Budgeting Articles

Article / Updated 03-28-2023

Shopping can often feel like a black hole on your finances. Money goes in and disappears into a vacuum. Every time you step into a grocery store or discount department store, you may feel like you’re out of control and you come out flat broke. To prevent your shopping trips from turning into guilt trips, take time to think about how you can spend more thoughtfully. Save by reducing and reusing When considering a purchase, always keep the following in mind: Reduce, reuse, and recycle. Ask yourself these questions: Do you really need it? Do you already own or have access to something that you can use instead? Try to reduce your purchase of processed, prepackaged foods. The more packaging and processing involved, the more the food costs you. By reducing your purchase of packaged and processed items, you save money and resources. Prepackaged groceries generally cost at least twice as much as whole foods, often multiple times more. Also try to buy whole foods in their natural state whenever possible: fresh fruit, vegetables, meat, and dairy products. Yes, cooking is required, but cooking doesn’t have to be drudgery. Sharing a home-cooked meal brings people together, saves money, and can be much healthier than the alternatives. You can reduce trash and save money by minimizing your use of paper towels, disposable plates, and cups. Instead, reuse cloth towels and napkins and use durable dishes because you can wash and reuse these again and again. Go for permanent or reusable over disposable every time possible. Take your shopping bags with you to the grocery store. Many stores credit you 5 cents per bag for bringing your own or charge you if you don’t. You’re not only saving money but also saving landfills. Over the course of a year, simply reusing shopping bags, napkins, plates, and cups can save you $40 to $60. Just think of how many other items you can apply this concept to. If you can cut costs without cutting your lifestyle, why not? Use your money in other ways that give you more enjoyment and satisfaction. Tips for keeping expenses down The following are some other ways to keep your shopping expenses at a minimum: Use a shopping list and purchase only the items on your list. Organize your list based on the layout of your store and stick to the outer walls where all the healthy options are. By following this guideline, you can begin to better plan your expenditures. And if you stick to your list and a routine, you can eliminate those nasty impulse purchases. Don’t go grocery shopping when you’re hungry. People typically spend more and buy more processed — and, therefore, more expensive — food when they’re hungry. Buy merchandise when it’s going out of season. Buy next year’s winter coat or swimsuit when the prices are dirt cheap instead of at the beginning of the season, when the item’s not on sale. And when you’re shopping for clothes, buy wash-and-wear clothes rather than dry-clean only. Buy second-hand. eBay and Craigslist have changed the landscape of shopping for pre-owned items. Before you buy something, check online first to see whether a pre-owned version is available. You can also find treasures at thrift stores and garage sales. Shop at discount stores. Deep-discount grocery stores, such as Aldi’s, can save you a lot of money. Buying store brands and in bulk Many stores carry store brands, items with the store’s name on the label. Or they may carry generic products, those items labeled without a brand name of any sort. If you’re willing to be a bit adventurous, keeping your eye out for inexpensive store brands and generic products can shave a substantial amount from your grocery budget. People often say that they don’t care for the taste or quality of store brands or generic items, but you may be surprised to discover that many products carrying generic or store brand labels are actually top-quality, name-brand items packaged under a different label. You may have the best luck with generic versions of: Tomato sauce and paste Canned and frozen vegetables Canned soups Cookies and crackers Dairy products (milk, butter, and cheese) Coffee and tea Bread, rolls, and buns Finding space for bulk purchase groceries and supplies Do you think you don’t have room for bulk purchases because you don’t have a pantry? Well, look at the back of your linen closet shelves behind the folded towels. If you’re like many people, you may have some empty space just waiting to be filled with a stack of cans, boxes, or packages. What about that empty corner in the garage? Or, look underneath your beds, and what do you see? Empty space and dust bunnies? Any of these places can be potential storage spots for a case or two of extra stewed tomatoes or refried beans. You can also split bulk orders with a friend or relative if you really don’t have the room but want to experience the savings to be found in bulk purchases. Seeing through the gimmicks Grocery sellers spend money to learn how to fool you into spending more in their stores. Whether they’re enticing you into the store in the first place with sale items or convincing you to buy more expensive items, be aware of some of these tactics: The aisle switcheroo If you shop at a particular store regularly, you know where everything you buy is located in each aisle. Without realizing it, you’ve developed a form of tunnel vision and don’t really see anything except what you need. When the store rearranges the aisles or moves items from one position on a shelf to another, you have to look around and actually focus on each aisle and every shelf. By losing your tunnel vision for a time, the possibility of something new catching your eye increases dramatically, and consequently your impulse purchases increase, too. The store’s layout Most grocery stores have the same general floor plan — they keep produce, bread, dairy, and meat products along the edges of the store or up against the walls. By putting commonly purchased items against the farthest wall or way off in a back corner, customers have to walk past numerous displays and shelves full of goodies. Shop the edges of the store to save considerably on your grocery bill. Added benefit: The perimeter carries the healthiest items in the store. Your waistline — and your budget — will be healthier. Shelf arrangements If you want to find the best values on the grocery store shelves, look high on the top shelves or bend down and look at the bottom shelf. The brand-name and higher-priced products (as well as products designed to entice children) are located at eye level, while the generic, store brand, and lower-priced items are in the more awkward places to see. Using coupons and rebates People either love coupons and rebates or find them to be more work than they’re worth. Coupons and rebates are a valuable addition to a well-rounded approach to saving money. To make the most of your coupon savings, follow these suggestions: Look for double-coupon and triple-coupon deals. Look for coupons for items that are already on sale or that are deeply discounted. Don’t assume you get the best deal with the coupon; store brands can still be cheaper. When shopping online, look for online coupon codes to save on the purchase price or on shipping and handling charges; just type the name of the store and "coupons" into your favorite search engine to see what you find. You can also try websites like Rakuten, Honey, and RetailMeNot. To receive a rebate, you must fill out a rebate form and mail it along with proof-of-purchase materials — usually your original cash register receipt and the Universal Product Code (UPC) or barcode — to the manufacturer. Occasionally, a store will offer rebates in the form of store credit rather than money back from the manufacturer. If you shop in a store regularly, credit for shopping there again can be helpful to the budget. But be careful you don’t use the store credit as an excuse to buy things you normally wouldn’t purchase. The store isn’t really trying to save you money — they’re trying to entice you into spending more money.

