Make it Stretch

Every month, I have the same reaction to the percentage of the monthly budget that goes towards rent. It's a large chunk of money, and quite frankly too much in my opinion. Unfortunately, the rent isn't something that can easily be changed (at least at the moment). I decided that my energy would be better spent focusing on spending categories where I could make a difference, that is, categories that did have some wiggle room. 

Below is the breakdown of the monthly budget.  

Monthly Budget Income Allocation

Housing
54%
Food
18%
Savings
15%
Transportation
3%
Giving
3%
Personal
5%
Lifestyle
2%
Health
0%
Insurance
0%
Debt
0%

You'll see that most categories are below 5% which is great, and no debt is an added bonus. So what next?

A few weeks ago, I posted about going over budget on food and groceries. This was not something I wanted to repeat, so of course, it was a topic for the next budget committee meeting. Upon reviewing the budget it was determined that after housing expenses, the next largest category was Food (18%). Since that is one that is actually manageable it's  TIME TO TACKLE THIS FOOD BUDGET! 

Is there room to decrease spending? 

The first step was to understand why so much was being spent. Overall, spending was reasonable, however, there was a catch. After doing the weekly grocery shopping, we would make additional purchases at a more expensive grocery store for some specialty items. That was what was causing the overages in the weekly food budget. 😮

Now what?

Now that the cause of the overspending was determined, we needed a plan. We decided that it was fine to shop at both stores, however, we'd need to spend less at the main grocery store to leave room for spending at the more expensive grocery store. 😉

It's a deal!

That worked.👏 By spending less when doing normal weekly shopping, we were able to still squeeze in some specialty items without going over the budget. 

So how do you make your dollars stretch? 

In my example, I shared how we identified where we were overspending and came up with a plan to spend less. That's only part of the work. The next step is to track spending over the next month or two to see if we spend all of the budgeted amounts or have some money left over. If there is money left over, then it is safe to lower the amount of money allocated to the Food category and reallocate it elsewhere (like into savings).

Here is the deal...everyone's situation is different. The categories where most of your spending happens may differ. The key is to identify opportunities for savings. Figure out where you're overspending and figure out a way to get back on budget and eventually hopefully under budget.  Maybe your overspending is on restaurants, clothes, shoes, electronics, leisure, etc. Whatever it is, take control and make those dollars stretch. 

Managing your money like a boss means checking yourself when you need to be checked, monitoring your spending, and staying on track. You work hard for your money...make it stretch!