Should You Borrow Against Your Home? By Miriam Engeln, blogger since 2004.

Should You Borrow Against Your Home? By Miriam Engeln, blogger since 2004.

ARUBA life: Why move to Aruba and why to get the hell out! Come to Aruba for sun and fun living.

ARUBA life: Why move to Aruba and why to get the hell out! Come to Aruba for sun and fun living.

4 tips for living on a budget

(So soon you can afford to pay your bills on time and even save money to purchase property)

 

Living on a tight budget can be straining. Setting financial goals and creating a budget are great starting points to making things work on a tight budget, but just as important is developing healthy and smart financial habits. Overspending often adds more stress to your life; the key is to live below your means to give yourself more financial freedom. You can do a variety of things to live on a tight budget.

Create a Budget

• Creating a budget is not always the easiest thing to do, but it is an important step to keep finances in order. Provide as much detailed information as possible on the budget sheet in order to see where money is coming from and where it is going. Include all bank and investment statements, recent bills, and income statements, as well as any other paper containing income or expense information. If some numbers vary each month, use a monthly average. Keep records of income and bills. Break the expenses into two categories, fixed and variable, to give a clear idea of what is an essential expense, like mortgage, rent, car payments, bills and credit cards, and what will vary monthly, like groceries, eating out and entertainment. Your goal is to get the budget sheet to have more income than expenses. This will most likely take some budget adjustments over a few months/ years. If you have a surplus, you can put that money towards a down payment on a property.

Food

• Food is an essential part of life, bit it is often one of the first things people cut back on when having a tight budget. The key to smart food budget management is smart shopping. Coupons and sales are a great start to minimizing the budget, but do not waste food, either. Plan the menu and make the grocery list according to your weekly menu. Also, properly handle the food by freezing it or consuming it before it goes bad. Buying in bulk can also save a lot and mean fewer trips to the store.

Habits

• Developing healthy and smart financial habits is the key to making things work on a tight budget. Pay bills on time. Meeting deadlines will not only prevent service interruptions, it will also save money on late fees. Set up a standing order at the bank or pay bills online automatically to ensure bills are paid on time. For other expenses, set up an "envelope system" that will help keep you from overspending on various expenses each month or pay period. An envelope system is when you designate a letter envelope monthly expenses, like groceries or entertainment, and put a set amount of cash for each category into the envelopes. When the money is gone for a particular category, you have to wait until the next paycheck to replenish and spend in that category. That way, you spend only what your budget allows for in that category.

Basic Money Saving Tips

• Stop spending on fancy coffees, expensive lunches, smoking and drinking, entertainment, and all other items or services that are not a necessity. This might mean canceling the cable, cutting back on cellphone features, take your own drinks and chairs to the beach, and stop smoking. Instead borrow movies from friends, rent books from the library, and pack a lunch every day.

This article is presented to you by Miriam Engeln, working in sales at Century 21 Aruba, tel: (297) 5864242. For real estate inquiries please call or email: miriam@arubahouses.com

 

 

Moving to Aruba

Moving to Aruba