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Modified Spending Freeze
Congratulations! You made it through the spending freeze!
Here’s the deal. If you carry consumer debt, the only way to get out and to get out quickly is to continue on with the Spending Freeze. If you don’t continue on, the chances you’ll revert back to bad habits are pretty likely. Make it your goal to make it to the remainder of the FTJ Boot Camp (only three more weeks).
If you are a Boot Camp “recruit” that doesn’t carry consumer debt, you are hereby granted permission to go on a Modified Spending Freeze, with the following things in mind:
Impulse purchases are what get the majority of Americans in trouble with their finances. We are going to be working in a few more of the “wants” into your spending this month, but none of them are allowed to be impulse purchases. For the 21 days immediately following the Spending Freeze, you will need to think about something for 24 hours before you purchase it. This phase is called the Modified Spending Freeze.
Make a List, Check it Twice.
Create a second approved spending list for the Modified Spending Freeze. Go ahead and include some of the wants you’ve been avoiding purchasing since starting the Spending Freeze. However, the items must be on the list for 24 hours before you purchase them. This will help you avoid buying things you really don’t need (or could get by without) and haven’t completely thought through. Include things like clothing items your family may need, one lunch out per week (if your financial situation allows), gifts, and so forth.
Make sure that you and your spouse are in agreement about what’s on the second approved spending list. Set a dollar amount that you have to get spousal “approval” on before it is spent. It could be $20 or it could be $200: The important thing is to choose a number appropriate for your own situation. Consider your net worth statement when approving big purchases. If you have considerable consumer debt, no amount of thinking or pre-planning makes certain purchases OK. Keep that in mind.
Consider Your Mood before You Shop
Everyone knows you’re not supposed to go grocery shopping when you’re hungry. My husband can attest to that – that could be why we have enough food in our pantry to live off for several months. I can also add: Don’t go shopping for scrapbooking supplies when you’re bored or go to Old Navy when need a pick-me-up. Of course most of these emotions are temporary, but the bills aren’t.
Knowing exactly how and where you spend your money will provide you with key information about where your money goes. It will also give you valuable insight into what your spending weaknesses are and provide information about what you can improve upon.
For the remainder of the Forget the Joneses Boot Camp, account for every penny you spend. There are many ways to track your spending. It’s important for you to pick the method that is easiest for you, fits your lifestyle, and one that you can stick to.
• Keep a Spending Journal You can use your small spiral-bound notebook to do this, one that fits in your purse works well. For every item you buy, track the amount spent and to which category it belongs, such as: groceries, gas, entertainment, restaurants, clothing, and so on. (PERFECT! My grandma came to visit today and gave me a goodie bag: it included cookies, candy, a pen, a little notebook, and my favorite thing in the world...LOL little package of tissues. Then...if I can brag a little, 3 handmade quilts and 2 pillowcases)
• Save Receipts in an Envelope This is a really simple way to track spending because it doesn’t require much time. Simply grab an envelope and make sure that both you and your spouse account for all of your purchases – whether cash or credit – by placing the receipt in an envelope. If you make any purchases where a receipt isn’t available (vending machines, for example) write the amount spent and the item on the envelope itself. This works well for spouses who may be less than cooperative. It isn’t too much to ask them to simply hold onto their receipts. (This will help me clean up my planner...its a mess full of recipts!)
• Use a Program Like Quicken or Money This can be done in conjunction with keeping a spending journal or a receipt envelope and works well for those who plan on using a computer program as a part of their budgeting system. Don’t worry about categorizing the purchases right now. Simply gathering the information will be sufficient. After the end of the three weeks, we will begin to categorize your purchases so that you can create a budget.
• Use Online Sites Like Mint.com If you want to take electronic budgeting one step further, consider an online tracking site like Mint.com. Not only does Mint.com use features like Quicken and Money, it connects to your banking/credit card information nightly to automate the process even further. Best of all, it’s completely free.