Article / Updated 03-16-2023

You don’t have to sweat out the dog days of summer, even when cutting back on your awesome, home-cooling air conditioning to save money. You can stay cool, even when it’s hot outside. Add insulation to your home. First insulate your attic floor, and then when time and money allow, add insulation to your basement, exterior walls, floors, and crawl spaces (in that order). Improve attic ventilation. Adequate ventilation under the eaves allows cooler air to enter and circulate throughout the attic. If you don’t have a permanent exhaust fan, you can set a box fan with the airflow pointed outward to pull the hot air out of the house. Shade your house from the sun. If your house isn’t shaded by trees, install awnings over any windows that are exposed to direct sun during the day. Cover your windows. Windows are a major source of heat during the summer. Reduce the heat coming in through your windows by closing the drapes during the day, adding reflective window tint to southern windows, and hanging old-fashioned bamboo shades outside. Make your air conditioner work less. If you use an air conditioner to cool your house, turn the thermostat up a bit higher than the temperature you usually set. Also, set the temperature higher for times when you’re not there. Use fans to circulate air. Moving air feels several degrees cooler than still air. Reduce how much heat you create inside your house. Use appliances other than the stove and oven to cook (such as the microwave, slow cooker, electric skillet, or toaster oven). Don’t use the heat setting on your clothes dryer.

Cheat Sheet / Updated 01-12-2023

How can you save for retirement when you need all your income to make ends meet now? What do you do when college loans come due and money is tight? How can you trim back household expenses? When the economy is down, you can still save money without sacrificing your quality of life. Every little change you make to your finances can help. Here, you get some tips on saving on energy costs, shopping smart, and making a budget.

