Family Vacations on a Budget
Family vacations are sometimes hard to schedule because it requires a big budget. Most of the time, we parents, set aside money for more important things like education, foods, bills, etc rather than saving for a vacation. But there are family vacation ideas that are in a budget and at the same time, be enjoyable for your family as well.
Why not organize a vacation in your relative’s place for a couple of days? This idea is really inexpensive for you don’t have to make hotel accommodations anymore. You just have to make sure that you get along well with these relatives, and of course, they allow you to stay with them. This idea could even tighten your relationship with them.
Another suggestion is a camping vacation. This includes hiking as well. This could be a lot of fun for your kids especially if they love nature. Camping is always one of the best ideas for its cheap but very educational for it builds self reliance, confidence, and boost your child’s self esteem. This idea doesn’t require a high budget because all you will need is a tent. Again, you could just save the hotel fee and allot it for your food budget instead.
Vacation doesn’t necessarily mean that you have to go to other place away from your home. You can simply have a vacation just by staying home for a week with your family. Take this chance as a bonding time with them. You can simply watch in your home theater with your kids while eating homemade pop corn and pizza. Take this time to teach your kids your very own recipe. Also, don’t forget the board games and hide and seek. You can also play backyard table tennis or simply jump to the pool if you got one.
There are a lot of ideas you could consider to take your family for a vacation, just be creative and use your imagination. Also, don’t forget to ask for your family member’s ideas as well. They might have the best possible way to spend your vacation in a budget.
9 Steps to Save Money on Groceries
Not everyone wants to be a grocery guru or coupon queen. The following list will help you save money on your grocery bill without cutting coupons and watching for the latest & greatest sale prices. While this works and it is a great way to save money, not everyone has the time or interest. This article will show you ways you can make the best use of resources so you are not wasting food, and how to cut down on trips to the grocery store.
- Start by making a list of dishes you like to eat. Think back on what you have eaten the past couple of month, or meals that you really like that you haven’t had in a while.
- For each meal, make a list of ingredients you will need to make the meal.
- For each ingredient, put a number between 1-4 representing how long the ingredient generally lasts. For example, if the menu calls for fresh vegetables, put a one next to the vegetables. If the menu item is something like spaghetti, noodles and spaghetti sauce can store much longer so you can put a 4 next to these ingredients. Based on the numbers in your ingredients, use the lowest number and write that next to your meal. This number will help in planning later.
- Determine how often you want to go to the store. This will vary by family. Some families can manage to go to the store once per month. Others go every other day. It will depend on your circumstances. For example, if your family goes through 4 gallons of milk in a week, and that is all the milk you can store in your refrigerator, you will need to go each week. I would guess that most families can get by going to the store every two weeks. The less trips you plan to make, the less likely you are to overspend.
- Raid the fridge. Go through items you currently have. Make note of items that may go bad or expire soon so you can be sure to use them in your meal plans.
- Plan your meals. Print out a blank calendar. CalendarsThatWork.com has many calendars you can print out for free. Using your list of meals and make a plan for the time period you have specified in the previous step. So, if you have planned to go to the grocery store every two weeks, plan two weeks worth of meals. Us the numbers from step 3 above to help you plan. So, if you have a meal that contains ingredients that go bad after only one week, put that meal in the first week of your plan.
- Create your shopping list. Using your meal plan, determine the ingredients you are lacking in order to make each meal. Get the adequate amount of ingredients for each meal.
- Buy your groceries.
- Stick to the plan! You may not feel like eating something you have planned. If this is the case, try swapping out meal days. Avoid the temptation to eat out. If you want to eat out, put that in your meal planning before you go shopping.
Other useful tips:
- Never go shopping on an empty stomach. This is when you will tend to splurge. Eat a hearty meal before doing your grocery shopping.
- Stay within a budget. Set a limit on how much you want to spend on food each grocery trip. Plan you meals according to the amount you have budgeted to spend. Put a set amount of cash in an envelope each pay-check you get in order to prevent overspending on your groceries. You may also make use of envelope budgeting software for more convenience.
- Buy non-perishables in bulk. As you continue to follow this plan, you will find some meals are cheaper than others. If you eat a particular meal on a regular basis, you may find it cheaper to buy the non-perishable ingredients in bulk.
Remember, when you fail to plan, you plan to fail. A little bit of planning ahead of time can stretch your dollar a great deal and help you save money on groceries and eliminating the need to through out expired food.
Envelope Method of Budgeting
There are many different ways to budget your money. For those who lack will power or often go over budget, methods like the envelope method work wonders. This method teaches budgeting by strictly cutting off your resources and allowing you a very small amount of money to work with each week. It sounds harsh, but by the end of just a few months you will be living like you were never on a budget and saving a lot of money at the same time!
