Need to live a more frugal lifestyle?

You work hard for what you earn so, why not get the most out of it?  That’s exactly what frugal living will do for you.

Frugality is about being wise and prudent with money.  It is not about doing without or depriving yourself.  It is a back-to-basics approach to managing your finances.

Frugal living aims to cut waste.  Less waste means more financial power and freedom.  Cutting back is not hard, but it does require a plan.

Getting Started with Frugal Living

Let’s say your finances are a bit of a mess.  This is probably a safe bet if you are newly interested in frugal living.  Chances are, you have amassed a good bit of credit card debt and you are likely spending more than you earn every month (check the figures to see if I’m right).

In other words, you have dug yourself a hole and now the sides are starting to cave in all around you.  Never fear!  Frugality can get you out of this mess.  After all, credit card debt is voluntary slavery so you want to dig yourself out of that pit sooner rather than later.

The goal is to lower your spending so you have money to establish an emergency fund and pay down what you owe.

Here’s how to get started with frugal living:

Step 1 – Stop the Bleeding

Quit spending all your money.  Reclaim your financial strength by holding on to what you have.  You are bleeding out all your financial power by going to the mall, Starbucks and out to eat so often.  Furthermore, by charging these items on your credit card, you are handicapping yourself even more.  Cut those stupid things up so you aren’t tempted to use them all the time.  You’ve got to stop this incessant drain on your finances immediately.

I recommend going on a fiscal fast for a week (or more) where you try not to spend anything – not even a dime.  I know this sounds radical, but you’ve got to retrain yourself to act differently.  This may require a little shock therapy and there is no time like the present to get started.

During this initial phase, analyze your bank statement from last month.  How much money did you deposit?  How much did you spend?  Which is greater?  If you are spending every penny – or even more than you earn – then you have a serious problem.  One that will ruin you financially if you don’t get a handle on it soon.

Start making cutbacks in as many areas of your spending as possible.  Reduce your monthly outflow fast with the ideas in these two articles:

• Stop Whining And Frugal Up Your Finances
• 20 Ways to Trim Your Budget to Survive Hard Times Ahead

Step 2 – Get a New Brain

This is your brain (imagine an egg), this is your brain without any money – the egg is now in a frying pan with the heat turned up to high.  What do you think is going to happen to you and your family?  Yep, your going to start sizzling pretty soon (if you aren’t already).  Your old ways of dealing with money are killing you.  It is time to find a new brain.  It is time to learn a new way to handle money.

Don’t feel bad.  You are likely just doing what you were taught.  You learned and are following bad money habits that will leave you eating ALPO for dinner, assuming you don’t change your ways, but the story isn’t over yet.  Your future isn’t written in stone.  You don’t have to stay stuck where you are.  You can head in a new direction.  You can get a new brain.

Your new brain will give you a new lease on life.  It will make you feel more successful and happier.  So, how do you get a new brain?  Well, you can be retrained to be smart with your money.  How?  I’ve written a step-by-step plan just for this purpose.  It will lay out everything you need to know so you can develop the new habits you desire and need.  Ones that lead you to prosperity instead of ruin.  You can get your hands on it now:

• Click here for The Super-Charged Guide to Financial Freedom

Step 3 – Revive the Patient

The patient is not dead.  There is still hope.  Your action will determine the outcome.  What are you going to do?  Frugal living is the answer.  I used to think that I would die if I had to change my evil ways related to money.  In fact, I threw a big fit when my wife suggested that we needed to get on a budget.  I reluctantly went along with her after a lot of cajoling and persistence on her part.  However, I soon found out that it wasn’t as bad as I thought it would be.  In fact, I learned a lot from the experience.  So much so, that I wrote three articles about The Things I Learned Living on a Budget.

You might feel like I did.  You might know in your heart that you need to do something, but you’re resistant.  Well, I can tell you that once you’ve tasted the freedom that comes from frugal living, you’ll never go back.  It is an adjustment, but one that brings peace and a sense of control.

You can revive the patient if you’ll give it a try.  It won’t even be as hard as you think.  I’ve provided you with everything you need to bring life and vitality back to your financial situation.  Live long and prosper!

Photo: Copyright PhotoXpress.com

Do you have a positive or negative view of budgeting?

Most people hate budgets.  They think a budget will restrain them and make their lives unbearable.  Are you one of these people?  This is a very detrimental and unfortunate way to think.

How do I know?  I used to think the same way.  However, I’ve definitely changed my mind.

I’ve learned that a budget can actually improve your life. That’s right, the very thing that people despise and avoid at all costs can help them instead of hurt them.  A budget gives you financial freedom.  It doesn’t take it away.

Things I Learned Living on a Budget

Two and a half years ago, I kicked off a three-article series called Things I Learned Living on a Budget.  The articles in this series are some of the most popular on my site.

I just reread them myself and if you are really struggling with or actively resisting the idea of budgeting, then I’d highly suggest you take ten minutes and give the series a read.  I recommend this so you’ll be able to see how my own attitudes on budgeting changed fairly quickly from negative to positive.  If I can change my mind, then so can you.

I’ve lived both ways.  For the first twenty years of my adult life, I lived like everyone else without a budget.  I’ve seen both sides so therefore I’m qualified to tell you which is better.

The Ways a Budget Can Improve Your Life

Today, I’ve been using a budget to manage my money for over four years.  Obviously, my positive view of budgeting has stuck. To me, this means that it is the real deal.  If it wasn’t, I would have abandoned it because it does take a little time and effort.

Here are seven ways that a budget can improve your life:

1.  A Budget Relieves Stress

Financial stress is one of the leading causes divorce in America.  I think we’ve all experienced the tension in a household when money is tight.  A budget helps relieve this stress because it gives you back control over your finances.  It puts you in the driver’s seat.  Stress comes from anxiety about the future.  When you don’t have a budget, you don’t know if you’ll be able to meet your obligations this month or not.  With a good budget, you know exactly where you stand which reduces stress.

2.  A Budget Helps You Focus

Without a budget, no one knows where the money goes.  It is spent willy-nilly on whatever catches our eye.  A budget is a tool that allows you to prioritize and direct your money to do what you want it to do.  It was absolutely amazing to me how much I was able to accomplish financially once I started budgeting.  It is very easy to underestimate your financial strength when you don’t have a budget.  You simply do not have a tool available to focus your financial energy in any specific direction.

3.  A Budget Motivates You to Simplify

Once you start budgeting, you see exactly where your money is going.  This generally motivates people to simplify their lives because they learn that a lot of their money is being wasted on things that aren’t that important.  For example, when we started budgeting, we sold a bunch of stuff that was regularly costing us money to store, maintain and repair.  Simpler truly is better.  It also leads to less stress.