Article / Updated 12-14-2022

You probably hate the idea of a household budget. However, a budget is a basic and important money-management tool for getting out — and staying out — of debt. So, if you’re serious about improving the state of your finances and avoiding future problems, you need to lose your antibudget bias. A budget is nothing more than a written plan for how you intend to spend your money each month, how much you’ll contribute to savings and retirement, and so on. A budget helps you live within your means. It doesn’t have to be scary. When you’re drowning in debt, a budget is your financial life raft. Over time, if you stick to your budget and work on reducing your debt, your financial situation will improve. But even when your financial outlook is rosier, you should continue to manage your money by using a budget. Otherwise, you may get careless about your spending or begin using credit too much, and your debt may creep up to dangerous levels again. Living on a budget also makes it easier for you to Build up your savings so you have money to fall back on if you’re hit with a big unexpected expense, if you lose your job, or if you have to take a pay cut. Purchase big-ticket items with minimal use of credit. Help make your family’s financial dreams come true: a new home, a great vacation, college educations for kids, a comfortable retirement. Creating a monthly budget for your household is not a complicated process, but it can be time consuming. Simply stated, you need to do this: Compare your current total monthly spending to your current total monthly income. Reduce your spending as necessary so that it’s less than your income. Allocate your dollars appropriately so that you are able to pay all your living expenses and debts. Categorizing your expenses Creating an annual spending and income worksheet, like the one below, will help you organize your spending and income information and make sure that you don’t overlook anything. This worksheet will also come into play later in this budgeting process. The worksheet divides your spending into three categories: Fixed expenses: These expenses stay the same from month to month. Examples are your rent or mortgage, car loan, home equity loan, and insurance. Variable expenses: These expenses tend to vary from month to month. Examples are your groceries, gas, utilities, restaurant meals, movies, and books. Periodic expenses: These expenses may be fixed or variable. You pay them just once in a while, such as quarterly, every six months, or annually. Tuition, some kinds of insurance, property taxes, and dues are examples. Some expenses listed as fixed on the worksheet may actually be periodic expenses for you. For example, instead of paying your auto insurance every month, you may pay it every quarter. After you’ve calculated total annual amounts for each of your debts and for all your living expenses, enter them on the appropriate worksheet lines. Annual Income and Spending Worksheet Annual Income Your household take-home pay $_______________ Child support income $_______________ Alimony income $_______________ Other income (specify the source) $_______________ Other income (specify the source) $_______________ Other income (specify the source) $_______________ Total Annual Income $_________________ Annual Spending Fixed Spending Rent $_______________ Mortgage $_______________ Home equity loan $_______________ Condo or homeowners’ association fee $_______________ Car payment $_______________ Other loans $_______________ Homeowner’s insurance $_______________ Renter’s insurance $_______________ Health insurance $_______________ Auto insurance $_______________ Life insurance $_______________ Other insurance $_______________ Childcare $_______________ Dues and fees $_______________ Cable/satellite/streaming services $_______________ Internet access $_______________ Child support obligation $_______________ Alimony obligation $_______________ Other fixed expenses (specify type) $_______________ Other fixed expenses (specify type) $_______________ Other fixed expenses (specify type) $_______________ Other fixed expenses (specify type) $_______________ Total Annual Fixed Spending $_________________ Variable Spending Groceries $_______________ Cigarettes $_______________ Alcohol $_______________ Utilities $_______________ Cell phone $_______________ Gas for car $_______________ Public transportation $_______________ Tolls and parking $_______________ Newspapers, books, and magazines $_______________ Allowances $_______________ After-school activities for kids $_______________ Baby-sitting $_______________ Entertainment $_______________ Restaurant meals $_______________ Personal care products $_______________ Clothing $_______________ Body care (haircuts, manicures, massages) $_______________ Laundry and dry cleaning $_______________ Out-of-pocket medical expenses $_______________ Lawn care $_______________ Home repair and maintenance $_______________ Other (specify type) $_______________ Other (specify type) $_______________ Other (specify type) $_______________ Other (specify type) $_______________ Total Variable Fixed Spending $_________________ Periodic Spending Insurance $_______________ Auto registration and inspection $_______________ Subscriptions $_______________ Charitable donations $_______________ Tuition $_______________ Dues and fees $_______________ Income taxes $_______________ Property taxes $_______________ Other (specify type) $_______________ Other (specify type) $_______________ Other (specify type) $_______________ Other (specify type) $_______________ Total Annual Periodic Spending $_________________ Total Annual Spending $_________________ Total Annual Income $_______________ minus – Total Annual Spending $_______________ equals = Your Bottom Line $________________ Comparing monthly spending and income Now that you've completed the worksheet above, you can move on to comparing your monthly spending and income using the worksheet below: Divide each of the annual dollar amounts in the annual worksheet above by 12 to come up with monthly amounts. Make photocopies of the monthly spending and income worksheet below (so you can use it multiple times). Record each monthly amount in the appropriate worksheet spaces below. Review the dollar amounts and adjust them up or down as necessary so they’re as accurate as possible. For example, the cost of your auto insurance may be about to increase, your child’s tuition may be increasing next month, or your income may be decreasing. Always assume the worst scenario so that you build in a potential cushion. If your annual totals don’t include living expenses and debts that you should be paying but aren’t because you don’t have enough money, add them to your annual totals before you divide by 12. For budget-building purposes, you must have an accurate picture of all your living expenses and debts. Subtract your total monthly spending from your total monthly income. Record that amount on the worksheet; it can be a negative number. Monthly Spending and Income Worksheet Monthly Income Your household take-home pay $_______________ Child support income $_______________ Alimony income $_______________ Other income (specify the source) $_______________ Other income (specify the source) $_______________ Other income (specify the source) $_______________ Total Monthly Income $_________________ Monthly Spending Fixed Spending Rent $_______________ Mortgage $_______________ Home equity loan $_______________ Condo or homeowners’ association fee $_______________ Car payment $_______________ Other loans $_______________ Homeowner’s insurance $_______________ Renter’s insurance $_______________ Health insurance $_______________ Auto insurance $_______________ Life insurance $_______________ Other insurance $_______________ Childcare $_______________ Dues and fees $_______________ Cable/satellite/streaming services $_______________ Internet access $_______________ Child support obligation $_______________ Alimony obligation $_______________ Other fixed expenses (specify type) $_______________ Other fixed expenses (specify type) $_______________ Other fixed expenses (specify type) $_______________ Other fixed expenses (specify type) $_______________ Total Monthly Fixed Spending $_________________ Variable Spending Groceries $_______________ Cigarettes $_______________ Alcohol $_______________ Utilities $_______________ Cell phone $_______________ Gas for car $_______________ Public transportation $_______________ Tolls and parking $_______________ Newspapers, books, and magazines $_______________ Allowances $_______________ After-school activities for kids $_______________ Baby-sitting $_______________ Entertainment $_______________ Restaurant meals $_______________ Personal care products $_______________ Clothing $_______________ Body care (haircuts, manicures, massages) $_______________ Laundry and dry cleaning $_______________ Out-of-pocket medical expenses $_______________ Lawn care $_______________ Home repair and maintenance $_______________ Other (specify type) $_______________ Other (specify type) $_______________ Other (specify type) $_______________ Other (specify type) $_______________ Total Monthly Variable Spending $_________________ Periodic Spending Insurance $_______________ Auto registration and inspection $_______________ Subscriptions $_______________ Charitable donations $_______________ Tuition $_______________ Dues and fees $_______________ Income taxes $_______________ Property taxes $_______________ Other (specify type) $_______________ Other (specify type) $_______________ Other (specify type) $_______________ Other (specify type) $_______________ Total Monthly Periodic Spending $_________________ Monthly Contributions Savings $_______________ Retirement $_______________ Other (specify type) $_______________ Other (specify type) $_______________ Other (specify type) $_______________ Other (specify type) $_______________ Total Contributions $_________________ Total Monthly Spending and Contributions $_________________ Total Monthly Income $_______________ (minus) – Total Monthly Spending and Contributions $_______________ (equals) = Your Bottom Line $_________________

