Thursday, June 29, 2017
Lifestyle Poverty
On Tuesday I spoke about a 3 step process to getting started saving money. The first step was to analyze your spending habits. Fixed expenses are always tough to eliminate. Things like housing, transportation, utilities and food can be trimmed but not often fully eliminated. Variable expenses, however, can be reduced if not fully eliminated. The problem with variable expenses is that we often gain comfort from spending our money on them. Most people will say they appreciate a cold beer after work more than they appreciate the electricity that keeps that beer cold. Reshaping your mentality when it comes to spending can save you thousands and for those not saving money, or not enough, this is completely necessary. Here are the common wastes of our precious, hard-earned money.
1) Lunch
We have to eat right? Do we have to eat Joe’s McKool House Bar and Grill for lunch 3 times a week? No, we don’t and shouldn’t. Spending $20 3 times a week eating out for lunch costs us $240 a month. That’s also $3120 a year! You better be saving double that if you want to spend that much on lunch. Brown bag the lunch poor boy.
2) Coffee
I drink coffee like most of you, but I don’t buy those Mocha-Latte Grande Crappuchino $6 nightmares. $2 a couple times a week at my local coffee shop is all I’m willing to spend. That’s my contribution to the local Coffee economy. The rest of my coffee is from home. Also, I challenge anyone who says the “need” their coffee in the morning. I call supreme bullshit on that. Try not drinking it for a week, I bet life will go on.
The Latte Factor Explained – Modest Money
3) Booze
Hey, I love a good night out with friends as much as the next guy. I also make sure I don’t break the bank doing it. If I do go over budget one night, then I chill out for a while. Sort of like coffee, you don’t need a beer after work. You enjoy a beer after work. Enjoy saving money every month just as much.
4) Restaurants
Do you know the markup at restaurants? I do, I worked in them for over 10 years. $17 hamburger and fries, $14 spaghetti and meatballs, $12 BLT sandwich. You don’t have to be a math whiz to see what’s going on here. If you can’t afford to save then you can’t afford to eat out, plain and simple.
Eating out is the top financial indulgence for most Canadians – Globe and Mail
5) Cell Phone Crap
I went a solid 5 years without a cell phone. During those days I made it to nights out, maintained relationships and lived somehow. I cringed when I had to get a new phone, but sadly you can’t be a financial advisor and not have one. I know some people that run $150 cell phone bills. Hey, genius, you are a cashier, why do you spend that much on a cell phone bill. Are you calling Columbia every month for hours at a time? Re-evaluate how much you spend on this junk.
Stop Living Paycheck to Paycheck – Budget Boss
6) Clothes
How do you have a closet full of clothes and not a dollar in your bank account? That makes no sense to anyone including yourself if you really think about it. Sales aren’t really sales and you know it. Don’t let the advertisers own you. No one gives away anything for free so don’t be a sale junkie. If you need clothes buy quality and take care of them. Places like American Outfitters sell clothes cheap because that is exactly what they are, cheap. They fall apart and you buy more. Makes sense right? Not to me!
7) Not working enough
Here is a pretty common sense idea. Work more and you have more money. Also when you are working you don’t have time to spend any money either because guess where you are all the time; that’s right, WORK! You make more money and spend less money. Sounds like a recipe for success to me. Give up the notion that anyone ever got successful working 40 hours a week. Truly successful people are working 50, 60, 70 hours a week. Don’t believe me? Ask their accountants.
15 Side-Hustles that Can Build Your Bankroll – Budget Boss
I believe money is a weapon. I think we can use it to gain the lives we want but also use it to ruin our own lives. What you chose to do with your money is what will define your success. Last week I told the story of a man who never made more than 45K a year and is able to retire early. It is no stroke of luck or coincidence. It is strategically using his money to make himself wealthy as opposed to making everyone else rich. Remember your money is yours until you give it away. Make sure you keep as much of it for yourself and you will be rich, trust me.
“Don’t tell me where your priorities are. Show me where you spend your money and I’ll tell you what they are.” —James W. Frick
Email – joe@budgetboss.ca
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