4.  A Budget Provides Freedom

Our budget gives us more freedom and not less.  It reveals when and where we have extra money to spend on the things we want.  Also, it allows us to make purchases without the guilt that was involved before.  We know we have the money so, we don’t have to feel guilty or try to hide what we are doing.  Our budget has also freed us from living with a bunch of debt.  There are a lot of reasons that living with debt BITES, but freedom tops the list and is the sweetest to savor.

5.  A Budget Makes You More Generous

As you get a handle on your finances and create some margin between what you make and what you spend, you will have more money to give to worthwhile causes of your choice.  This is one of the main reasons that we wanted to live on a budget.  It is nice to be able to help our family when they need it.  It is also rewarding to be able to give to charities and our church more generously.  A budget frees up some resources that you can then direct to greater causes.

6.  A Budget Will Make You a Better Citizen

As we started tightening our budget to reduce expenses so we could pay off debt, we discovered all kinds of ways to save that made us better citizens.  For example, we started borrowing our books from the library instead of buying them.  This converted us into supporters of our local libraries.  Also, we lowered our environmental footprint by reducing what we consume and increasing what we recycle.  A budget leads you in all kinds of better paths in life.

7.  A Budget Is Your Path to Wealth

Finally, a budget can improve your life by leading you to greater personal wealth.  You will stop paying so much interest on borrowed money and you will start investing to actually earn interest . In other words, you will put your money to work for you instead of Visa and MasterCard.  It is exciting to watch your savings grow in the bank, in your 401k and in other investments.  The best way I’ve found to make this happen is by living on a budget.

A Budget Really Will Improve Your Life

I will always budget my money from now on.  It is just a better way to live.  It offers less stress, more freedom and allows me to use my financial strength for the benefit of those I care for the most.  In my mind, living any other way is foolish, irresponsible and just plain dumb.

If you are ready to experience how a budget can improve your life, then pick up a copy of:

The Super-Charged Guide to Financial Freedom

It will explain in a simple, step-by-step way exactly how to set up your first budget.  It will also help you to make budgeting a habit that you embrace for a lifetime.  Go ahead!  Click the link and learn more.  I promise it won’t hurt.

Photo by Public Domain Photos

Wondering how you are going to afford a summer vacation?

Summer is here and you have decided to go for a vacation. You know how badly you want to get away from your monotonous work schedule and more importantly, how you have scraped up a few dollars for this trip! You have done your math ten times but still you fall short of a few hundred dollars! Worry not, here are some tips you can utilize to save your hard earned dollars while traveling.

1.  Travel in the Off Season

The easiest way to save money is to travel to a destination during its off season. Many places, for instance Europe and South Pacific, have good weather year round. It does not matter when you go. This can save you hundreds of dollars on plane tickets.

2.  Book Early

Book your tickets months in advance. You can find prices to be quite reasonable if you book your tickets even three months in advance.

3.  Browse the Web

You need to work a little on the net if you want to go cheap. Find a ticket that is just right for you and then compare prices to find the best discount offered.

4.  Cut Unnecessary Expenses

A lot of people spend too much buying stuff for their trip. For example, you might think you need a pair of binoculars, hiking boots or a brand new guide book. Consider whether you actually need it. Strong sturdy sandals can be a good replacement for boots and you can find those guide books at a much cheaper rate with a little budget shopping.

5.  Reduce Mealtime Costs

Eat breakfast at your hotel if it is offered. Eating out can be costly, especially when you have already made the payment for your meals at your hotel. In addition, you can keep snacks such as fruits and sandwiches handy by you and munch on these whenever you feel hungry.

6.  Choose Modest Lodging

Go for a two star hotel rather than a four star. You have come on a vacation to enjoy the attractions and not to pay big bucks for your room. You can even find a hostel to stay in if you are travelling in Europe. Again, book your lodging in advance.

7.  Minimize Sightseeing and Shopping Costs

Don’t buy the first item that you find, shop around and look for the best deal. Avoid ‘tourist trap’ shops that will just shrink your wallet, try open markets where you can find local goods at reasonable costs.

8.  Use Public Transit

Taxis can be quite an expensive means of transportation. If the city where you are staying has an efficient public transit system then make use of it.

Spend a Little Effort to Save on Vacation

Each time that you pocket your savings like this, you come closer to creating a great vacation. Don’t take out a loan for a trip, the thought of paying back the loan with interest will kill all the fun and enjoyment of your time away. What’s more, these strategies will keep you out of debt and help you lead a better life!

Author-bio: Jack Reed is a financial writer associated with Oak View Law Group. He offers advice on debt related issues.

Photo by Ahmed Amir

Do you hate budgeting?

I think most regular people truly hate the thought of creating and maintaining a personal finance budget.

In fact, if you put it on a list, I bet it would rank right up there with brussel sprouts and getting poked in the eye.

Personally, I’m a big believer in budgeting.  I think it is an essential tool for reducing the stress and anxiety often associated with our finances.  However, I didn’t always feel this way so, I can certainly relate if you have some reluctance.

I know firsthand the reasons we hate budgets because I used to hate them myself.  Fortunately, I’ve given it a shot and found that a budget isn’t as bad a thing as I thought it would be.  Hopefully, I can encourage you to give it a try too.

The 10 Reasons We Hate Budgets

Why do you hate the idea of living on a budget?  Is it based on some past experience or just preconceived notions?  I’m betting one or more of the items on the list below accounts for a good portion of the resistance you feel toward creating a budget.

Let’s get some of the objections out in the open and talk about them a little.  Maybe this will help you to overcome your objection to budgeting.

1.  We don’t want to be held accountable

I think this is a biggie.  I know it was for me.  I didn’t want someone standing over me with a club whacking me on the head every time I was a little impulsive.  I didn’t want anyone telling me what to do with my money.

I think there are two remedies for this.  One, put yourself in charge of the budget.  This gives you a better feeling of control.  Two, build a personal slush fund into your plan.  Set aside a specific amount each month that is your discretionary money to do with whatever you want.  This way you won’t feel so constrained.

2.  We are living in denial

Ignorance is bliss.  Without a budget, no one really knows how much money we are wasting.  Sure, everyone in the family knows we have money problems, but no one knows why.  No one can justify shutting off the cable or avoiding the mall or staying away from Starbucks because no one really has their finger on where the money is going.  Confronted with the truth, we might have to take actions we don’t want to take so let’s just not go there, okay?