Article / Updated 10-26-2021

After you determine your actual spendable income, you can focus on how that remaining money needs to be spent. The first step to creating a budget is to sort expenses into three categories: needs, wants, and luxury items. But how do you distinguish between the three? What qualifies as a need can sometimes be blurry. A person basically has very few true needs: shelter, clean water, food and a way to prepare it, clothing, and warmth. Of course, it isn't realistic to expect a person to thrive with only these items. If you have a job, you need to be able to get there; you and your family need to protect themselves and their health; and you might be legally required to make other payments. But not everything you feel like you need actually is a need. Unless it's required for your job (in which case you ought to be reimbursed or deduct the expenses from your taxes). In order to create a budget for yourself, you first need to take a hard look at what you need versus what you want. Figuring required expenses Your required expenses, or needs, must come first. To figure out what your required expenses are, fill out this Required Monthly Expenses worksheet. If you have a surplus after meeting your required living expenses, go ahead and check out the next section on using your excess money for wants. If you aren’t already doing so, set up automatic monthly withdrawals from your paycheck or your checking account to pay for or fund each of the required expenditures. That way, your requirements are met automatically each and every month, and whatever is left over is yours to spend however you see fit. Wading through your wants Hopefully, you find yourself with some “extra” money after paying for your needs. You can use the Desired Monthly Expenditures worksheet to figure out your wants and how much you’d like to spend on them. After you add all your needs with the list of wants, you will likely discover that you have little or no surplus cash. If you determine that you have negative cash flow, you should prioritize your expenditures so that you don’t plan to spend more than you bring in. Solving for shortfalls If you have a shortfall after you calculate your required expenses, something has to give. Consider the following suggestions when you’re faced with a shortfall: Don’t completely cut out any of your required expenditures. You may be tempted to consider dropping insurance coverage and/or the amount of money you save for a “rainy day” if you don’t have surplus cash flow. You aren’t doing yourself any favors by skipping these items, and the decision will come back to haunt you sooner or later. Review each of the needs categories and consider ways to cut down on necessary expenses. For example, you may be able to obtain less expensive insurance and save money on groceries, clothing, and transportation by shopping around. Consider your employment. Often, the only reasonable option you and your spouse or partner may have is to increase your income by working overtime, taking on a part-time job, or possibly even changing jobs.

