The reality for most of us after divorce is that there is always less money and often times less means not enough. This month’s guest post from money expert Suzanne Cramer tackles this tough situation:
You’re responsible. You’ve always saved your money, paid your bills, held down a good job. You’ve made a budget and stuck to it—and if you splurged now and then, you were always able to pay it off. But suddenly, something changed. In the aftermath of divorce it can be tough to keep your new budget under control and plan for the unexpected life always throws your way. For example: Maybe interest rates skyrocketed. Maybe you’ve unexpectedly joined the ranks of the 9.1% of Americans unemployed right now. Maybe you thought your family could get by on one income, or maybe you got a little lazy when it came to your budget.
And so here you are, suddenly struggling with your finances. We understand. It happens to lots of people. But don’t waste time beating yourself up—get busy fixing the situation.
First of all, it’s important to admit what’s happening. Many people don’t like to admit they’re having trouble with their finances, especially when they’ve never struggled with money before. There’s shame and stigma attached to money troubles—but there shouldn’t be. Often, financial trouble is the result of an outside factor (such as your divorce) that couldn’t be predicted. So even if you’re telling yourself you have it all figured out, that you’re reading this article out of curiosity, or for a “friend,” take a good hard look at your finances, take a deep breath, and take control.
Once you’ve admitted you’re struggling with your finances you can start thinking clearly about a plan to get out of it.
Let’s start with the day to day stuff…
Every Little Bit helps
When your budget is stretched thin even small changes can make a huge difference. Start with the things you have some control over.
Filling up
- Shop around for the best gas prices. Enlist the help of intelligent websites that track local gas prices. At GasPriceWatch.com, for example, you can view area gas prices based on your zip code. The site also offers gas purchasing tips, including the best day and time to purchase gas, which they claim is Wednesday morning. In addition to monitoring gas prices online, see if there’s an application for your smart phone that identifies the cheapest gas in your area.
- Use public transportation. According to the American Public Transportation Association (APTA), riding public transportation saves individuals, on average, $9,904 annually and $825 per month based on the March 4, 2011 average national gas price of $3.47 per gallon, reported by AAA, and the national unreserved monthly parking rate.
- Condense your trips and be a smart driver. AAA reports that more than 70 percent of the trips consumers take are dedicated to personal/family and social/recreational events, so wherever possible, combine errands into one trip.
- Maintain your vehicle. If you don’t know how to keep you vehicle running optimally, there’s never been a better time than the present to learn. Start by keeping a regular maintenance schedule. Your vehicle’s manufacturer can provide you with a recommended service schedule if you don’t have one already.
Staying warm
As the temperature plummets, it’s tempting to crank the thermostat and settle in for a season of toasty toes. But don’t let the weather bully you into high energy bills. You can stay cozy without blowing your budget by finding some creative ways to keep warm.
- Stop drafts. Drafts are sneaky little energy suckers, bringing down temperatures and raising costs. Weather stripping helps, caulking helps, even a blanket laid down at the bottom of the door will help. However you do it, make sure to plug those holes.
- Consider space heaters. A furnace actually uses a lot more electricity than a space heater. Plus, space heaters allow you to concentrate warmth on the rooms you frequent most. Keep the furnace as low as you can and use a few space heaters in key areas (bedroom, living room) to watch the savings add up. Be sure to close the door on rooms you’re not using, so they don’t draw warmth from the rest of the house. And to keep your furnace operating at maximum efficiency, make sure to change the filter periodically. A clean filter is much more efficient-and inexpensive-than a dirty one.
- Layers, layers, layers. It may seem odd to bundle up just to stay inside but you’ll feel pretty clever when you get your heating bill. Pile on the socks and long underwear this season and keep the thermostat down. Don’t forget a hat! Much of the body’s heat loss occurs from the head, so cover it up.
- Bedtime savings. When you’re ready for bed, try sleeping under a down comforter, which can keep you twice as warm as conventional blankets. Another tip is to fill a hot water bottle with almost-boiling water. You’ll be surprised by how warm these low-tech methods will keep you.
Cell Phones the Budget Killer
We all love to talk, text and email from our phone but do you know what it’s costing you? By following theses five tips you can real in the savings.
- Review your usage. Are you chatting at night? During the day? On the weekend? Track when and whom you’re calling and find a plan to suit those habits.
- Bundle your options. If you’re big on texting (20 percent of us average 10+ texts per day), don’t pay for each message. Make sure texts are included in your rate.
- Consider a prepaid plan. This is a worthwhile option if you use fewer than 200 minutes per month.
- Skip the insurance. It’s just not worth it: Insurance can run you $8 per month and you’ll still be responsible for a deductible (usually $50).
- Track your international calls. If you often call overseas, investigate carriers that specialize in international plans. You’ll save tons over domestic carriers.
We all know money doesn’t grow on trees so it’s important for us to work with what we have. One of the easiest ways to bring your budget back to the red is to make small changes like the ones listed above. I promise you, you won’t even miss them and your budget will thank you.