Unfortunately, when we are embracing denial, it normally takes what I call a day of reckoning to get us to face the music.  Someone loses their job or someone gets sick or we get a foreclosure notice.  Something big happens that makes the mess unavoidable and undeniable.  We are backed into a corner with no other way out, but to address the issue.

I’d encourage you to overcome your denial on your own terms.  A day of reckoning isn’t pretty and things are usually so messed up that it is very difficult to recover.

3.  We don’t know how to get started

I’ll admit that starting a budget can be a bit intimidating if you’ve never done it before.  There seems to be a lot to figure out.  There are questions like, what method of budgeting should I use?  What software should I buy?  What spending categories should I setup?

Don’t let this stop you from getting started.  Budgeting is just like everything else.  You might not be the best at it when you are a beginner, but that’s okay.  It doesn’t have to be perfect.  You’ll learn what you need to know along the way and in the process, you will start putting your money to work toward your real priorities.  You can always make changes later.  They key is to just jump off as soon as possible.  Also, be sure to check the end of this article for several resources that can help.

4.  We think it will be too much work

I won’t kid you.  It does take some effort to create and maintain a budget.  However, if your budget is too much work, then you are doing something wrong.  I spend about 1 to 2 hours per month maintaining my budget.  That’s not much time for such a high-leverage activity.  It will take you a little longer when you first get started, but with all the technology available today, budgeting is very easy.

I recommend a system like YNAB (what I use) or Mint.com.  These systems can help you get up and running in no time and they make most of the really tedious work a cinch.  Don’t just go with what is free or what your brother-in-law uses.  Find the system that fits your personality and use that one even if it costs you a little money.  It will be the best investment you’ve ever made.

5.  We don’t make enough to need a budget

Some people seem to think that you only need a budget if you make a lot of money.  After all, what’s the point in creating a budget when there is no money to do anything with?  Well, I think these people are way off the mark.  It doesn’t matter how much or how little you make.  You need a budget.

A budget is a way to tell every last cent you make exactly what you want it to do for you.  This ensures you get the most out of whatever income you bring home.  It’s okay if you want a percentage of your money to go towards building your collection of exotic back scratchers.  It’s your money.  Do with it whatever you like, but squeeze every last ounce out of it by using a budget to prioritize your spending.

6.  We tried budgeting before and it didn’t work

It takes a little time to get the hang of budgeting.  After all, it is something totally new and foreign to most of us.  I think a lot of people give up too soon.  They start, totally blow their budget the first month and then give up.  After such an experience, they write budgeting off as something that doesn’t work.

Give it another chance and commit to it for at least three months.  By the end of the third month, if you are really serious about it, you’ll likely have the hang of it or at least be well on your way.  Following your own budget plan is a big behavioral change.  You have to be patient with yourself and allow time to adapt.  Budgeting definitely works.  You just have to train yourself to work your budget.

7.  We want what we want and we want it now

This is the main reason that we overspend and have piles of debt.  We have lost the ability to postpone our gratification until we have saved enough to pay cash for what we want.  The kicker is that what we buy doesn’t usually make us happy anyway.  Oh, it might give us a high for a couple of hours, days or weeks, but in the end we are right back where we started only with one more creditor calling us.

We need to get control of ourselves.  We need to examine our real priorities.  Ask yourself, “What do I really want?”  What is most important to you?  Is it all the stuff you are accumulating or true peace and happiness?  A budget is a discipline that can produce true peace and happiness.  You may have to deny yourself at first, but in the end, it is a path to what you really want.

8.  We always get in a fight when we talk about money

Money is often the source of big fights in marriages.  It has certainly caused a few disagreements in my home.  However, just ignoring money is no way to solve the issue.  In fact, it is only going to make things worse over time.  Yes, getting on and sticking to a budget can be a little nerve-wracking at first, but it will lead you to a better place.

I really like the suggestions that Brad offers in Marriage And Money: How To Improve Communication And Minimize Money Fights.  He’s lived through the worst of creating change in his marriage and lived to tell about it.  I think you’ll find his story encouraging and helpful.

9.  We don’t want the limits a budget imposes

A budget does create some guidelines.  It creates boundaries, but so does a pile of debt.  A budget you control.  Debt controls you.  When your spending is overboard, you are voluntarily handing control of your life to other people.  You are willfully entering into a contract to work for Discover or Visa or American Express or Mastercard until that debt is paid off.  Is that Frappuccino really worth it?

The limits a budget imposes are voluntary, self-imposed limits.  You are making the decisions.  If you’ve gotten yourself in over your head financially, then you know that once you are in this situation, you have no control.  You have a lot of limits, but no say in how things play out in your life.  It is scary, depressing and very stressful.  A budget is a tool to undo such a mess.  The limits it imposes are good limits.  Embrace them.

10. We think it will make us look poor

Dave Ramsey says that normal is broke.  It is funny that people that often look rich don’t have a dime to their name.  Generally, they owe way more than they can ever pay back.  Scaling back your spending will make you look weird.  That is true, but after a brief adjustment period, you’ll know it was the best thing you ever did for yourself and your family.

True wealth comes from saving and building net worth.  It comes from making wise financial decisions.  A budget helps you to do just that.  It gives you a way to direct your money instead of just letting it drain out the bottom of your checking account.  You may look a little poor at first, but a budget will take you down the road to real wealth.  Which would you rather have?  The appearance of riches or true riches?

Learn to Stop Hating Budgets

We often hate what we don’t really understand.  This is so very true with budgeting.  It isn’t a club to beat yourself or your family over the head with.  It is a compass that guides you to greener pastures.  Here are a few resources to help you learn to stop hating budgets and to get you started down the path to success:

• Back To Basics: 79+ Brilliant Budgeting Resources You’ll Love
• Envelope Budgeting System
• If Budgeting Isn’t Fun, You’re Doing It Wrong
• A Review of Mint.com – Online Budget Tool
• Budgeting: The Most Important Thing You Can Do With Your Money

Photo by *Zara

Spending less than you earn is the only way to get ahead with money.  If you are one of those people that finds there is always more month left at the end of the money, then keep reading.

I found some very powerful ideas for living below your means that I want to pass along.  Making significant changes to our lifestyle takes time and effort.  It also takes broadening our minds.

Many of us, including me, often get stuck doing things the same old way.  We seem to develop mental blinders that keep us from even seeing other possibilities.  That’s why I went in search of some really great ways to save and manage money.

I want to help you and me find new ways to pinch a few pennies.  Saving a little here and a little there is how you’ll whittle down your spending until you are living below your means.

