I wanted to discuss this question with expert bargain-hunters as a benefit for our readers who are adjusting to new circumstances. Maybe living frugally is a decision that is borne out of necessity for you rather than choice. I’ve spent some time interviewing frugalistas that have something to say about that topic. For those of you who are loving your financial choices and enjoying life because of them, read on and enjoy the encouragement – you’re doing the right thing! And for those of you that are relatively new to this, I think you’ll appreciate the useful tips we’ve gathered in this series.
One of the people I turned to for advice is Danny Kofke, author of How to Survive (and Perhaps Thrive) on a Teacher’s salary. Danny lives in Georgia with his wife and two daughters. They live (and thrive) on Danny’s teaching salary. I found his perspective to be inspirational. I’ve broken down our interview into four segments. Today’s post starts with Danny’s advice to begin with writing down your expenses. This process can be painful and take discipline, but Danny says that:
it is necessary in order to get control of your finances – if you don’t where your money is going, how can you have it work for you? I have friends that never balance their checkbooks and get hit with overdraft fees every month. That is like taking $30 and throwing it out of your car window. If it is too difficult to write down purchases at the time you make them, I suggest you have a basket in your house where you can put all of your receipts. At the end of each day look at these and balance your checkbook and write them down. This should take maybe ten minutes at the most.
Doing this daily is crucial according to Danny. People get into trouble when they avoid doing this on a daily basis. Waiting too long makes purchases add up and it seems like too much work to keep track of them.
Does this chore of keeping track of your expenses lead to increased happiness? Absolutely yes according to Danny:
I feel that being meticulous with our money actually increases our fun. We know that whatever we buy we can actually afford. We never have buyer’s remorse because we have planned for our purchases. There are a lot of people that feel great Christmas shopping but when January comes and the credit card bills start coming in, they get depressed. We never experience this because we know exactly how much we have to spend and spend only that amount. (Emphasis mine).
I know how it feels to carefully plan Holiday gifts and then “get into the spirit” and spend more than we have. It has robbed us of the joy somewhat because we knew the bills would be too high in January. But even everyday expenditures add up quickly, so it is important to begin the daily exercise of writing down what you spend so you can know exactly how much you have and can enjoy spending that much or less.
You can find out more about Danny Kofke and his book at his blog: http://www.dannykofke.blogspot.com/
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