Budget Suggestions for a Frugal Household

A budget is a necessary tool for any family that wants to trim the fat from their spending. And, we all can use a little less fat. To begin we need a few basic items.

1. Pay stubs. Each person that contributes to the monthly income of the household needs to figure out how much they bring in on average each month. This is easier for salaried employees. This is the money that you have to spend on expenses and savings each month.

2. All bills. Anything that you receive a bill for each month needs to be accounted for. Forgetting something can put a chink in the armor of your budget. Include furniture payments, credit card bills, utility bills, school lunches, club memberships of all types, car payments, mortgage, and insurance payments. You'd be surprised how much you pay out.

3. Extra income. This can come from a hobby or an occasional service you offer that pays you. This income is a supplement that can help you save money. Resist the urge to spend more.

Cutting Expenses

Take out the scissors and go to work. Cutting expenses doesn't mean that you have to cut out everything. Even cutting back on how much you spend on one thing is a help. Some things will need to be done away with especially if you have a goal in mind that you want to achieve such as a vacation or college fund savings.

1. If you want to watch movies, invest in an online membership like Netflix.com or Blockbuster.com. Online, you save gas by not having to travel back and forth to the store. These programs offer the option of renting one or more movies at a time. One movie at a time can cost as little as $5.99 a month.

2. Eat at home more often. This is difficult if your family is on the run all the time. Create low cost, easy to fix meals that can be ready in thirty minutes or less. Any of Rachael Ray's cooking books can give you a ton of ideas about that.

3. Learn to do things around the house yourself. Instead of hiring a lawn service, cut your own grass. A lawnmower will pay for itself in no time especially in the summer months. Use a truck and a friend to carry items home from the store and avoid delivery charges. You can hire out for major things like electrical or plumbing problems but shop around to get the best deal.

4. Shop at other stores besides large chains. Consider a thrift store or goodwill when shopping for clothes. Many people think that these stores are full of junk, but in fact, you can find many clothes with price tags still on them. The Habitat for Humanity store sells good quality furniture and many other items at greatly reduced prices.

Get the Family Involved

For frugal living plans to work it takes the participation of everyone in the house. Working together to create a budget encourages kids to adopt the same financial values in their lives.

1. Have a yard sale. It is time to clean out the clutter. Go through your closets and the garage and find items that you don't need any more. One a clear sunny Saturday, hold a yard sale. Families can make extra money towards trips or other activities. Anything that is in good condition but doesn't sell can be given away to charity. Depending on the value of the items, you can get a tax deduction at the end of the year.

2. Sell on eBay. Everyone is doing it and some are making a whole lot of money. If you have a hobby like crafting, try your hand at selling your products online on eBay. Membership is free but you do need to pay a listing fee and a small percentage of the price when the item sells.

3. Get everyone outside on a Saturday to do yard work. With everyone helping, it will take less time to get it done. Using your own labor force means you won't have to outsource.

Sticking to It

It is hard to change. In fact, for a habit to become a part of our lives we need to perform it for at least two weeks. With a budget, go for three months. This gives you enough time to see if the changes that you have made are working. If they are, you will be spending less and saving more.

One way to stick to the budget is to automatically put any extra money in a savings account. This includes money from yard sales, hobbies, raises at work, and bonuses. Since you didn't have this money to count on before, you won't miss it if it goes straight to a savings account. When you have reached $500 or $1,000, place the money in a certificate of deposit or an IRA account.

Budgets are subject to change. If you find that the restrictions in one area are causing you to cheat on your budget, add more money for that area and lower the allowable spending in another area. Budgets are fluid. They change as your financial picture changes and your circumstances change. Don't be afraid of it, but use it to help you live the kind of life that you want.

If you need to, purchase financial software to keep track of spending habits each month. After three months see how you have done. Don't be disappointed if you didn't quite hit the mark. As long as you are trying, you are committed to doing a better job of money management.