In a weak economy saving money is imperative, so being vigilant about monitoring your expenditures and service consumption can help curb overspending. If you wait too long to adjust spending habits and limit consumption of services, your bills may get out of control quickly.
We are bombarded with commercials about credit checks and monitoring that warn us about the dangers of ignoring our credit scores. If we were as vigilant about monitoring our available credit, spending, and even cellular data consumption, we could nip financial problems in the bud before they get to the point where they affect our credit scores. If you keep a watchful eye on your recurring bills and monthly expenditures, you can find ways to save or pay off existing bills quicker.
Create a Budget Spreadsheet to Monitor Bills
Creating a monthly budget is one of the oldest tricks in the book, but it is simple and effective. When I was hired by an organization that pays monthly, I thought it would be a nightmare, but it turned out to extremely positive for my finances. Regardless of how many times you get paid per month, you need to know how much money you have left after all of your bills have been paid.
Gather all of your bills and create a spreadsheet that automatically calculates what you spend on credit cards and bills every month and how much money you will have left after your bills are paid. When you look at your bills in the spreadsheet each month, you will have a better idea of where you are spending too much. Once you know where the problem spending areas are, you can take measures to change them.
Track Monthly Spending with Mint
You don’t need to purchase expensive financial management software to track your expenditures. Mint.com is a free service that aggregates all of your checking, savings, investment, credit card, and loan account information so you can track your spending and earnings in one place. Mint allows you to categorize all of you monthly expenditures, and can produce charts and graphs to illustrate your spending trends. It is an extremely useful and secure tool, because Mint can only read information from your online accounts, but cannot make any changes to your online accounts.
Reduce or Eliminate Unnecessary Recurring Costs
The quickest way to reduce monthly expenditures is to reduce the ones you can control, and eliminate unnecessary spending. We all have the power to reduce our utilities by remembering to turn off lights, installing an automatic thermostat, washing clothes in cold water, and only running the dishwasher when it is full. If you contact your local power, gas, and water providers, they will even give you conservation tips.
Cable, satellite, and phone bills are a slightly more touchy subject for most people. Even when times are tough, we hesitate to give up cable or reduce our phone usage. If you live and work in areas with good cellular phone coverage, it may be cheaper for you to get a cellular plan with more minutes and eliminate a land line or VoIP line at home. If you live in an area with poor cellular coverage (on all or most carriers), it may be in your best interest to reduce your cellular plan and add a land or VoIP line at home. A lot of us are also guilty of paying for way more cable or satellite channels than we actually watch. You may be able to eliminate your cable or satellite bill and replace it with Netflix, Hulu, and Amazon On Demand.
Monitor Data Usage on Accounts With Caps
Now that AT&T has eliminated their unlimited data plans for new smartphone users and Verizon is planning to follow suit, monitoring your data usage is more important than ever. Log into your AT&T account and click on Usage & Recent Activity to monitor your data usage throughout the month. Even if you are on the 2GB plan, browsing the real web (not the mobile web) on any smartphone, downloading apps, and downloading music can add up quickly. If you know that you may run out of data during the month, you will have time to adjust your budget to accommodate it, or curb your consumption before it becomes a problem.