I want to cut back on spending, but I need the money... help! - WICU12 HD WSEE Erie, PA News, Sports, Weather, Events

I want to cut back on spending, but I need the money... help!

Updated: July 1, 2010 09:57 AM EDT
©iStockphoto.com/Roman Milert ©iStockphoto.com/Roman Milert

By Karen Goodfriend


Q: I wanted to cut back on credit card charges, but now I'm always at the ATM. How can I find a balance?

A: If you're prone to impulse purchases or surprised by high credit card bills, switching to cash is smart. Still, you need to set a budget to help limit your spending and provide you with enough to cover your needs. Sticking to a budget can also help cut down on ATM trips and any fees that apply.

Start by writing down what you buy every month, plus how much it costs. This includes groceries, gas, dry cleaning, shopping, entertainment and coffee runs, but not mortgage payments or other set bills.

Next, decide whether each purchase should be a credit or cash expenditure. In general, put non-negotiable costs like groceries and gas in the credit category and discretionary spending like shopping and entertainment in the cash group. But remember to take your spending habits into account when divvying up your list. If you have trouble sticking to your budgeted amount for groceries, set aside just enough cash and proclaim the supermarket a credit-free zone. This will force you to make smart choices so you stay on budget.

After tallying up what you need in cash each month, withdraw only a percentage of it each week. Then tell yourself you can't hit the ATM again until your next planned visit. You'll start thinking twice about what you buy -- and you should end up saving a bundle.

Copyright (c) 2010 Studio One Networks. All rights reserved.

Karen Goodfriend is a certified public accountant and personal finance specialist in Los Altos, Calif. She is also a member of the American Institute of CPAs' Financial Literacy Commission.

INFORMATIONAL DISCLAIMER The information contained on or provided through this site is intended for general consumer understanding and education only and is not intended to be and is not a substitute for professional financial or accounting advice. Always seek the advice of your accountant or other qualified personal finance advisor for answers to any related questions you may have. Use of this site and any information contained on or provided through this site is at your own risk and any information contained on or provided through this site is provided on an "as is" basis without any representations or warranties.
Powered by WorldNow
3514 State St. Erie, PA 16508
Newsroom: (814)454-8812
Toll Free: 1(800)454-8812
Business offices: (814)454-5201
Share Stories
Submit your stories to our site!
Share Photos
Share your photos in our community galleries
Mobile Site
Be sure to stay constantly updated with the power of WICU12 and WSEE at your fingertips
Free Android App
Free iPhone App
Free iPad App
Storm Tracker App
All content © Copyright 2000 - 2014 WorldNow and WICU. All Rights Reserved.
For more information on this site, please read our Privacy Policy and Terms of Service.
                   WICU/WSEE - 3514 State Street Erie, PA 16508 - (814) 454-5201 - info@wicu12.com