Budgeting isn’t rocket science but, as we point out below, a lot of American still have trouble saving money. This can be particularly problematic for transitioning service members and their families who often encounter major financial changes when they exit military service. To make that move a bit easier, we’ve put together some great ideas for veterans looking to tighten their belts and save a little more money.
Establish Cash Reserves
One of the best reasons to follow a budget is to achieve financial security. According to the financial news site MarketWatch, however, only half of Americans have more than a month’s pay saved away. Even more alarming, most consumers admit that they’re unprepared for a single financial emergency, such as a broken water heater.
Ask any veteran about preparing for the future and they’ll be the first to tell you that even the best plans don’t survive the first contact. Finances are no exception, so it would be wise to start saving today. Most experts recommend saving approximately 10% of your income and keeping at least three months’ worth of living expenses on hand for emergencies.
Success on the battlefield requires solid preparation and planning, which in the military involves the application of sound strategy and tactics. Applying the same sort of attitude to budgeting will lead you to financial success.
First, consider setting up automatic allotments for yourself. Just as you might send automated payments to a creditor, try allotting yourself a set amount of spending money each month. Do this by sending a predetermined amount to your checking account every payday and stick with it.
Speaking of credit cards, make it a point to limit their use. It’s not a bad idea to keep one available for extreme emergencies and the occasional purchase, but routinely using credit is a financial rabbit hole that you’ll want to avoid.
Finally, try to set at least one week aside where your expressed goal is to not spend any money. This might sound daunting at first but, with a little planning, will really bolster your savings.
Most veterans are familiar with exercising personal accountability and self-discipline but practicing financial responsibility might require a bit a practice. Here are a few tips to get you started:
Exercise financial restraint
One bad habit entirely detrimental to budgeting is impulse spending, whether is be on large purchases or daily extravagances like ordering pizza instead of cooking dinner. Take an honest self-inventory of your spending and see if there’s anything worth eliminating.
Categorize purchases and use lists
Something as simple as using grocery lists can save a great deal of money in the long run. Also consider planning other routine outings, such as trips to the hardware store or the gas station.
Closely track purchases
Both of the above tips are good advice but it’s also important to gain a starting point and understand your present spending habits. That said, consider recording your monthly spending habits by keeping receipts, starting a ledger, or using budgeting software.
Trim the Fat
Lastly, here are some ideas that will help eliminate those seemingly small or unnoticed things that can sabotage an otherwise great budget. Consider the following when fine-tuning your plans:
Pack a lunch
Think “brown bagging it” is a waste of time? Try adding up all those fast food receipts at the end of the week and you’ll be shocked to see how much of your hard-earned cash goes to restaurants.
Buy in bulk
If you’re really serious about saving money, consider joining a wholesale club and buying groceries in bulk; they’re normally much cheaper per serving than what’s available in the typical grocery store. Be sure to check your freezer space and make a list before you walk out the door, however.
Cut the cable
Ask yourself, “How much TV do I really need to watch?” Streaming services are a very popular and cost-effective alternative to cable television. High definition antennas are another cheap substitute for cable, with most local stations offering crystal clear programming in your area.
Brew your own coffee
Making your own morning cup of joe before heading out the door, instead of buying a pricy latte or cappuccino on the way to work, can save anywhere from $12-$15 per week.