Powerful Ideas for Living Below Your Means

Sometimes we think we are doing everything possible to squeeze every dime out of our budgets when in reality there is so much more that we could be doing.  We just need a little help expanding our ideas of what is possible and seeing new areas to focus our efforts.

Here are some powerful ideas to help you live below your means:

1.  Begin by Clarifying Your Purpose

Why do you want to start spending less?  It is very important to clarify your purpose.  If you can identify a higher reason, it will make things a lot easier.   For instance, one of the big reasons that my wife and I wanted to become debt free was so we would have more money available to give to charities, family and people we know in need.  This became a real motivator for us.  Getting the 20-ton gorilla off our back, freed us up to use our money for the things that really mattered to us.

As Ron points out very powerfully in Monitoring Your Money Isn’t The Same As Budgeting Your Money, you need to align your money with your values.  This is a crucial first step in achieving real success at living below your means.

2.  Believe It Is Possible

I think many people have lost hope in their financial situation.  They are overwhelmed and feel they have no one to turn to for help.  This seems to be the case for Arlin, one of Brad’s readers over at Enemy of Debt.  In Feeling Like You Are Bankrupt, Is Different Than Actually Being Bankrupt, Brad spells out for Arlin many very positive steps he can take to start digging out of his financial mess.  He encourages his reader to reach a little further and to dig a little deeper for solutions other than bankruptcy which is really no solution at all because it has a ton of its own issues.

Just like Arlin, you may feel like you’ve very nearly reached the end of your rope.  Well, please don’t give up!  You’ve really got to believe that it is possible to turn your financial ship around.  If this is you, then I’d highly suggest that you pick up a copy of Dave Ramsey’s The Total Money Makeover.  It will lay out a plan that will restore your hope and it will encourage you along the way!

3.  Be Methodical in Your Approach

You’ve got to have a well thought out and logical plan for how you’re going to start living below your means.  All change requires a plan.  I really like the plan that Tiffany, a newly single mom, came up with in her article for ptMoney called The Plan: Making Every Dollar Count.  She is very methodical in her approach and has analyzed her situation very carefully.  This significantly increases her chance of success.  You can customize Tiffany’s plan for yourself.

When the crap hits the proverbial fan, it is easy to run off with your hair on fire making all kinds of rash financial decisions that may or may not lead to better results.  I’d highly recommend taking a deep breath, finding a rational voice of reason and formulating a sound plan instead.  Be methodical in your approach and you will see greater results!

4.  Leave No Stone Unturned

What ways of cutting back haven’t you examined?  Sometimes we feel we’ve cut absolutely everything possible to cut.  However, that’s rarely the case.  Most of us have a bunch of fat in our budgets that we simply do not see.  Take for instance, your daily commute to and from work.  Ramsay wrote an article for FrugalDad where he examines the Costs of Commuting, and Nine Ways To Reduce Them.  It is a brilliant example of leaving no stone unturned.

You’ve really got to track your spending and put everything out on the table in order to make this work.  Nothing should be considered sacred and every dollar you spend should have a specific purpose.

5.  Stretch Until You Think You’ll Snap

When you’ve pushed it as far as you think you can, push a little further.  Be sure you squeeze that last little drop out of your budget so you are getting the absolute most out of your money.  If it ain’t hurtin’ a little, then you are NOT stretching yourself far enough! 

Want some ideas for how to be a little more frugal?  I suggest you check out 9 Tips to Stretch the Life of Common Household Items at My Dollar Plan.  Can you really make a bra last over 6 years?  Are you properly maintaining your vacuum cleaner?  This is where the rubber meets the road!

6.  Spend When You Need To

Okay, if you’ve followed some of the links that I’ve provided, then you’ve covered a lot of ground on how to save money on expenses.  However, it is also important to know when to spend money.  Trent over at The Simple Dollar addresses this very nicely in his response to a reader’s question about When Living Cheap Catches Up With You.

Sometimes it is necessary to replace things that are broken, worn out or no longer usable.  There is no reason to feel guilty about this!  Be realistic about it, life takes money.  My best advice is to pay cash for whatever you buy.  This requires that you anticipate your needs and carefully save for the purchase.  You’ll thank yourself later!

What ideas have you found useful for living below your means?  Leave a comment so we can all benefit!

Photo by Shawn Allen

A balanced budget is essential to great money management.  It puts you back in the driver seat giving you control of where your money goes and what it gets spent on. 

Wouldn’t it feel nice to be in control again?  It will certainly lower your stress and help you sleep better at night.

You can get there!  It really isn’t that hard or painful.  Chances are you’ve developed some bad money habits over the years and just need a simple plan to get you back on track.

5 Simple Steps to Balance My Budget

Here are five simple steps to help you get your budget under control in no time at all:

1.  Determine Your Exact Income

You need to know exactly what you have coming in to balance your budget.  It is generally best to manage your money on a monthly basis.  So, start making a list of the various sources of money that you have to determine your total monthly income.  For some, this might be a very short list because you only have one source of income and that is your paycheck.  For others, you might have several streams flowing in from things like freelancing, alimony, child support, dividend checks and business ventures.

Make sure you don’t miss any income source.  Once you’ve got a complete list written down, then sum it up to determine your exact income.  This is the size of the hammer you have to work with to balance your budget.

2.  Track Your Spending

Okay, so now you know exactly how much money you have coming in each month, but where is it all going?  You need to take a month to track every single penny you spend.  You must determine where all your money is going.  This is an eye-opening experience.  You will likely be surprised and shocked at how much is being spent on things that don’t seem all that important.  Tracking your spending is a little arduous and most people won’t do it, but that’s why they stay broke.

This is a big step toward putting yourself back in the driver seat with your money.  You’ll be gathering the information you need to make smarter decisions about where you spend what you make.  Don’t you work too hard for your income to simply let it slip through your fingers?

3.  Determine Your Priorities

After tracking your spending for a month, compare your outflow of money to your total income.  Are you spending more than you earn?  It is likely that you are.  This means that every month your are sinking deeper in debt and moving further away from a peaceful night’s sleep.  You need to make some decisions to balance your budget.  You have to set the right priorities for your spending.

What jumps out at you from your log of spending over the last month?  What amount seems totally out of control?  Resolve to cut way back in the areas that are unnecessary so you start spending less than you earn.  This might seem impossible at first, but with just a little sacrifice it can be done.  Take a look at this list of 20 ways to cut spending and these 50 ideas to legitimately increase your income for some inspiration that will help you balance your budget.

4.  Develop a Clear Budget Plan

You’ll want to adjust your money habits on a monthly basis to conform to your new priorities.  The best way to do this over the long-haul is to start a monthly budget.  A budget is a plan you create at the beginning of the month that tells your money exactly what you want it to do for you over the next 30 days.  It is a tool you can use to keep yourself on track.  If you are married, then you both need to agree on the budget before the month begins for it to be successful.