The Envelope System, popular years ago, involved setting up envelopes, allocating your monthly income to expenses, and then putting the required cash into each envelope. The term Zero Based Budgeting came about because all money was allocated to envelopes and therefore “budgeted to zero” each month.
One of the best ways to manage your budget is to use The Envelope System. This budgeting method is so effective that it has become one of the recommended tools for personal finance.
The Envelope Budget System in Eight Easy Steps:
1. Start by tracking your daily expenses. It just takes a few extra minutes each day.
2. List down all you monthly expenses. Consult your daily expense notebook to check some items which you might have forgotten.
3. Group the list into categories. Make sure that you include everything. You can start by grouping them into general categories such as Shelter, Food, Clothes, Utilities, Transportation and Personal.
You can also choose to further divide them into subcategories until you have a comprehensive map of where exactly your money goes every month.
4. Get some envelopes and label each of them with the expense classifications you defined. When you’re done, add one more envelope and label it, Pay Yourself First.
5. Next, create a budget. Distribute and allocate your current income into the envelopes. Make sure that you fill in the Pay Yourself First envelope before the others.
6. Keep your envelopes in a safe and secure place.
7. Plan your day ahead and bring the envelope which you might need for your expenses. You can choose to bring just a certain amount and not the whole envelope for security purposes.
For example, if you’re planning to go to the mall with friends, instead of bringing your Food Envelope, which usually contains a large sum, just get a few bills. Do the same for your Transportation and Personal envelopes.
8. At the end of the month, whatever is left in the envelope is carried over and added to the next month’s budget. That’s why it is important not to spend everything in the envelope, so that you can save up for bigger purchases and unexpected expenses.
For example, if your monthly clothing budget is just $20.00, then you will be inclined not to spend it if you want to buy a $40.00 pair of jeans next month.
Additional Notes:
• Put your receipts into the envelope from where you took the cash from. That way, you’ll be able to easily track exactly where your cash was spent on.
• Instead of carrying over what’s left towards next month, you can also choose to deposit the money left into your savings account.
• It is recommended that you use your income from last month for your current month’s expenses. All your earnings for the current month should be kept and saved for budget allocation next month. If this is not possible then try to adjust your spending habits until you have achieved this.
• Try not to “borrow” money from other envelopes. You should discipline yourself to spend the allocated money only for its assigned category.
Remember that this is a dynamic process; the Envelope System entails constant planning, tracking, analysis and adjustments to your budget allocations and spending habits until you have successfully gotten yourself out of debt and comfortably living within your means.
And lastly, the best part of doing this envelope system is that you don’t have to worry much about saving money because your Pay Yourself First envelope is automatically doing that for you.
These are few advantages of the Envelope System:
• Those who do better with the physical representation of money can visually see where the money is going.
• You can’t over-spend with this system. If the envelope is empty the spending is done.
• It eases the temptation to dip into savings. Since you’ve already allocated the money there, you have to make the most of your play money
One thing to keep foremost in your mind when setting up your family’s budget is to make it a workable budget for you. Don’t make it to strict that you are setting yourself up to fail. If you slip and it doesn’t work out, try again next month. Don’t give up! All new things take time and patience to learn.
References:
http://ezinearticles.com/?The-Envelope-Method&id=257722
http://www.debtsteps.com/envelope-system.html
http://fitzvillafuerte.com/envelope-budget-system-tutorial-video.html
Zero-Based Budgeting
A zero-based budget is one where your total income minus your total expenses equals $0. In other words, it forces you to assign every dollar of income to an expense (or savings) category. In business, a zero-based budget starts from a “zero base” and every function within an organization is analyzed for its needs and costs. Budgets are then built around what is needed for the upcoming period, regardless of whether the budget is higher or lower than the previous one.
Zero-based budgeting is basically putting a name to every dollar that comes your way. It starts with your income side of the equation, and line by line, the total subtracts as you allot amounts to each category, until you are down to zero.
The term “zero-based budgeting” is sometimes used in personal finance to describe the practice of budgeting every dollar of income received, and then adjusting some part of the budget downward for every other part that needs to be adjusted upward. It is more technically correct to refer to this practice as “zero-sum budgeting”.
Zero based budgeting is an alternative approach that is sometimes used particularly in government and not for profit sectors of the economy. Under zero based budgeting, managers are required to justify all budgeted expenditures, not just changes in the budget from the previous year. The base line is zero rather than last year’s budget.
Zero based budgeting also refers to the identification of a task or tasks and then funding resources to complete the task independent of current resourcing.