Article / Updated 07-02-2021

The federal Food Stamp Program is now called Supplemental Nutrition Assistance Program (SNAP); and instead of issuing paper food stamp coupons, SNAP recipients get an electronic benefit transfer (EBT) card to use in participating stores. When paying for groceries, you just swipe the EBT card in the same card reader that's used for credit and debit cards, put in your PIN number, and that's it! Whether you call it food stamps, a SNAP card, or the EBT card, here are some pointers to remember for using it: At the end of your purchase transaction, you should be able to see how much money is left in your account. You can't debit a higher amount than the cash register total and get cash back. Most participating stores indicate that they are SNAP members by displaying a sign in their window, but if you're not sure, ask the service counter or one of the cashiers. (The sign might say something like "We Accept Food Stamps, EBT, or SNAP Benefits.") You can buy most types of edible items in categories that you'd find in a supermarket: dairy, meats, produce, and so on. (Seeds that will be used to grow edible foods are also eligible.) Items that you can't buy with food stamps include: Alcoholic beverages and cigarettes Vitamins and medicines Any food that will be eaten in the store Any hot food Non-edible items like laundry supplies, paper products, and pet foods Your EBT card is good in all 50 states, even though you may have enrolled in one particular state. (The card doesn't work in Puerto Rico but does in the District of Columbia, Guam, and the U.S. Virgin Islands.) Any food stamp benefits that you don't use in one month will be carried over to the next month. However, if you don't use your SNAP card for a year, you will no longer be entitled to receive benefits. While SNAP is a federal program run by the U.S. Department of Agriculture, eligibility is handled by each state — and each state has its own set of rules. To find out if you're eligible for SNAP benefits, contact your local SNAP office.

Article / Updated 03-26-2016

Does the word budget send chills up your spine? It shouldn’t. Budgets allow you to have some control over what you spend. A monthly budget can help you to decide how to spend your money, plan for your future, pay off existing debt, and save a few pennies each month by reducing wasteful and impulsive purchases. To create your monthly budget Categorize your expenses. When you begin setting up a monthly budget, start with big categories before breaking your budget down into smaller expense categories. From your list of expenses, develop two separate budget lists, one for essentials and the other for extras. Within each general budget category, some items are essential (the mortgage or rent payment, electric bill, and groceries); others are extra (new furniture, gifts, and pizza delivery). Look through these lists to find flexible budget expenses where you can cut back. Put a star next to these flexible items so you can identify them. Estimate what you spend. Go through your checkbook and any other receipts or records you’ve kept over the past few months so you can track how much you actually spend on both essentials and extras. Add up your budget essentials list and the extras list separately. By keeping the lists separate, you can make cuts more easily, if you need to. Subtract the essentials total from your monthly income and, if you have money left over, subtract the extras total from that amount. If you still have money left over, great! Look into a savings or investing plan (talk to your bank or a certified financial planner for help setting up a plan). If your extras list takes you into negative numbers, start looking for places to cut back. You can also trim from the extras list to put more money toward debt repayment if that’s a high priority in your financial picture.