Living on a budget is not as scary as it seems.  In fact, it greatly simplifies your life and reduces your stress because it puts you back in control!  Don’t resist budgeting any longer.  Your budget will become your new best friend if you will let it.

5.  Make Adjustments

You have to remain flexible because a rigid budget will die a quick death.  Life is not always predictable and people are not always logical.  Your budget needs to take both of these facts into account.  You are going to make spending mistakes especially at first.  It takes time to incorporate radical change into you life.  Don’t make excuses for poor decisions, but don’t beat yourself up either.  Resolve to do better next time.  In a few months, if you stay flexible, you will have balanced your budget and you will be feeling much better about yourself.

Be willing to make the adjustments necessary to make your budget work.  It may not be perfect in your eyes, but a slightly compromised budget that everyone agrees to is way better than no budget at all.

Great Money Management Is Within Your Reach

What small step are you going to take today to start getting your budget under control?  Don’t delay another minute!  You don’t have to swallow the whole pill in one sitting, but taking one little baby step right this instant will empower you and give you the confidence you need to change your life.  You’ll thank yourself later!

Photo by penywise

The money in our life is important to us.  It pays for our food, shelter, necessities and luxuries.  However, despite its importance, we often poorly manage it.  We fail to get the most from what we make.

Now is a great time to improve the way we handle our money.  There is never a better time than the present to make the necessary changes.  If you have money issues, then continuing down the road you are on is only going to dig you deeper into the hole.

It is time to revisit and apply some personal finance basics to the money in our life.

5 Ways We Can Better Handle the Money in Our Life

Being more successful with money is not hard and the advice I’m offering here probably isn’t anything you haven’t heard before in one place or another.  Improving how we handle money is a lot like improving our health.  We know what we should be doing.  The tricky part is to actually apply the principles we know in our everyday lives.

I’m reviewing these personal finance basics now in hopes that this will be the year that you’ll resolve to take action.  Here are five ways we can better handle the money in our life:

1.  Get Over Your Resistance to Being Held Accountable

Dave Ramsey says that 80% of winning with money is emotional and only 20% is head knowledge.  I believe him.  As Ron points out in The Top 5 Personal Finance Resolutions, you’ve got to get control of your emotions when it comes to money and act logically.

A big part of the hump you have to get over emotionally is allowing yourself to be held accountable for your spending.  This first step is really a doozy!  Most of us don’t want anyone telling us what to do.  We want to do whatever we want, whenever we want.  However, this is exactly the behavior that has gotten us into our financial mess.  You’ve got to conquer your own emotions about money before you’ll make any real progress.  Will you resolve to do this?

2.  Start Paying Cash for Everything

The truth is we spend more money when we pay for things with credit cards.  Cutting up our credit cards and paying only cash for the items we buy will help us to start living within our means.  It is going to be painful at first, but it will be worth it.  Check out some suggestions on how to make this transition in New Year’s Financial Resolutions: Resolve to Take Baby Steps.

Piling up more debt is unacceptable.  It will only make the mountain we have to climb to improve our finances that much larger.  You’ve got to cut the problem off at the root to get control and paying cash is one of the best ways to do this.  Again, it won’t necessarily be easy, but it will turn your life around.

3.  Create a Budget to Get Control

One of the most basics of basics in personal finances is to have a written budget.  A budget allows you to plan in advance each month exactly where you want to spend your money.  This keeps you from coming up short.  A budget will also give you insight into where money is slipping through your fingers.  Stopping this leakage is crucial to turning your financial life around.

Check out 31 Days of Organizing for a Better 2010: Create a Budget for some great advice on how to get started.  If you have a computer, then I highly recommend maintaining your budget electronically.  It just makes things much easier.  Personally, I use YNAB as my budgeting system and I love it.

4.  Set Some Measurable Financial Goals

You are going to need some motivation to spur you on to success with your money.  The best way I know to get enthused about a task is to imagine what it is going to be like when things are done.  In other words, set yourself some goals for for what you want to accomplish and write them down.  Detail out exactly what you want to accomplish with your efforts.

You’ll find some great example goals in My 2010 Comprehensive List Of New Years Resolutions.  Notice that these goals are very specific, measurable and realistic.  This is important.  You want to be very clear about what you are aiming toward and have a good chance of reaching the objective.  This will aid you in measuring your progress and keep you from losing hope.

5.  Start Saving for the Future

Once you start to get a little traction with your money, then you need to start saving.  You want to sock back money for things you know you’ll need a chunk of money for in the future.  This includes things like retirement, the kid’s college fund and next Christmas.  This type of basic financial planning will ensure your needs are well met going forward.

It is never too early to start saving!  The sooner the better because you want your money to start working for you as early as possible to earn its maximum potential.  A great example of this concept is explained in Delaying Roth IRA Contributions One Year Could Cost You $74,000.  Don’t miss the opportunity to live like a king by delaying getting started!

Personal Finance Basics Will Revolutionize Your Life

These really are some of the most essential basics to winning with your personal finances.  Also, I can assure you that if you will apply them that you will revolutionize your life.  How do I know?  Because I’ve done it myself.  I was skeptical at first, but I can tell you that I’m a believer now.  There is more you need to know, but that will come with time.  Concentrate for now on the basics and you’ll make incredible headway!

What suggestions would you offer to someone that wants to do better with their money?

Photo by Kevin

Money is the fuel of life.  No matter how much or how little you earn, no matter how much or how little you need to live your chosen lifestyle, getting the most of out of your money is smart living.

It takes money to do just about anything.  Good financial management will give you more options and freedom to live the life of your choice.  This is living life to the fullest!

3 smart living techniques for getting the most out of your money

Getting control of your money to make it do what you want is not all that hard.  In fact, it is amazingly simple, yet not always easy to do. 

Winning with money is 80% behavior and 20% head knowledge.  You do not have to be a financial guru which is good news for me.  However, you do have to decide to reel in your bad money habits which can be a difficult thing to do.

Dave Ramsey says, “You have to get sick and tired of being sick and tired” before you’re going to choose to change.  I believe this is true. 

If you are fed up with barely getting by one month to the next, then you might be ready to implement what I believe are the three most important techniques for getting the most out of your money.

1.  Get control of your money with a budget

You have got to be willing to get control of your money to get the most out of it.  A budget is not a hammer used to bang yourself and your family over the head for bad behavior.  It is a tool that allows you to align your spending with your family’s priorities.

