Penny Wise

Ever found yourself in a season in which you had to literally turn each dollar twice before spending it? Trying to make a dollar out of fifteen cents? A season of financial stretching in which you really had to “cut your cloth according to your measure”

Seasons like these are the norm rather than the exception for the most people around the world nowadays as living costs continue to soar in the face of limping economies which just cannot seem to gather any pace, insatiable natural disasters as well as wars and rumours of wars.

With the benefit of bit of hindsight, my fair share of mistakes and victories, I thought I’d share some hints and tips that have seen me through many “penny wise” moments. One of the key lessons that I have learnt in this area has been that it is vital to take ownership of our most valuable resource – time – the only currency that each of us has to spend which is absolutely irreplaceable. Combined with our expertise, a good set of skills and most importantly wisdom, our currency of time is a formidable weapon in our quest for victory over penny wise situations.

Most of us will have a good idea on how much our total household income amounts to either weekly, monthly or annually – but without a budget, it will be almost impossible to track where it goes. So to start with I would suggest tracking where your hard-earned income is ending up by preparing a budget. This will help you to have an idea of what to trim off and where to make changes. Don’t be afraid or intimidated by the idea of a budget. It’s not a form of imprisonment but rather, it will help you to monitor your expenses in relation to your income. Your budget is your friend. Take time to plan it carefully and be disciplined enough to stick to it so that you spend less than what you earn.

In addition to preparing a budget, do shop smartly. Depending on where you live in the world, smart shopping can save you lots. Get loyalty cards if the shops you get your groceries from have them. If you already are going to buy anyway, then you might as well enjoy the rewards that come with the accumulation of loyalty points. Just don’t get tempted to make unnecessary purchase s in the hope of accumulating points. They will add up eventually and you can redeem them for a shopping voucher or whatever else they offer once you have earned enough points. In some countries, coupons are widely and easily available…use them! If you struggle with impulse buying then try the online shopping facility which most shops have. Ever gone into a shop to pick up just a handful of items, taken a basket and after a few minutes up and down the aisles you find yourself heading to the door to get a trolley because there are too many ‘specials’? An hour later you emerge with a trolley and a bill more than you had planned for initially. One way to avoid this dilemma is to only carry and use cash.

Yes, carrying the specific amount you need to use will instantly curb the ability to impulse buy although not the desire. Unfortunately even if the desire is there,it cannot be satisfied because you cant spend what you don’t have. Carrying cash means you do get to think about each purchase. Sometimes using bank cards doesn’t feel like you are using ‘real’ money until the statement comes then you realise that the figures indicate ‘real’ money alright. With cash, once you’ve spent it all, you see that its finished but with some cards, once its finished it begins to dig into some other ‘source’ that allows you to go deeper under the ‘empty’ level and leave you in debt and owing the bank.

Don’t buy something just because it’s on sale. Even if it’s on sale, ask yourself if you really need it. Buying something just because its on sale and then not using it is like literally throwing out the money. Make the most of your local markets for fresh produce. Buy fresh fruit and vegetables in season and clothes out of season. This does save you heaps especially if you have young kids! At the end of each season most shops will have massive sales where you can save more than seventy five percent depending on where you live. This is a good time to buy clothes for the next year and for my children I normally just buy a size up so that they can use these the following year.

In addition to being much cheaper, buying fresh food in season will ensure that you get optimum nutrition at a good price. Fruit always tastes better too when it’s in season. I also believe that each place bears certain fruit in particular seasons because the nutrients in those fruits are what our bodies need for optimum health during that season and help to prepare for the next season.

If you have gym membership that you got as one of your new year’s resolutions and you pay monthly but still have it on your ‘to visit list’ then you are better off cancelling your membership and making use of the free local sporting facilities. Some schools will allow you to use their tennis courts for free and you could turn this into a great and fun way to exercise as a family if you have one. A soccer ball can work wonders for your fitness if you make use of local parks. There are basketball courts too and jogging is another great form of exercise….just be sure to get proper running shoes!

So, overall, keep a tab on how much you spend in relation to your earnings. Live within your means and cut your cloth according to the measure you have. If you are already in financial doldrums, keep calm; get financially literate by investing in good books on the subject of ‘money’ and take up the challenge until you get to the shores of financial freedom.
Till next time…thanks for stopping by