Article / Updated 03-26-2016

Your financial plan should involve the dreams, goals, resources, and responsibilities of the entire family. If you have a spouse, partner, or children, you may need to provide guidance as your family develops a financial plan. The success of any financial plan is dependent on the support, persistence, and dedication of all people involved. Without the participation of the entire household, you’ll face a continual uphill battle when it comes to your finances. Your spouse, partner, or children can be a help or a hindrance. As a family, you will face many challenges along your financial journey. But if family members are truly on board, they will work to help find solutions and not create additional challenges for you. How do you get your family on board with your financial goals? You must inspire them, just like a coach might. A coach needs the cooperation and coordination of each player on his team. In order to get teams to pull together, great coaches lead by example and command the utmost respect from each and every team member. Their team members strive to perform at their very best each and every game, not only for themselves, but also for their coach and their team. Great coaches inspire greatness. So how can you inspire your family when it comes to your personal finances? Share your vision, in living color, with your family members — your team. When you present your vision, make sure that you include the vivid details of why a goal is important to you and your family, and what accomplishing this goal will enable you all to enjoy. Elaborate on the payoff for putting in the hard work, compromise, or sacrifices that may be required to achieve these goals. The example shown here points out the objective and provides a few suggestions to help family members design creative solutions instead of just focusing on problems. Now you must figure out how to inspire your own family. On a sheet of paper, write down what you’d like to say to your family as you seek to bring them on board with your financial future. What subjects are near and dear to your spouse’s or children’s hearts? Start there — they’ll be highly motivated to help you help them get what they want.

Article / Updated 03-26-2016

Tracking your expenses is especially useful when your outgoing cash flow exceeds your income. Fortunately, you don’t need to go back and tally up months’ worth of checking account registers, credit- and debit-card statements, and cash withdrawals. This is a very time-consuming and painful exercise. Just estimate! Use the Cash Flow Monitoring worksheet to help you monitor your spending for the next couple of months. As you pay your bills, complete the worksheet. Click here to download and print the Cash Flow Monitoring worksheet. If you're looking for a simpler method of tracking your expenses, you can use the Expense Tracking Log to track every cent of just the surplus money — after all your taxes, bills, and other necessaries are paid — that you have to spend. Click here to download and print the expense tracking log. Write down every occasion you spend your surplus money, whether you buy your morning coffee, an afternoon soda at work, or gas on the way home. Account for every cent. Also, track whether you paid with cash, check, debit card, or credit card; whom you paid; and whether the expense is a need or a want. Use one log for each pay period. Note at the top of the worksheet how much your beginning surplus is (which you'll need to figure separately) and subtract from that amount each expenditure. By keeping your eye on the “magic number” (your surplus cash flow after meeting your required expenses), you can simply spend your money any way that pleases you — so long as you don’t exceed the “magic number.” No more detailed budget keeping required.

Article / Updated 03-26-2016

Money is something that touches most aspects of your life. You can’t avoid money — just like you can’t avoid food. Making bad decisions about your food intake can ruin your physical health, just as making poor money decisions can devastate your fiscal health. Fortunately, the human body has the ability to withstand a lot more abuse than your bank account or credit report. Maintaining good fiscal health takes an ongoing investment of energy, time, and persistence. Awareness and acknowledgment are the first steps to improving your spending habits. If you become conscious of your own tendency to spend money without thinking, you can make better decisions with that awareness. And most likely, if you knew you were making reckless, thoughtless decisions that could negatively impact your future, you wouldn’t do it either. So take a minute to ask yourself: Do you overspend? Maybe the answer is a resounding “Yes!” Or maybe you feel that you don’t overspend, or at least don’t do it regularly. Care to find out? To figure out whether you’re overspending, take our quiz. Click here to download and print the Are You Overspending Quiz If you answered Yes to questions 1 and 2, you’re probably doing really well. However, if you answered Yes to questions 3, 4, and 5, you or someone in your household has spent a lot more than necessary, and this excess spending may be a chronic problem that is keeping you from achieving your financial goals. Regarding the final question, if your spouse or friends jokingly tell people that you have forwarded your mail to your favorite store, you may be an overspender! If they debate about two or more choices, you may be an overspender! However, if you and your spouse or friends can’t quite figure out which store type would be your favorite, maybe you’re not a shopaholic at all. It can be difficult to change spending habits, even if you're aware that these habits cost you money or are irrational, unhealthy behaviors. But it took a long time to get where you are now with your spending, and it is reasonable (and healthy) to recognize that becoming a healthier consumer will also take time, so don’t get discouraged if you're overspending. In the modern classic, The Millionaire Next Door, the authors profiled dozens of self-made millionaires. These millionaires had several common characteristics. One characteristic trait they all shared is that they were thoughtful spenders. Another word for it is frugal. They saved a portion of every dollar they made. Would you rather look like a millionaire or have the financial security of becoming one? Most people can’t have both. This concept is not living within your means, but rather living beneath your means, which means you have money to save and invest.