A good budgeting system tells your money what you want it to do in advance every month.  It focuses your resources toward the goals that you set.  The key is to get everyone to agree to the plan up front to avoid conflicts.

Another purpose of a budget is to help you start spending less than you earn.  You cannot live life to the fullest while you are buried in debt, but we’ll talk more about that in a moment.

A budgeting system will help you plan for the expected and the unexpected expenses of life.  It gives you a way to start saving money for specific purposes like Christmas presents, a college education, a busted water heater and car repairs.

Finally, a budget provides you a feedback loop to let you know whether you are actually spending according to your plan.  This is indispensable.  This ongoing process will whip your finances into shape in no time!

2.  Get out of debt to give yourself more freedom

I am a firm believer in living without debt.  I know some people feel differently, but this is the choice my wife and I have made for our family.  We think it is smart living.  Let me explain why we feel this way.

First, by being debt-free, we have reduced our risk.  If we lost our income unexpectedly for any reason, we could still survive for several months because our monthly expenses are relatively low. 

With the monthly payments that come with debt, many people are spending every dime they earn and would soon be in big financial trouble should they experience even a significant reduction in income.  It happens way too frequently!

Second, we believe that the borrower is slave to the lender.  Less debt means fewer commitments.  This opens us up to the opportunities life presents us.

Freedom from debt has created margin in our finances.  We have money to give and to help others.  We can also use the power of cash to get some really great deals!

Overall, a debt-free life is just simpler and cleaner.  It offers a higher quality of life with less stress and more freedom which in our opinion is smart living!

3.  Get started investing so your money can work for you

Once you are living on a budget and have paid off your debt, then it is time to start investing so your money can grow.  This is the way to build wealth and prepare for the future.

Investing wisely means putting your money in long-term investments that have a solid track record of success.  There are many reasons to do this, but let me mention a couple of the bigger reasons here.

First, someday you are going to want to do things that require big piles of cash.  I’m mainly talking about things like sending one or more kids to college and retiring from full-time work.  The only way to do these things with dignity and without accumulating more debt is by investing wisely.

Second, getting your money working for you magnifies and perpetuates your financial success.  The sooner you begin, the bigger and better your nest egg will be.  This means the sooner you’ll be able to shed things holding you back from living life to the fullest!

Investing is a fundamental practice for getting the most out of your money!

Assignments: Start getting the most out of your money

“The best time to plant a tree is twenty years ago. The second best time is now.”
~ African Proverb

Again, starting to get the most out of your money is pretty simple.  It just takes a little effort on your part.  If you’ll do these things, then I think you’ll be amazed at how fast it all begins to improve your life.

Here are the assignments for this rule to help you get started:

1. Believe it is possible – The first thing to do is convince yourself that it is possible for you to live on a budget, pay off your debt and start investing.  This is likely the biggest hurdle you have to overcome.  It was for me, but now I am living testimony that it works.  The best suggestion I have for you in this regard is to start listening to Dave Ramsey’s radio show.  You will hear great advice and you’ll also be encouraged by the stories of those that are winning with money!
   
2. Start your budget – I believe the best method for budgeting your money is the envelope system.  I highly recommend purchasing YNAB Pro to help you get organized.  I also offer you the following articles for more information on how to get started with your budget.

   Things I Learned Living on a Budget – Part 1, Part 2 & Part 3
   Back To Basics- 79+ Brilliant Budgeting Resources You’ll Love
   How To Avoid Buying Things You Do Not Need!
   

3. Begin paying off your debt – Many people have successfully used the debt snowball technique to pay off their debt.  This is the best method that I have run across.  It works much faster than you think.  My wife and I paid off $28,000 in debt in about 20 months!  My article Getting Debt-Free Using The Debt Snowball Technique explains exactly how to set up and manage your debt snowball.

Smart living requires you to get the most out of your money

Using your money wisely will help you live life to the fullest!  It will relieve you of a lot of stress and give you so much more freedom to do the things you really enjoy!  This is truly a big step toward smart living.

Follow this link to discover all the rules for Smart Living.

Photo by Jbangelo

Most of us have some bad money habits that continued could leave us eating ALPO for dinner!  If not literally, then certainly figuratively. 

Dogs might love ALPO and we might survive eating it, but it won’t be pleasant.  Shape up or you could wind up broke and desperate!

Check out this list to see if you have any bad money habits that you need to break!

1.  Struggling to keep up with the Joneses

Comparing yourself to your neighbor is a very common bad habit and trying to keep up with their lifestyle is a trap that will suck your finances dry.  Be your own person and decide for yourself what makes you happy!

2.  Shopping for groceries on an empty stomach

A big chunk of our income goes toward groceries.  When you are hungry, everything in the store looks appetizing.  Be sure to eat something just before you go grocery shopping this will help cut back on the food bill and possibly your waistline more than you can imagine.

3.  Leaving the lights on 24×7

Dads across the country ask, “Are we paying the electric company’s Christmas bonus this year?!?”  Turn off the lights when they aren’t in use.  It will reduce your power bill and it is good for the environment!

4.  Buying every book you read

I check out most of the books I read from the library.  This not only saves me money, but it also eliminates the need to store all those books.  After all, how many do you actually read more than once?

5.  Failing to consider TCO when making a purchase

TCO stands for “Total Cost of Ownership”.  Many items require us to pay upkeep, storage and usage fees.  Pools, boats, RVs, hot tubs and other luxuries often fall into this category.

6.  Saving too little

Planning for the future is important.  However, many of us catch the “I gotta have it now” attitude.  We then come up short when buying a home, paying for college or retiring.  Saving too little is a bad habit for many people!

7.  Renting or leasing everything long-term

When you rent or lease everything, you don’t build any equity.  Your money just disappears, never to be seen again.  Instead, use your money wisely to buy assets that retain value.  A home is a good example and now is a great time to buy!

8.  Following the crowd when investing in the stock market

Many people tend to get caught up in the hype about the stock market.  When market news is good, they buy.  When market news is bad, they sell.  Generally, this leads to buying high and selling low.  Not a good strategy!

9.  Buying stock in a single company on a hot tip

How many of you have lost money on this one?  I know I have.  Doing this habitually will cost you a lot of money.  A long-term, diversified portfolio is a much better strategy!

10.  Making a daily weekly visit to the mall

You may not buy something every time you visit the mall, but occasional purchases still add up.  Stay away from the places that lead you to spend more than you should.  Stop the catalogs and mall visits and you will save money!

11.  Owning more shoes than you could wear in a month

Comfortable footwear is a must, but how many pairs do you really need?  Many of us have a different pair of shoes for every possible occasion.

