This month Suze Orman doesn’t take reader questions. Instead, she writes about 12 things that can break your budget. She understands when people try to budget and then wonder where the heck all their money went. Here are Suze’s budget breakers:
- “Clothing bought on sale.” Maybe you’re thinking, “What??? But I got a deal!” Suze’s point here is that if you aren’t planning on buying clothes, but you’re tempted to spend because there’s a sale, then you’ve spent money you didn’t mean to (not to mention the question of really needing the clothes).
- “A kitchen cupboard filled with unused gizmos.” Are you really using all the kitchen gadgets and electronics that take up space on the counter? If not, clear them out!
- “A messy desk.” (call me guilty….it’s cleaner, but not fully neat) Financially, Suze says that if you have a messy desk with stacks of unopened bills and papers and catalogs, it’ll just make you feel anxious (I can attest to that). Suze believes that “paperwork represents money” and you should “show respect for yourself, for your money and for others by facing that clutter, not hiding from it.”
- “Your well-stocked refrigerator.” Do you end up buying a lot of food, only to throw it out because it spoiled before you could get to it? That’s just wasting money–Suze says maybe even $1000/year. She recommends going to the store every 8 days instead of once a week, and on that 8th day, use up what’s in your fridge. You’ll make fewer trips to the store and save some money.
- “Your morning cup of coffee.” Oh, look! My favorite money-saving tip! Cut back on the fancy coffee drinks! (I don’t drink coffee, so this one is pretty worthless to me)
- “Unopened statements for your retirement.” If you don’t pay attention to what’s going on with your retirement money, you’re messing up your future.
- “A bathroom cabinet filled with abandoned shampoos, hair gels, creams , lipsticks and nail polish.” Suze treats the bathroom like the fridge: Use it or get rid of it! She recommends trading products with friends with it’s hygenically safe to do so. Even if it’s an almost-full bottle that you’re not using and you don’t want to use or toss it, you should toss it, no matter how guilty it makes you feel. That way you know what throwing money away feels like.
- “That mason jar brimming with spare change.” Suze doesn’t like the change jar because that money isn’t working for you. Get it in the bank and make it earn some interest, or put it against your credit card debt! Me? My change jar isn’t that big, it takes forever to fill, and I get it in the bank once it’s full. That way it’s somewhere around $30, which makes me feel like I have some cash there. Bringing it in when it’s not full makes me feel like I’m stressing about money too much.
- “A big bag of freshly dry-cleaned clothes.” Basically, this one asks if you really need to dry clean your clothes so often. Try pressing them yourself and see if you can stretch the wear.
- “A credit card with perks that go to waste.” If you’re racking up points and miles and never use them, either don’t bother having that card, or switch to one that gives you a reward you want to have.
- “Too many toys in the playroom.” Keep only the toys your kids play with. This actually will help kids learn about money because it shows that you should spend money only on the things you value. [I don't have kids, so this tip also doesn't help me, but I've heard/read about the crazy amounts of toys children have. Now, I had a good amount of toys growing up, but it sounds like things have gotten totally out of control. Is that true?]
- “A tax refund check.” Are you getting a huge refund? You just gave our country your money, and you don’t get any interest! You should think about changing the number of allowances on your W-2. Me? I like to get a little bit of a refund. Not $2000 or anything that big, but a little money back is nice because that means we don’t have to suddenly scrape together money to pay the IRS. [and, admittedly, if I'm getting a little bit back, I feel like I've helped the country with the budget deficit by loaning them the money for a while]. Suze probably wouldn’t like my attitude, but it works for me, and since I’m saving anyway, I’m OK with bending this one.
Finally, there’s a sidebar on “The Biggest Budget-Wrecker.” Know what it is? Too strict of a budget. You know you’ll have fixed payments every month, but some months you’re going to have some unexpected outlays, and other months you’ll have nothing. If you have some give and take with your budget, you won’t be so frustrated if you can’t stick with it.
Also, plan your budget yearly, rather than monthly. Take what you spend on Christmas and spread that over 12 months. Same goes for any yearly memberships, subscriptions, etc. That way you’ll be prepared for these big outlays that you know are coming.
