How To Reduce Your Spending

If you have already maximized your household income to the very limit, then the only alternative solution to increasing you budget surplus is to reduce your spending.

The first thing to do is look at your expenses (as detailed in the step 2). Ask yourself the following 3 questions for each category:

* Is this category absolutely necessary?
* If not can we do with out it?
* If not can we substantially reduce our spending?

Once you have identified the areas where substantial reductions can be made, you will need to think of ways to actually achieve your goal.


Below is a list of ideas to help you get started:


* Housing - look for D.I.Y. opportunities and shop carefully for furniture and appliances. Take advantage of genuine sales wherever possible.

* Transport - do what you can to use one car and perform routine maintenance yourself. If you are going to town try to use public transport.

* Utility Bills - make sure you are with the cheapest supplier for gas and electricity. Compare prices and switch online to get your best deal.

* Food - prepare packed lunches for work and school. When purchasing food prepare a list and stick to it. Try to use money off coupons from papers and magazines where possible.

* Clothing - plan your spending in advance and do not over purchase.

* Insurance - shop around for the best deal and make sure you only get the cover your family really needs.

* Entertainment/Recreation - draw up a list of things you and your family can do in the vicinity of your home that are cheap or completely free. Try to stick to a limit on spending money and holidays and book accordingly.

* Savings - open a separate savings account where you can deposit the required monthly allowance for bills that do not fall due on a regular monthly basis or to deposit monthly amounts to help save for a holiday etcetera.