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Budgeting and Saving Money with the New Year

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Several weeks ago, when I was talking about different books I had been reading, I mentioned How to Blog for Profit: Without Selling Your Soul. The book is by Ruth from Living Well Spending Less. I decided to check out her blog and was very inspired. Time to start saving money! I love making budgets and helping people with financial stuff (so weird, because I hate math!) so I thought I would make this post with the New Year. Especially since I made a resolution to save half my money each month!

I have always liked budgeting and saving money. There are two ways of saving money; actually putting money in a bank account and using coupons and deals to buy items for a lower price in the stores. We’ll get there, but first; let me talk about…

My First Bank account and what it did for me

When I was about eight or nine years old, I had a job helping my grandmother to clean my dad’s datacenter. We would clean the bathrooms, kitchen, and dust the ledges and desks. Muttie paid me $2 a week to help her. I would dust and wipe the kitchen table and watch her clean everything else. :) (Oh me, that was so long ago!) Granddaddy and I opened a bank account at a bank in our neighborhood, and every couple of weeks, we would go and deposit my money. Of course, sometimes I would save it out to go to Earth Fare and buy candy. (and I am wondering why I have so many cavities.) Most of the time, though, I would put it in the bank. Sometimes I would get money for my birthday and I would put that in there too. Finally, when I was twelve, I wanted to buy an iPod 5. My parents said they’d pay half. So I went into my bank account and withdrew all my money! I had just enough. I hadn’t even known what I was saving for, but am I glad I saved it!

Fast forward a year. At thirteen, I wanted to open a checking account to have my own debit card. We had some difficulty finding a certain bank and branch that would let a minor have a debit/credit card, but we succeeded! Along with my checking account, I also opened a saving account. However, all the money I have been earning goes straight into the checking account….and then straight to Amazon. I have a buying problem. With a debit card, all I had to do was to set up an Amazon account. Which means that for several weeks, packages were coming to me almost every day. (I finally stopped that when my free trial for Prime ended 😉 )

Funny fact: One of the biggest things I can remember about the girl who helped me set up my first bank account is the fact that she wore fake French manicure fingernails.

Here’s the problem with not saving.

What if your phone suddenly breaks and you have to buy a new one? What if your laptop needs to be replaced? What if you really want something but it is expensive enough to make you save all your income for several months? What if something happens to your car and you have to get it fixed – but it is so expensive that you don’t have enough money? Therefore, you have to get your parents to lend you the money and then you’re in debt. I hope to never be in debt. However, I realize that if I don’t have any money in my savings, I have a high chance of it.

This is why it is important to save money. Unfortunately, I have not caught the hint from myself yet, but I am striving to change that. Currently, though, my savings account is $1.65.

Moving on.

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Where does my money go and what for?

Basically, there are two parts where your money has to go when you’re on a budget. Saving and spending. However, there’s more to it than that. I categorize my saving into two parts – Long Term Saving and Short Term Saving. For short, LTS and STS. For me, long term saving is anything you’re saving for that is longer than five years. For example, marriage.  Or, it can also be an emergency fund – like if your laptop breaks down and you don’t have quite enough to cover it. (Not a good idea, because I’m the girl who can’t email from anything other than her laptop.) Grow this by depositing a sum monthly and never taking anything out of it other than emergency funds. As an example: I like to save 50% of my income each month. I would put 35-40% of savings into LTS.

For me, short term saving is basically just saving up for items that you can’t afford yet. After subtracting 40% from my monthly savings, I would STS 60%. I want this to grow much faster than my LTS, as I will need this to pay for upcoming items. Items that are just a little more expensive, like a new flatiron or hairdryer, or a big order of DIY supplies that I need.

Lastly, spending. After subtracting $80 from saving monthly, I am left with half of my original total. This is definitely not a lot, but remember that you can save on purchases. Use coupons and discounts.

Questions to ask before buying anything

I can say quite honestly that I’m a frugal and careful buyer. I don’t buy anything over $10 that I don’t really need, and I certainly think over it for several days before purchasing! I am also a very practical person, at least when it comes to purchases. You will hardly see me buying anything for the mere fact that it is cute or pretty. It has to be multi-purposeful and durable. (two of my mom’s most hated words when it comes to purchasing! :P) I ask these questions before buying anything.

  • Do I need it?
  • Will it last for several months?
  • Can I make it instead?
  • Is there a less expensive option?

How do I ask for money or items?

Birthdays are definitely good times to get a little more help on saving money. Is there something you have wanted for a while that is a little more pricey? For me this past year, I had wanted a year-round, good sized, practical purse. My navy-blue denim Kate Spade purse I had gotten when I was ten had really worn out, but my mom was still able to sell it on eBay for $40. I told my mom that I really needed a new purse. We were at a Coach outlet when I saw the purse I was looking for. It was cream with gold studs, made out of leather, and a very good size. I could see that it would last me for several years. My parents are pretty generous when it comes to birthdays. This year, however, I knew that this purse was the only thing I wanted. My parents saved me so much money by giving it to me for my birthday. If there is a more expensive item you want, you can ask your parents and some of your relatives to all chip in for your birthday present. Friends, however, are a little touchier as you have to be careful in making it clear what you want. You can try an Amazon Wishlist, but you can also drop hints here and there, and could also ask for Amazon gift cards. (Amazon gift cards are the next best thing to cash for me, just letting you know!) I know that I also really appreciate jewelry because my friends know my style pretty well and I rarely splurge and buy jewelry for myself. (too practical!)

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How do I save money in shopping?

I shop on Amazon.com for 95% of everything I buy. Normally they will have several of similar items at different prices. You want to get good use out of what you buy, so choose the lowest price at the highest rating. I don’t buy anything that is rated less than four stars. As for clothing purchases, make sure that you don’t have a duplicate hidden in your closet. Make sure it will be versatile, practical, and something that you can make several outfits out of.

Look online for things you can make instead of buy. Especially in the cosmetic industry, many companies will make millions out of overpriced, cheap quality and bad-for-your-skin items. There is so much makeup and skincare you can make at home, and recently I have been working on making all of my makeup except for mascara. Acne products are big-time spend, as many products overcharge for products containing toxic ingredients that won’t help your acne at all. I already do not buy face scrub, face wash, face masks, serums, toner, hand wash, lotion, and lip balms, for the simple fact that I can make it all at home for so much less, and sometimes literally pennies.  The initial cost of buying items to make your own makeup or skincare is somewhat pricey, but with those ingredients you can make so many items!

Plan for the future. If you know that you will need summer clothes, watch the stores come fall. Take advantage of the discounts that come out. For example, in the fall, many stores will put out their summer stuff on sale. My mom will buy the summer clothes for me while they’re on sale in order to save money.

Shop at thrift stores. When I see a good deal, it makes me happy. Shopping at thrift stores may be somewhat embarrassing at first to some people, but you save so much money!. Browse yard sales, too! You’d be surprised how many salvageable things you can find that can be re-purposed. An old wooden bench? Sand it down, re-stain or paint it, add a couple decorative pillows, and you have yourself a cute seat! Shopping at consignment stores is great to find designer clothing for very inexpensive. If you know how to sew, you can alter the clothing yourself! Are you a book devourer? Used book sales can save you a TON of money. Don’t forget that Amazon sells used books too! (also used textbooks, by the way) A lot of times you can get used like-new books on Amazon for $4 with shipping.

I hope that my post was somewhat helpful! If you have any questions, don’t hesitate to contact me through my agirlandacat website!

xoxoxo
Your advisors Aria $ Luvems :)

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