Think you can’t do a budget? Think again. In a recession or depression, having a budget is your best tool to manage money, stay financially safe, and still build wealth.

You’d never see a carpenter who didn’t use house plans to build a house. Without plans, the second bathroom might be completely forgotten when building.

There’s no way an engineer would begin construction on a new technological development without a thoroughly detailed set of design specifications. but for us, when it comes to money, so many of us run our daily lives without any idea about how to manage finances and use a financial plan.

How smart is that, especially when the economy is in bad shape?

The “blueprints” for your money plan is the budget. Using one is critical to reach your financial goals, but also for day to day improvement of your money situation. Without a budget, your financial life will continue to drift all over the map, without reaching goals, without making your and your family more wealthy.

Start your budget by figuring out what your financial goals are. If you’re married, do this with your partner. Look at the long term financial goals as well as short term.

Your budget is then a plan to achieve those goals. Start with a single step, by making a realistic budget that you can live with and stick to, to start building wealth.

It isn’t hard to do a budget – it’s not like a diet. You have to allocate your money each money, to the expenses you have as well as some for savings. Start by listing your income for each month, then underneath list of all of your monthly expenses. Be sure to leave some room for fun items, otherwise you’ll never stick to it. But remember that discretionary spending – items other than necessities – are the reason many people do not reach their wealth goals.

If you are unable to cover all of your expenses each month, start deciding where to cut to fit your expenses into your paycheck. The idea is to live within your means.

and don’t use credit to make up the difference. right now, we’re all seeing the results of that! You want to pay off credit cards, not keep growing the balances. We’ll talk about how to pay off your debt in a future post.

With a basic budget, you can get started putting money aside. Just put some money into a savings account, where you can keep it safe, and set it aside for emergency funds in case you lose your job or have another financial emergency like car trouble or illness. This is the fund that will keep you afloat in really bad times, and help you avoid losing everything.

Living within your means is hard – we’ve been taught the opposite in America – to spend above your means. But we now see the bad outcomes of that – bankruptcy, losing homes, losing jobs. So to make sure you survive a depression or recession economy, start today to spend less than you make, and create a budgets.

Food prices have jumped in the past year – as much as 10%+. This is killing many of us, I know my budget is strained by food prices! You can save on groceries and not just by using coupons either – coupons can sometimes cost you more whenyou buy things you don’t really need, or opt for premium brands over generic just because of a coupon.

These tips can help cut yoru food costs.

1. Compare prices. Find the lowest prices stores – it can be an ongoing battle though. Many stores are reducing the number and quality of sales. I usually don’t go to a store just for a sale unless it’s a big one on expnsive items like meats, then I stock up. I also don’t pay an annual fee to shop at warehouses, there is a local warehouse store with no fee needed. Bottom line, look for the best overall price.

2. Don’t use coupons for items you would not normally buy. Coupons can lead us to buy things we normally wouldn’t – like buying two items to get the discount, when it takes forever to use up one! That’s cash out of your pocket today. Instead stick to coupons for items you need and use regularly. And of course always get double coupons! Find out more about using coupons here.

3. Buy less prepared and packaged food. The more cooking, plastic, cardboard and wrapping that goes into a product, the higher the price and the less nutrtition for the buck. Buy bulk meats, veggies and fruits, make your own and freeze the leftovers or package into bags. Just start to compare the price per pound or ounce for packaged foods with non-packaged, and you’ll get it fast enough.

4. Phase out using some things. Instead of paper towels, napkins, plastic ware, paper plates, replace with cloth. Instead of junk food with poor nutritional qualties and ever rising prices ($5.50 for a bag of tortiall chips???) start making your own or buying more healthy treats like baby carrots, basic crackers, and so on. Try cutting 2or replacing -3 items each shopping trip, it will add up!

5. Eat less meat. Make a few vegetarian meals. You can make a tofu lasagna that includes the protein of tofu and tastes no different. Or just a quick stir fry of veggies and tofu. You can also get compelte proteins from beans. Learn how to prepare lentil stews, black beans and rice, and other bean and grain dishes to save big.

Try these tips for saving on groceries, and cutting your food costs, and don’t forget to bank the savings each month !

The only way to have wealth and financial security is to have money in the bank. That means savings – which most of us haven’t really focused on for years! Instead we’ve built up debt, so that we are working to pay off credit cards, cars, houses. Today we’re going to talk about some top strategies to save money.

The fact is, the ways to save money haven’t changed for hundreds or even thousands of years. Benjamin Franklin wrote “A penny saved is a penny earned”, and it’s still 100% true hundreds of years later. All you need to do is spend less than you earn, and put the difference into savings. It is actually easier than it sounds if you break it into specific steps.

Here are some tips on how to save money so that you see fast cash in the bank, right away. These are meant to be short – so you can start now and see quick cash results!

1. First on the list is BUY LESS. When you spend more than you earn, you can never – repeat, NEVER – get ahead financially! Start by cutting spending, and next we’ll figure out where to save it. you can cut spending by just not buying things you don’t really need: coffee, manicures (do it at home!), weekly hair cuts, junk food, vacation, car lease, knick knacks, excessive food, personal electronics, excessive cable television plans, expensive cell phone plans – you get the idea. We’ll print a l-o-o-o-n-g list of even more ways to save money in a future blog post.