12.  Eating out too often

This has got to be my Achilles heel when it comes to finances.  I love eating out!  Of course, restaurants are expensive and if you go out all the time especially to fancy places, then you are throwing money down the drain.

13.  Buying a new car every couple of years

New cars depreciate 20-30% the first two years of ownership!  Why take this kind of a financial hit?  Buy a good vehicle that is two years old and keep it until it wears out.  Trading cars all the time is definitely a bad money habit.

14.  Using payday loans to make ends meet

Payday loans are notoriously bad.  The interest rate can easily be 200-400% APR!  You can quickly get yourself in a payday loan sinkhole that is practically impossible to escape.  Don’t start this habit if you haven’t already!

15.  Smoking

In 2009, the average cost of a pack of cigarettes rose to nearly $9.00!  An ex-pack-a-day-smoker could invest this money at 8% interest and have about $50,000 in 10 years or $160,000 in 20 years.

16.  Drinking a latte every morning

It is easy to get down on smokers, but what about you?  Do you stop and have a latte every morning on your way to work?  Saving just $4 per day could net you over $20,000 in 10 years!  Habits can cost you more than you think!

17.  Thinking 90 days really is the same as cash

Retailers wouldn’t offer this so often if they didn’t make money doing it.  If you are late even one day paying off this charge, then you will likely owe back interest on the full amount!  The perils of 90-days same as cash plans aren’t worth it!

18.  Charging everything to your credit card

Some find it more convenient to use a credit card for all their purchases.  Well, with interest and late fees you generally wind up paying more by using plastic over cash.  In addition, it is psychologically easier to whip out a card to buy things than it is to use hard-earned cash!

19.  Borrowing against your 401k

There are a number of reasons that borrowing from your 401k is a bad idea.  Mainly, you are robbing your future to pay for your present circumstances.  This will leave you poor!  Doing this repeatedly is a terrible habit that will come back to haunt you.

20.  Cranking the heat and air at your residence

We all like being comfortable, but it is more economical to be very conservative when setting the thermostat.  You can do all kinds of things to stay cool this summer besides just sitting in the A/C.  Be creative and save yourself some dough!

21.  Playing the lottery

In my humble opinion, the lottery is just a voluntary tax on the poor, but I won’t go there.  The odds of winning are so low that this is like throwing money in the trash.  Invest this money wisely and you might truly have a fortune some day!

22.  Paying too much

There are all kinds of ways and reasons that we pay too much for stuff.  Sometimes it’s because we want the latest and greatest or because we “need” a designer label.  Never pay retail and always look for a bargain.  This habit will save you tons over a lifetime!

23.  Being late with payments

Some of us are just never on time for anything.  However, paying your bills late is not a luxury you can afford.  Late fees add up fast!  Try online bill pay or some other technique, but be sure you pay what you owe when you owe it.

24.  Investing in things you don’t understand

Never, never, never put your money in something you don’t fully understand.  When you do, you are like a lamb being led to the slaughter.  Sorry to be so graphic, but it is time to wake up!  Get-rich-quick doesn’t work.  Don’t fall for it!  Take the safe route and you’ll be ahead.

25.  Visiting your local casino every week

Casinos are in business to make money, not give it away.  So, no matter how hard they try to convince you otherwise keep your money in your pocket.  Going to a casino regularly means that you are going to lose your money.  It is that plain and simple.

26.  Pawning or hawking items at a pawn shop

You can either sell items to pawn shops which is called hawking or you can borrow money using your item as collateral which is called pawning.  Either way, you are losing money.  Doing this regularly will cost you a bundle.  Avoid pawn shops unless you are buying!

27.  Making impulse buys

Do you go out shopping without knowing what you are going to buy before you leave the house?  If so, then you are looking for an impulse buy.  Most people live in denial about this and trick themselves into thinking  they got a “good deal”.  Buying things you don’t need is not frugal.  Staying home will truly save you money.

28.  Failing to try before you buy

I’m a big fan of trying something before you buy it.  This has helped me numerous times to avoid buyer’s remorse.  Yes, it may cost you a little to try something first, but this can save you hundreds down the road.

29.  Signing up for debt consolidation

People usually want to consolidate their debt when they have too much to afford the monthly payments.  Debt consolidation usually offers a lower monthly payment, but without a change in behavior most folks wind up deeper in debt than when they started.

30.  Relying on one income stream

What if your one source of income dries up?  What will you do then to stay afloat?  This is when many start developing some of the other bad habits on this list like using credit cards, payday loans and pawning items.  Develop multiple streams of income!

31.  Letting the government hold your money

Many of us are so afraid of owing some taxes on April 15th that we let the government take too much out of our checks.  If you get a big tax refund every year, then you need to adjust your withholdings.  You are just letting Uncle Sam use your money for free.

32.  Bouncing checks

Overdrawing your checking account will cost you big time in overdraft fees and service charges.  There is really no excuse for this with the widespread availability of online checking and budgeting systems.

33.  Buying extended warranties

You can always find someone that was glad they bought the extended warranty, but for each of these there are a thousand people that gained no benefit from the extra cost.  This is exactly what the warranty provider banks on.  Skip the extended warranty and save the difference!

34.  Overbuying gifts

I’m a generous guy.  I really am, but some people just go way overboard especially at Christmas.  Are you really doing the right thing for your family if every year you bury yourself deeper in debt?  Sensible gift-giving is the loving thing to do.

35.  Using your emergency fund unwisely

An emergency fund is for when the truly unexpected happens.  It is not for new tires, Christmas gifts or car repairs.  These are all things you should be including in your budget.  Your emergency fund is there for when you lose your job or get sick.  Using it unwisely will leave it depleted for when a true emergency pops up.

36.  Neglecting preventive maintenance tasks

Most assets need some form of preventive maintenance to keep them in top shape.  This is true of your home, car and appliances for example.  Neglecting to do this properly will cost you more in the long run.

37.  Refusing to negotiate

You can often stretch your dollars further by negotiating a better deal.  However, some people are afraid to ask.  I recently got 5% knocked off a large car repair just by asking.  It wasn’t much, but every little bit helps.

38.  Spending a dime to save a penny

Sometimes, if we aren’t careful, we can waste money trying to save money.  I’ve done this more than once with home-improvement projects.  I try to do it cheap and wind up having to redo the whole thing over the right way.  This jacks my cost up even more than expected.

39.  Buying things you don’t use

Be honest.  How many of you have a gym membership or piece of exercise equipment that you don’t use?  Why waste the money?  Stop the bleeding by refusing to continue buying things that you won’t use!

