Indonesia
Frugal Living; How to Start It
Well.. not necessary, Supermom. Frugal living is not about sacrificing. It’s about how to live a smart life, an effort to gives us the life we want to live.
Frugal living refers to better money management. When we know how much money we have in the bank and how much do we need for monthly expenses, we can start making better decisions of how to spend them. Does the price for a pair of shoes worth a party that only takes two hours? Is this the right time to change our car?
Frugal living is also means smart shopping. It’s how to get the best price for what we purchase. Don’t be hesitate to drop by to a store that is having special prices, take a look around yard sales, wandering around racks, collect coupons or even ask for possibility of barter.
Frugal living also means pushing creativity to the limit, Supermom. Find a better way of doing things. Do we always have people change the car engine oil or we do it our self? Fix the old jeans or buy new ones? Buy plastic bag or reuse the one from the store?
If the concept of frugal living is yet to root in our head, try something else. For example, we can arrange tighter monthly budget money. Let’s grab a pen, calculator and a piece of paper.
- Make calculation for monthly spending. List the regular expenses, including the money for having fun (dinner out, hobby or entertainment). This having fun budget is crucial because to save money is different with total nothing. Also make a list of the minimum payment we should spend to pay off debt and credit card.
- Sum up the income. Make calculation of how much money we make every month, including from any investment, part time business and small jobs.
- Subtract expenses from income. We can see how much money we actually have left by the end of the month.
- Update the budget. If the first calculation comes out negative or at least not satisfied, we may need to run the numbers again. Look at expenses we can press such as phone credit, electricity bill, or kids shuttle for school.
- Leave out some money to pay debt off. If we have some mortgage at the bank, the budget to pay it should be from the monthly expenses. Now, look again which expense to put the pressure on for compensating it.
- Prepare saving and investment. Now it’s time to allocate some fund or our financial purposes. Which do we want; emergency saving? Retirement investment? Holliday saving? Make the list and do another survey to get the number we need for it. Well, if we still have many debts, perhaps this part can be skipped for now. Not a big deal. Debt should be the priority.
Frugal living is about determining what we want and to find a way there. Saving one hundred rupiah here and some thousand there will not strain our life. On the contrary, they can turn into possibilities with ranged limits. Decide we want in life, Supermom, and save to reach it.
PHOTOS: THINKSTOCKS