2. Open A Savings Account for Your Savings. You can now open online savings accounts where you can transfer money with a click of a mouse; or, you can open an account in a local bank so that you can stop by every day and deposit the massive earnings (kidding!) from your cost cutting in Step 1. But here’s the deal – open the account TODAY, NOW. This account should be apart from your checking, and is ONLY for your saving strategies funds. Don’t wait! You can look for high interest rates, but realistically, until you have a thousand or more, you will not see much given current rates. This account is merely to have a place to stash your cash so you don’t spend it.

3. Pay Yourself First. Each and every payday, put something away in savings FIRST. You might think you dont’ have enough to cover your bills, but we’ll show you in the next step that’s not true. So, set up an automatic payment from your employer to your savings account, even if it’s $10, $25, or $50. Do This First Thing your next day back at work – ask your employer how to set up a direct deposit to your new savings account from #2 above.

4. Make Some Extra Money. You can easily and quickly make extra cash. Have a garage sale, sell things you don’t use any more on Ebay or Craig’s List or Kajiji, just clean out the closets. If you can write, are handy on the Web, or can perform administrative duties, find part time contract work at GetAFreelancer.com, or visit DoMyStuff. All of these can be done at home. Or, learn how to build an online blogging business – it takes a little longer to start making some cash, but can also be done at home.

5. Now – Put It All Together! Putting all these four together works out like this: You are able to put $25 per paycheck aside, for $50 per month or $600 a year. Set a goal to cut your household budget by 10%, which for households spending $35,000 per year for a family of four, that would equal $3,500. You are now over $4,000 in your new savings account. On top of that, if you earn an extra $200 per month doing extra work, bank all of that money into your savings – which at $200 a month, would be $2,400 per year. In this example, your savings would be nearly $6,500 – plus whatever interest you are able to make on your account.

Even if you were able to get half those numbers into a savings account, these tips on how to save money will get you into a new mindset of putting your own financial well being first, before bringing more junk you don’t need into your home and your life. To save money, you need to do something different. Take it one step at a time, and set goals, soon you’ll be on your way to wealth.

I’m not a finance expert, just a middle-class American watching the financial nightmare unfold in front of my eyes, and I’m deciding to do something about it.  Putting more cash aside, taking steps to bring in more cash, and save, save, save is the goal. I don’t have a $$ amount I’m trying to reach – yet – instead, the idea is to make sure that whatever happens, I’m not broke.

This is not about “personal finance’ or what to do with your retirement, or how to get out of debt. This is way more basic:  about having money in hand, or tradeable/sellable skills, or whatever is needed, to survive a massive economic blowout – and if the blowout doesn’t happen, I don’t think I’ll complain in that case either!

Here’s what I’m talking about:

- Figuring out how to save as much as possible, by buying less (or nothing), getting deals, and conserving.

- Finding best places to put the cash so it’s relatively sage – that is, the best rates on savings accounts, specific investments, other ideas. (Hint: This means NOT mean paying off credit cards first!)

- Making extra money – the fast kind, not the job kind; I’m not talking about overnight millionaires or anything, just ways to get a couple hundred (or maybe more!) coming in each week?

I think this crash is just the start.  Stocks may not come back because the wages and jobs aren’t there that are needed to fund consumption without credit.  We won’t have income because as customers we’re too broke to buy. It’s a vicious circle, and without credit no one’s going anywhere.

So, in the mean time, the goal is to keep cash coming in, prevent it from going out, and and do whatever it takes to protect your finances.  Inflation is going to be the next bugaboo, but one thing at a time for now!  I’m working on a list of ideas I’ll post here.

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Want to start piling up cash?  For anything you need in the next 5 years, some are advocating that you start saving you cash.  Maybe for beyond 5 years!

Here are some ways to slash your budget and start putting aside cash out of your next paycheck.

Cut these from your budget NOW!:

- Entertainment expenses: movies out, dining out, fast food, expensive vacations in favor of closer/shorter/less costly.  Use the library for movies, video, music, and much more than just books.

- Lunch at the office: take your lunch and save $200+ a month.  Try a potluck once a week with several co-workers for something different.

- Fuel costs: start carpooling, cut the number of trips you take each week, put the kids on a bus or bike instead of chauffering. Driving 55 saves 25-30% of fuel burned by your engine as driving 70 MPH or more.

- Your electric bill: Shut off lights. Switch to CFLs, which save over the long run. Use cold water for laundry, take shorter showers. Turn down thermostat in winter, turn up AC in summer.

- Cable - save $100s a month! Watch on the Internet!

- Try the thrift store. Yes really. We have been buying new and like-new brand-name designer women’s clothing for under $5 per item.  Not to mention other household items – a boy’s  bike, brand new, for less than half price.

- Buy food in bulk, buy it now for the year. Seen the way prices have jumped 10%, 15%, even 25% on items over the past six months?  Clear away some room in the basement or a closet and stock up.

Post a comment with your best ideas for saving IMMEDIATELY!

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