Forget the Budget: Create a Spending Plan (Video)

Nobody likes to have to make a budget, but that doesn’t mean you can’t enjoy making a spending plan. List everything you spend you money on each month. Have your family members do the same. It can be a family game. What are the things they want to keep? What can they do without? Erica Sandberg explains how to set up a spending plan by focusing on key areas.

1. Groceries:
   • Try eating more vegetarian meals because meat is expensive.
   • You should also reduce on eating out, especially fast foods. It adds up.
   • Another good idea is to go online shopping. It helps you stick to your shopping plan and usually provide extra discounts and coupons.
2. Services:
   • If you’re paying for cable TV, Internet and cell phone bills, try bundling them together to cut down on costs.
   • If you have a phone landline, you might want to consider cutting it. You could save up to $100.
3. Entertainment:
   • Forget about going out.
   • We all spend a fortune on entertainment, but you should also remember that there are places where you can go that won’t cost you a dime. Your local library is a good source for books, movies, CDs, games, and more. The best part is it’s all free.
4. Gifts:
   • Skip gift cards. People who give gift cards tend to bump up the dollar amounts to avoid seeming cheap. Plus, you can’t get bargains when buying gift cards.
5. Insurance:
   • Make sure you shop around. You could be eligible for special rates and not even know.
6. Wants vs. Needs:
   • Analyze each purchase you make to determine what’s important and what you probably don’t need. This way, you can keep more money in your wallet.
7. Credit Cards:
   • Forget the credit cards. Credit cards are great, but we do have a tendency to overspend when using them. Always remember, try to keep debt at zero.

Erica Sandberg is the author of Expecting Money: The Essential Financial Plan for New and Growing Families, a columnist/reporter for CreditCards.com, and writer for the San Francisco Chronicle’s SFGate. Her articles and insight are featured in such publications as the Wall Street Journal, Redbook, MarketWatch, Forbes.com, and Smartmoney.com. Erica is the financial education director/co-host of the web program Change Starts at Home, and a frequent guest on ABC News, Forbes Video Network, Fox Business Network, Businessweek-TV, and National Business Report. Prior to freelancing, she was affiliated with Consumer Credit Counseling Service of San Francisco for over ten years.