The key to living beneath your means is not necessarily tied to how much money you bring home each month. The key to real financial freedom is effectively managing your money by prioritizing spending. The three strategies outlined below are great ways to build savings by helping you to learn to make better choices in how you spend your money.
Drop the Competitive Pride
Trying to keep up with others materialisticly is a never ending roller coaster. You already know that the satisfaction of having more and bigger only last a short time and then you are off again on the lookout for something new or better. Once you rid yourself of the sin of pride by humbling yourself to reality, the fat from your household budget can really start to be trimmed.
After eradicating the pride, look around and be grateful for what you do have and work within that. Differentiate each purchase between a need and a want. Living beneath your means is asking yourself questions such as, "Do I really need this?" and, "Do I have something similar already that still adequately does the job?"
Honor God With Your Money
Be a good steward of what you have been allowed to have, asking God for his input.
Saving is Not Optional
Consider the savings category in your household budget planning process as a necessary expense. Even if a few dollars each month to start, develop this lifelong habit that will serve you well years and decades down the road. Emergencies always happen and it is better to be financially ready for them as opposed to needing the use of credit card debt.
For living beneath your means effectively, have a goal to save 10% to 20% of your net take home pay (after taxes). If you get paid weekly or twice per month, break up the amounts from among the total monthly paychecks. Breaking up your savings goals into manageable chunks makes the overall figure far less daunting or intimidating. If you are unable to save money, then rethink your current spending or increase your income by finding a new job, adding a second one, or starting a small home business.
Trimming the Fat
Here are some practical ways to reduce spending:
Cut out cigarettes. Think about it financially. A pack of cigarettes in my area runs $4.00. That is $120 a month and $1440 each year! Just saying…
Cut the grocery fat. Do you realize that it is possible to feed a family of six that includes two hungry adolescent boys on $12.00 per day or less? I know because we are doing it right now. And it is mostly healthy home cooked meals that everyone enjoys!
Budget the fun. Decide ahead of time how much money will be spent on entertainment for the year and have fun trying to spend less than that.
You see, your family's life does not need to be significantly altered to effectively live beneath your means. Reduce your expenses where feasible and refuse to live above your means, even if you have the money to do it with. I contend that implementing these strategies will (not can) save you hundreds if not thousands of dollars each year. Let me know what you think below including your own strategies for saving money in living beneath your means.
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