much time organizing.

Budgeting is something that Daniel & I work on together.  We get excited about how much we save, and motivated to do better when we are behind on our goals.

You can read more about how we currently have our budget system set up here.

Keep an Accurate Budget for Free!

Use a Free Computer Program to Keep an Accurate Budget

Last year Daniel & I used an excel sheet to keep track of our budget.  It worked great- we were able to keep track of where we spent our money & how much we spent.  It was not, however, always right on.  Every month our excell budget total savings was a little different than the amount in our banking acounts, but we did not want to BUY a program to help us save money...

Our accountant reccomended that we try using a free version of Quickbooks (you can download it from the Quickbooks website).  This would help us keep a more accurate record- and help him prepare taxes next year.  :D  Since he knows the tax rules best, if he can see exactly where our money was spent, he can more accurately call out itemized deductions.  We decided to give it a try- I was afraid that the free version would not allow us to do very much.  I am happy to report that it has worked great!

QuickBooks allows us to easily ballance our budget with our bank accounts.  We have created customized ballance sheets to see where we spent our money & how we did on our grocery budget. 

If you are working on developing a budgeting method, I would recommend finding a free program.  Quickbooks is the only program that I have used, but I am sure there are other free options available.  Our excel sheet worked, but we have found that using a specialized program has saved us a lot of time and given us more options.

Visit Frugal Friday & Thrifty Thursday for more Money Saving Ideas!

Part 2 "Control Thy Expenditures"

The second step we are learning in The Richest Man in Babylon by George S. Clason is to control your expenditures.

"That what each of us calls our necessary expenses will always grow to equal our incomes unless we protest to the contrary"

Isn't this true? I have seen it in my own life and the lives of friends and family. We learn to live on very little. When our budget increases, we buy more things and find ourselves as poor and savingsless as we were on a smaller income. A vital step to a budget is to realize that there are more desires to be fullfilled than money to fulfill them, whether you are rich or poor. We can learn to live on 9/10ths of our income and save the 1/10th.

How to do this?
Here are 3 steps our book taught us:
First-Make a list of desires.
Second- Pick which desires you can afford within the 9/10ths of your income
Third-Forget the others

This may seam simple- cause it is. But the principle is true. We often think we NEED something, when it is really a want and something that can wait. I do have a fourth step to add to these though.

Fourth- Get more for your money by Using Coupons!

Many of the items that are now a regular part of my monthly budget; medicine, snacks, cereal- were things that I had determined to be too expensive before I began using coupons. Now I spend less money on groceries- food, medicine, office supplies, personal care products- and I get more. Learning ways to make your dollar last longer is one way to fulfill more desires and still save money without increasing your income.

7 Ideas For a A Healthy Budget

Part One-"Start Thy Purse to Fattening"

My husband and I are reading a book called, "The Richest Man In Babylon." In the book, the richest man in Babylon is teaching 100 men how he became rich. He teaches them "7 cures for a lean purse". I have decided to use these themes for my budgeting series.

The first step is to "Start Thy Purse to Fattening." We learned from our reading today that the first step to becoming wealthy is to spend less than you earn. At first this sounds a little backwards. It seams like you must first be at least a little bit wealthy in order to be able to spend less than you earn. The key is to spend LESS than you earn- not earn more than you can SPEND.

On a college student budget this can be tough. If you are not able to work while in school, this may even be impossible, but the principle can be practiced and applied at all stages of your life. The principle is that if you are not making any money, you should be spending as little as possible. If you are making a little money, spend a little less than you are earning.

When my husband and I were both in school we were not working enough to pay for much more than our rent, so the rest of our monthly expenses came from savings. Even then, we were able to implement this principle by setting a limit to our spending. We did not spend money on unnessesary things. As we practiced this, we began to realize more and more things that we could do without. We moved to a smaller, much cheaper appartment; we were more aware of how much electricity we used; we rode our bikes to school instead of driving- all these things cut out unnecessary expenses.

Now that we have a small income, we are able to set goals and set aside savings each month. Right now this will rebuild the savings that we have been spending during school. Eventually, we will be able to invest this money, which is another step to come. So, step one, cut out all those unnessesary expenses that you cannot afford.