Business and Finance Times

Archive for the ‘Budget’ Category

Is there any sharp line that distinguishes people from being frugal and being cheap? Are these the two sides of the same coin? Well, in my opinion, I don’t think they are. I have met people from all grounds and I have seen people who are frugal but not cheap, and on the other side, people who are cheap but not frugal. I met a girl when I was in my law school. She always followed the absolute rule of not going to the ATM. She took out $40 in the beginning of the week and that was the maximum amount that she will spend in the whole week. At first, I used to admire her kind of approach towards sticking to the strict budgeting principles. Later, I came to know the character flaw behind it. When we went out as a group to have pizza, and she was down to her last $2, I was curious to know whether she declined to go further with us. Nope. She went out with us for the outing. When we had our food and the check came, we divided each of our share as $5. This girl offered the $2 only that she had. The rest of us made the difference. Now, my question is was she both frugal and cheap? Or was she just cheap through and through, both with herself and with others?

During those days, I was in touch with another guy who was saving every penny that he had for the studies in the law school, and he rarely bought more than a hot dog at the corner vendor for his lunch. But when he used to go out with the group, he used to pay more than his fair share. He is successful now and doesn’t’ usually eat hot dogs, but he still believes in saving money even today. He will buy a used furnace from a neighbor rather than get a new one, but he will never act as cheap when he is with others. He is one of the nicest guys I had known so far.

I get pissed off with those types of people who are cheap in the name of frugality. A cheap person will ignore the fact that a ten-dollar meal, after tax and tip, is more than the ten-dollar share and his friends had to pay the rest of the balance because of his tight-fisted ness. In the end, this kind of personality flaw is not about the money. It’s a sign of deep lack of character and this has an affect on the overall personality. The most important thing that is really missing is the

I really admire frugal people and I wish that I can be like one of them. They are the ones with all the good tips on travel discounts. These are those kinds of people who are never afraid of buying used things. When I am out with such type of people who show their care towards me, they will never let my wallet go astray because they are watchful of other people’s money as they are of their own. Truly frugal people are really generous. Remember, the other girl who was with me in the law school and I was talking about her above; she is still not well balanced in her life and she has taken wrong decisions with her money. The more important thing is that she really doesn’t have any friends who can trust on her. Life!!

Month after month, we have been spending on our groceries and it can average to around $400-500. This is spent only on food and dining, and not on household items. For our family of three, I know we can spend a lot less than that.

There are free sites that can help you with your grocery shopping and finding good deals. But unfortunately, for us due to our location, those sites do not have any affiliates with our local grocery store. We don’t subscribe to our local newspaper as it’s too expensive. So, to get those flyers, it means a trip to the grocery store and pick the flyer. Then, we have to come back home, review the flyers and creating a grocery list, and go to purchase items. With our schedule and the time when the flyer comes out, the time doesn’t adjust too well for us. So, here’s what we are trying to do.

Once a month, we purchase all the inventory items of our food. I have made a list of all the necessary items that we will need during the month to make meals and I mark those items that have to be fully stocked up. Then we head to Wal-Mart to do shopping. Wal-Mart has some items on sale that our local grocery store will not usually put. Last time, when we came to Wal-Mart, we had a cart full of groceries for $150. I am not sure if we have ever spent that much on one trip before.

Now, we have the normal items that will stay for the whole month. Then it’s the small weekly trip to the grocery store to buy fresh fruit, milk, bread and meat on sale. We don’t buy fresh meat from Wal-Mart anymore because it can get quite expensive for us and our budget is not to exceed $50 each trip during the weekend. So, here’s what we have spent at the end of the month.

$150 + 50 + 50 + 50 = $300/month

So far, it is working awesome. One major problem that we faced was that we were making too many trips to the local grocery store during the week. All those little trips can add up quickly and result in buying items that we really don’t need like frozen pizzas for a quick dinner. This is an unnecessary expense that can fully be avoided. Once we have limited the number of our trips, we are more focused with our purchases and we are getting a little more creative with our meals to use what we have and saving money from our budget.

Limiting our grocery store trips is challenging us and I like it. After some time, I would like to plan our menu also. I used to do that before and this saved a lot of money. But because of my work, I couldn’t devote much time on it. I will have to start doing it again.

The main thing is about saving money. There are many strategies of executing it. You have to spend some time looking at your spending and figuring out the plan that works well for you.