40.  Buying too soon

Technology gadgets are notoriously expensive when they are first introduced.  You can often save a bundle if you wait awhile before making such a purchase.  If you are in the habit of buying things when they are hot, then learn to chill a bit.

41.  Buying too late

Procrastination can force you into paying more for items you need.  When you notice something you’ve been saving to buy is on sale, make your move.  Waiting may lead you to miss the deal.  Be prepared and take decisive action!

42.  Acquiring too much of what depreciates

Things like cars, boats, furniture and decorations lose value fast.  These are usually things we want to impress the neighbors.  However, they have little to do with true wealth.  Buying too much of this stuff will leave you poor and disillusioned.

43.  Being too generous

Loaning or giving money to every person with a sad story will usually make you one of them.  I’m a big fan of donating to worthy causes, but be smart about how you give your money.  There is nothing wrong with checking out a story before giving to it.

44.  Being too selfish

Greedy people often find themselves in a financial ditch.  Making money the most important thing in your life is not a good strategy for living life to the fullest.  Yes, money opens many doors, but selfishness closes far more.

45.  Allowing yourself to be pressured

Don’t buy things because a salesman is pushing you to do so.  In fact, pressure should be a red flag to you that something isn’t right.  Walk out of any deal where you feel pressure to rush into something.  Legitimate deals can almost always wait overnight.

46.  Failing to ask for a raise

Ask for more money at work and they might surprise you by giving it to you.  You won’t know for sure until you ask.  Every employer wants to keep salary expense to a minimum, but they also want to keep good help.  If you haven’t had a raise in awhile, ask for one!

47.  Ignoring your credit history

In today’s world, you must monitor your credit history to avoid identity theft.  Checking your credit report a few times a year will help ensure nothing fishy is happening.  It may also help you catch and correct errors before they cause problems.

48.  Following the advice of broke people

Who’s financial advice are you following?  What is their net worth?  It is easy to go with the prevailing financial wind, but this often leads you to where everyone else is at — the poor house!  Make sure your advisor knows what he or she is talking about.

49.  Neglecting the march of time

Time does not stand still.  You will one day need a newer car, your kids will eventually go to college and one day, sooner than you think, it will be time for you to retire.  Are you financially prepared for these events?  Ignoring them will not make them go away!

50.  Refusing to live on a budget

Budgets get a bad rap.  Most people feel like they are too restrictive.  It doesn’t have to be that way.  Failing to plan how you want to use your money is probably the #1 bad money habit people need to overcome.  Give budgeting a try and you might be pleasantly surprised with what it can do for you!

Bad money habits don’t have to last a lifetime!

Recognize yourself in this list of bad money habits?  It is never too late to change!  I invite you to browse around my site for more tips, click one of the links in this article to visit some of my favorite sites and check out my recommended financial book reading list.

What habit strikes closest to home for you?  Leave a comment and let me know!

Photos by Leonid Mamchenkov and rafeejewell

I also think that a return to the basics is a great way to create a good life.  In many instances, we have overcomplicated our lives causing unnecessary stress, anxiety and tension.  We should take this opportunity to scale back and simplify.

How to create a good life with back to basics living

There are numerous things we can do to get back to the basics.  All these moves will help us to incrementally improve our lives. 

They will cut out many of the unneeded things that clutter our lives robbing us of our peace and sanity.  In addition, they will help create order and stability where it is badly needed.

Let’s take a look at some steps for getting back to the basics!  By the way, I have sprinkled links throughout this article to help you find more information on each step.

1.  Cut out everything but what you really love, use and enjoy.

It is time to do an honest appraisal of all the stuff cluttering up your life and your finances.  Take an inventory of all your activities and possessions.  Get rid of everything that causes you even an ounce of stress.  If you aren’t using and enjoying it, then sell it, donate it or trash it!

2.  Evaluate your stuff and activities based on three factors.

When you are trying to decide whether to keep something in your life or get rid of it, evaluate these three things:

• Does it demand too much of your money?
• Does it demand too much of your time?
• Does it add enough value to your life to keep it?

Generally, your initial reaction or gut instinct is the best action to take.  Don’t deliberate too long.  Err on the side of back to basics living!

3.  Reacquaint yourself with the joy of simpler living.

It is likely that there was a time when you lived a much simpler life than what you have now.  You were less busy, had fewer responsibilities and your life wasn’t cluttered with so much stuff.  Chances are you were just as happy or happier then than you are now.  Why not seek pleasure and satisfaction in the simple joys of life again?  Take this opportunity to explore if you can be happy with less.

4.  Organize your personal finances with a budget.

How much money do you really need to survive and create a good life?  Where does all your money go every month?  A budget will help you answer these questions.  It will return a sense of control to your finances that you may not have experienced in quite some time.  Living on a budget is liberating and will reduce stress.  Need help getting started?  Check out this list of brilliant budgeting resources!

5.  Stop buying things you do not need and pay off your debt!

We need to differentiate more clearly between our wants and our necessities.  We seem to get confused.  I’ve been guilty of this.  I’ll be the first to admit that I’ve struggled with how to stop buying things I don’t need.  Over time, I’ve had to retrain myself.  As a result, my wife and I have frugaled up our finances and paid off our debt.  Being debt-free is awesome!  I now believe that being debt-free is the path to financial success!

6.  Be more content with what you already have.

We often become discontent when we compare ourselves to others.  We see other people that seem to have more than we do and we start thinking we need more.  However, more is usually what robs us of the very happiness we seek.  It steals our joy and makes us a prisoner to debt and obligation.

7.  Focus your time on significant activities.

A great deal of happiness in life often comes from the knowledge that you are  spending your time on things that have purpose and meaning.  It isn’t always about the bling!  In fact, many of the people that report the highest levels of happiness often have very little in terms of material possessions.  However, they do spend a lot of time with family and friends.  They invest themselves in relationships.  Focus on creating significance in your life!

8.  Take care of your mind and body.

You can’t truly have a good life without good health.  It is paramount that we take care of ourselves.  This means eating the right foods and getting some exercise.  In addition to our physical health, we should also pay attention to protecting our mental health.  We need to exercise our brains and take steps to reduce stress.  These efforts will pay some of the biggest dividends that we will ever receive.

These 8 steps to creating a good life will get you back to the basics

This is a time of adjustment.  It is a time to reflect on what’s really important and to get our affairs in order.  We could all use a shift to more basic and meaningful living.  I am convinced that the best that life has to offer is hidden in some of these 8 steps for creating a good life.  I hope you’ll click some of the links and explore it further for yourself!

What else can we do to get back to the basics and create a good life?

Photo by Ferdinand Reus