Are your monthly bills getting you down? Do you struggle to budget for food and clothing? In today's difficult financial climate, millions of people are facing spiralling credit card bills and soaring mortgage costs. It's time to fight back, and take control of your finances by Living Below Your Means!



The key to staying afloat financially is simple, live on less than you earn, and always have money put aside for emergencies. In today's world of low job security and frequent unexpected costs, it's amazing how many families are living paycheck to paycheck, with less than one months expenses set aside in savings. This is very dangerous, ideally every household needs at least six months expenses set aside in an easy to access savings account, but how can ordinary people earning low wages save up enough money to be safe? The answer is to live below your means!

Let us be clear, living below your means does not mean a low quality of living. All to often people mistake high spending for a high quality of life, but quite often the opposite is true. To begin with you need to focus on the unavoidable costs of running a household, Food & Clothing and Housing & Transport. Start with your food bill. Track every item of food and drink that you buy, and then at the end of one week, look over the list and see where you can save. Perhaps buying cheaper brands, or buying an item in bulk. Perhaps by buying more food from the supermarket, and less from expensive stores or eating out. Pay attention to any wasted food, and see if you can cut down on costly ready-meals or trips to the local fast food place.

Once you've cut back on your food bills, pick another essential area, such as utilities. Again, track your costs for 1 week, or if the bills are monthly, divide them down to get a weekly cost, and see what you really need. Are you paying too much on heating or air-con, running it during the day when no-one is home? Do you regularly watch every channel in your TV subscription package, or could you miss off a few? Do the same with travel expenses, fuel costs, clothing and grocery purchases, and you will find yourself saving possibly hundreds of dollars every month on essentials.

Once the essential costs are out of the way, begin looking at non-essentials. Again, track every cost, and think about the value for money of each purchase. Did you buy a DVD that you will only end up watching once? Did you get a new phone when the old one did everything you need? Are you renting a second car that you barely use? It's all about identifying value for money, so you can cut back on the costs of things you aren't getting real benefits from.

Once you've cut back you need to allocate your free money. This is important, unallocated money ends up getting spent regardless of good intentions. Ideally take money you have decided you won't need directly from your account as soon as your paycheck clears. You are looking to do two things; first you need to build up a savings account for emergencies, so look for an easy-access account with a decent rate of interest. Keep this separate, and never use it for paying day-to-day expenses. This is your safety fund, you are buying financial peace of mind with your money, and it's worth every penny.

Lastly, use perhaps half your free money to pay down your debts. Start with the debt with the highest interest, usually any credit cards or car loans, and then move on to your mortgage. If you are lucky enough to be without such debts, if you rent for example, then consider investing in things like energy-efficient light bulbs to cut down on your utility bills. By paying down your debts you will be increasing the amount of free money you have at the end of each week and be able to build up your security fund even faster!