Using Cash to Save You Money
Being in debt is not a pleasant experience. But you don't have to owe any money to find yourself short at the end of every month. It all depends on how well - or badly - you manage the funds you have at your disposal. Planning ahead is essential - in order to know how far your money has to stretch each month. The better you are at doing it, the less likely it is that you will run into problems.
Using cash is one way of managing your money, and it's actually quite easy to set up a system for doing this.
First of all you need to know how much you get paid each month, assuming you are paid on a monthly basis - if you get paid more frequently than this then you simply need to work on that time scale instead. Once you have this figure in mind, you need to work out how much all your fixed outgoings add up to; therefore, you would include your mortgage, insurance and other bills in this total, for example. Food shopping, however, isn't a fixed sum so that should be left out for the time being and there is a very good reason for doing so - going shopping with cash usually results in a smaller bill than if you use a credit or debit card.
You should then be left with a sum after you have paid everything you owe each month. This of course, needs to last the whole month and cover all the other outgoings you have. The best thing to do next is to divide that sum by four - that will give you a rough idea of how much you have to spend each week. Working off a monthly total can lead to overspending in the first week or two but if you work out what you have roughly per week to play with, then it's much easier to stick to and is also not as tempting.
The idea is to take that specific amount out of your main account at the beginning of each week and then whenever you need to buy something, you do so out of your cash. It's much harder to be frivolous with your cash by sticking to such plans.
You should also find you have more money left at the end of the month. In fact, you might even want to consider changing accounts, but this decision will more than likely be affected based on the current account rates. Of course, it is important that you consider the best deal and option that meets your situation, especially now that you can have potentially more money in your account each month.
Using cash is one way of managing your money, and it's actually quite easy to set up a system for doing this.
First of all you need to know how much you get paid each month, assuming you are paid on a monthly basis - if you get paid more frequently than this then you simply need to work on that time scale instead. Once you have this figure in mind, you need to work out how much all your fixed outgoings add up to; therefore, you would include your mortgage, insurance and other bills in this total, for example. Food shopping, however, isn't a fixed sum so that should be left out for the time being and there is a very good reason for doing so - going shopping with cash usually results in a smaller bill than if you use a credit or debit card.
You should then be left with a sum after you have paid everything you owe each month. This of course, needs to last the whole month and cover all the other outgoings you have. The best thing to do next is to divide that sum by four - that will give you a rough idea of how much you have to spend each week. Working off a monthly total can lead to overspending in the first week or two but if you work out what you have roughly per week to play with, then it's much easier to stick to and is also not as tempting.
The idea is to take that specific amount out of your main account at the beginning of each week and then whenever you need to buy something, you do so out of your cash. It's much harder to be frivolous with your cash by sticking to such plans.
You should also find you have more money left at the end of the month. In fact, you might even want to consider changing accounts, but this decision will more than likely be affected based on the current account rates. Of course, it is important that you consider the best deal and option that meets your situation, especially now that you can have potentially more money in your account each month.
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