Advantages of Zero-Based Budgeting
- Efficient allocation of resources, as it is based on needs and benefits.
- Drives managers to find cost effective ways to improve operations.
- Detects inflated budgets.
- Useful for service departments where the output is difficult to identify.
- Increases staff motivation by providing greater initiative and responsibility in decision-making.
- Increases communication and coordination within the organization.
- Identifies and eliminates wasteful and obsolete operations.
- Identifies opportunities for outsourcing.
- Forces cost centers to identify their mission and their relationship to overall goals.
Disadvantages of Zero-Based Budgeting
- Difficult to define decision units and decision packages, as it is time-consuming and exhaustive.
- Forced to justify every detail related to expenditure. The R&D department is threatened whereas the production department benefits.
- Necessary to train managers. Zero-based budgeting must be clearly understood by managers at various levels to be successfully implemented. Difficult to administer and communicate the budgeting because more managers are involved in the process.
- In a large organization, the volume of forms may be so large that no one person could read it all. Compressing the information down to a usable size might remove critically important details.
- Honesty of the managers must be reliable and uniform. Any manager that exaggerates skews the results.
How to create a zero-based budget?
A budget should more or less have the same categories each month, even if you don’t always fill those categories with money. The main types of categories you should have are:
- Income
- Regular expenses, and
- Irregular expenses
Make sure and account for any type of income, not just your paycheck. As an example, my categories under “income” are:
- paycheck
- book advance
- gift received
- blog
- surplus from previous month
- work advance, and
- work reimbursements
Your regular expenses are pretty much what you think of as expenses — utilities, rent or mortgage, groceries, entertainment, and the like. You should also include your allotment for whatever step you’re on — your debt snowball if you’re on step 2; contribution to savings if you’re on step 3.
And don’t forget free spending money. Give yourself a set amount of cash you get to keep in our wallets and spend on whatever we choose. It’s not much money, but it’s enough for a coffee here and there, a magazine when you see one, or whatever. It curbs your appetite for random spending, and it helps you keep to the budget.
It’s important to plan for irregular expenses as well — these are funds that you don’t need each month, but you want to set aside for them regularly so that you have enough cash when you need it. These are also called sinking funds. Some of our family’s sinking funds are:
- books
- Christmas
- clothing
- gifts and holidays
- haircuts
- medical (insurance deductible)
- vacation
- work expenses
Planning Your Budget
If you don’t work from a budget, I encourage you to do so. In a way, you already are, you just may not be aware of it. Your money’s going somewhere; writing it down into a budget form simply allows you to premeditate where it should go. A few tips as you prepare:
• Use a tool that works with your style. A pen and paper might be more your style, but there are budget-tools site in the internet that you can use— it doesn’t really matter.
• Don’t expect it to work perfectly the first time, or at any time. This is an easy mistake, and one that can cause you to think you’re doing something wrong. You’re not. It takes awhile to get the hang of knowing how much money to allot for different line items, and there are plenty of times when your needs change mid-month. Stay flexible.
• Work with your pay periods. If you get paid more than once a month, perhaps it’s easier if you create a different budget for each paycheck, setting aside a percentage for those monthly bills. Do what works for you, so that you’ll do it.
• Don’t be under-specific, but don’t be too specific. It’s easy to have a subcategory for every single need. It’s also easy to generalize. Find a happy medium.
• Account for everything you’re spending, and give it a name. Don’t have a category called “miscellaneous.”
So the next question to consider is – if you were to write a zero-based budget for your family every month, would you keep track of it? Do you just set the paper aside and hope for the best? Do you walk around with it in your purse, analyzing every single number until you’re cross-eyed walking around Target and scared to death of putting anything in your cart?
I encourage you – prepare a zero-based budget as part of your home management every month. And then regularly, enter your expenses to stay on top of how well you are sticking to your budget. As the month progresses, you can see how well – or not so well – it’s working, and tweaks it from there. It doesn’t take much time when you stay on top of it.
This is also infinitely easier to do when you have a smart, simple tool that subtracts expenses from your budget as you record them. I prefer a tool that’s as light and easy-to-use as possible. No bells and whistles that I really don’t need for everyday family finance management. Try the budget tool of Inzolo.com. It’s the simplest way of budgeting your money online.
REFERENCES:
http://en.wikipedia.org/wiki/Zero-based_budgeting
http://www.investopedia.com/terms/z/zbb.asp
http://www.gettingfinancesdone.com/blog/archives/2006/08/how-to-create-a-zero-based-budget/
http://www.accountingformanagement.com/zero_based_budgeting.htm
http://simplemom.net/zero-based-budgets-for-the-home/