Assignment: Come up with a Second "Approved" Spending List
Be a Proactive Shopper
In the weeks left of the FTJ boot camp, I want you to change the way you view your meal planning and grocery budget. Become a proactive grocery shopper vs. a reactive grocery shopper. Instead of buying something when you need it, you’ll be buying it when you can get it at the best possible price.
Continue to create meals based on what you have at home rather than what you want to eat. Then, use the money in your grocery budget to build your stockpile – with an emphasis on your frugal meals list and pantry list.
Being willing to try new things can also help you save. Are St. Louis Ribs half price this week and an additional $1.00 off with a coupon? Score! Even if you don’t regularly make ribs, that’s a great deal, and can bring the price of a typically more expensive meat down under that of ground beef or chicken. Make it your goal to learn new cooking techniques. You’ll experience some flops along the way, but over time you’ll build up a great collection of recipes that will enable you to take advantage of great deals with confidence.
Use your price book as a guide to research what are truly the best grocery bargains and purchase those things when the time is right. Eventually, you’ll have a large enough stockpile so that you will be able to create your family’s favorite meals with what you have on hand at home already.
Most of us have lots of people on our gift list throughout the year, but it’s something that we often fail to plan ahead and budget for. Keeping a master list of every gift you need to buy throughout the year: not just holidays and birthdays, but teacher appreciation gifts, and other holidays like Valentine’s Day, Easter, and so on can help you save money as well as stay organized. Write down everyone you need to buy for and when you find a great deal, snap it up and check that person and occasion off your list – no matter what time of year it is. Keep your “gift stash” in one place so that when you need to find the gift you know where it is. You may also want to keep a few generic gifts for baby showers, housewarming parties, and other unexpected occasions.
Kids’ Clothing List
A key to saving money on kids’ clothing is to shop the end of season sales for the following year. The problem with this is that moms often just shop randomly instead of really determining what they’ll need. Consequently, they often overbuy certain things and underbuy others. It’s a good idea to keep a short checklist of what your kids go through in a given season. Your inventory might look like this: Three pairs of jeans, two pairs of dress pants, two sweatshirts, five t-shirts, underwear, socks, tennis shoes, dress shoes, coat, etc. Then, when you see those end-of-season sales, you’ll be able to buy what you truly need and skip the things you don’t.
Ongoing Wish List
This is one that I keep for items I’d like but really don’t need. My list usually looks something like this: pair of brown leather boots, wall décor for living room, sheets for queen bed, etc. I keep my eyes peeled for sales, but realize that I won’t buy these things unless I find the right item at the right price. I know I need to replace the sheets on our bed soon, but I can wait for a 50-75% off sale. I also have my list handy if anyone asks me what’s on my wish list for birthdays and Christmas.
**I need to actually pick up stuff for my gift list. I have ideas written down to when people mention things. I need to pick up things for easter, moms bday, fathers day, rylans bday, zacks bday, and so on! I also want a headstart on christmas this year!!!
Tomarrow, on my to-do list I have put to make inventory of Rylans babyfood, and formula and such. Instead of posting it in the pantry(im sure my mom would be like WTF is that about?) I will keep it posted in my planner. Also I'm thinking of making a meal plan for him since he still needs to try new foods to check for allergies.
Clothing Inventory...for all 3 of us! Rylan is growing out of his 6-9 month clothes and hes only 8 months. LOL, but yet when he was born, we had a few newborn outfits and lots of 0-3 months...ended up we had to go buy preemie clothes...AND preemie diapers, for an unexpected early arrival.
Ongoing Wish List. We also need a new sheet set...and actually a whole new bedset!
I also will be updating my price book. I've kept all the recipts. I'm planning on moving it to a bigger notebook because its driving me nuts!
Guess I'll be adding making an 2nd approved spending list...which will suck. This will include the 500$ my boyfriend needs for fiberglass***