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So, I’ve decided to improve my finances. Now it is time for work!
I’ve always known that having an emergency fund is important so you can brace yourself from a financial disaster when life throws a curve ball at you. I read that over and over everywhere but admittedly, this only dawned on me when I finally came face to face with a real financial struggle. It was hard and I don’t want it to happen again.
So, I figured, I should start this financial road trip with an emergency fund of $3000.
The big question, though, is HOW will I be able to build this emergency fund when I have a small baby and as a stay-at-home mom with a small and unstable income?
I love reading finance blogs and here are some tips I’ve learned from other bloggers on how to save money when you barely have enough money to start with. I hope these tips will help get me somewhere financially by the end of the year as they help you as well.
1.Evaluate expenses and eliminate financial leaks
We all have expenses but not all of our expenses are necessary. Some expenses may even seem too little or insignificant but when accumulated over time, they actually eat up a huge chunk of your budget.
For example, when I was working 9-5, I would spend money for lunch and coffee every single day. These are expenses that could easily be cut down or eliminated if I brought my own lunch or coffee brew to work. If you do the math, store-bought coffee can cost you at least $700 per year which you can easily add to your emergency fund.
If you are able to plug these spending leakage, you will be able to free up some money for your savings.
But I admit, our household expenses need some work.
Here are some areas that we need to evaluate or change to reduce or eliminate financial leaks. You might want to evaluate the following expenses as well as these may be draining your money away.
- Phone Plan
We are currently paying $200 for four phones and one of which we don’t even use. We are already talking about switching to another provider to save 30% of our current bill. That will save us $720 per year!
Tolls may not be an issue if you live in the U.S. but here in Puerto Rico, tolls suck money! When I was working 9-5, I would spend $20 for toll per week and that’s $960 per year! You have no choice if that’s the only way to go to work but it becomes a financial leak if you take toll roads just to go shopping.
To save money on toll, we need to schedule our grocery shopping only once or twice a month instead of weekly. This would save us $96 per year.
Groceries can become a financial leak if you don’t plan your shopping wisely. To save at least $50 a month, we need to do more bulk buying of non-perishable items.
I should make it a habit to make a list of items to buy before going to the store and stick to the list we don’t buy unnecessary items.
Planning is particularly more important for perishable items to avoid throwing away food.
- Taxes and Interests
Most people don’t realize how much taxes can cost them if they don’t pay them on time. Although the IRS offers an installment plan to pay your taxes (which is a relief if you don’t have the money to pay it in full), this payment method can cost you more as you are still incurring penalties and interest for each month that the debt is not paid in full.
The best way to deal with your taxes is to always set money aside for them as soon as you get your pay.
Electricity is expensive in Puerto Rico as the island only relies on fuel for energy. Added the VATs, it can get really hefty if we don’t use energy wisely. We’ve invested in energy-efficient lights as well as solar lights to lower the cost, but I think we can still further lower the bill by planning meals to reduce using the stove or eliminating energy wasters by simply unplugging appliances when not in use.
- Bank or ATM Charges
These are ridiculous unnecessary charges. Switch to another financial institution if your bank doesn’t have conveniently located ATMs.
Can you live without cable tv? As for me, I’d rather not have cable at home because I really don’t watch TV that much and I’d rather do something than sit in front of the TV and munch junk food. You can save at least $300 if you cut cable and also save yourself from pigging out if you are like me who likes to eat while watching a show.
Savings goal from financial leaks: at least $100 per month / $500 for 5 months
2.Make a Budget.
No matter how much you make, having a budget is important. A budget is basically your spending plan and it ensures that you will have money for the things you need or are important to you.
I suggest that you identify your financial leaks first before you make a budget. If you can plug your spending leakage or reduce them, then you should be able to have extra money to work with for your spending and savings plan.
I am a fan of outsourcing certain tasks so I can focus on more important things. I do that for my writing business, sometimes but for certain personal needs such as hair and nail care, I’d rather do them myself. A haircut (with blow dry) can cost at least $40 and more for other services such as hair treatments. I’ve learned how to cut my own hair by just watching tutorials on YouTube and believe me it’s not really that difficult.
I am not saying you have to give up all your little luxuries in life but if you have a tight budget and want to save some money, you can just DIY certain things and keep the money instead.
Apart from hair and nail care, here are some other things you can DIY to save more money:
- Home maintenance
- Home cleaners such as detergent
- Home organizers or decorations
- Clothes (altering old clothes)
- Kitchen items
Savings goal from DIY projects: $50 per month/ $250 for 5 months
4.Find FREE Money.
You read me right. Find free money. I never thought there is such a thing as free money, but there still is. This free money comes in the form of gift cards, welcome bonus, cash back, or cold cash. Here are some of the free money sources I’ve started using and are yet to try.
By the way, I received a $10 welcome bonus on my first purchase and here’s the proof,)
- Swagbucks – Receive $5 bonus if you sign up here. ( I missed the $5 bonus but I earned over 300 Swagpoints /$3 value for simply using the site three times.)
FREE Money Sites I am yet to try for the rest of the year :
MyPoints- It’s another cash-back site that lets you earn rewards by shopping online and printing coupons. I am going to try this site for coupons.
Ibotta- I can’t wait to use this site because it is affiliated with three of the stores (Walmart, Kmart and Walgreens) we go to at least twice a week (because we live close by!). I can finally get free money from all the purchases we make at these stores without having to worry about shipping fees.
If you sign up here, you get $10 free when you make your first purchase. With Ibotta, you also make $5 per every friend you invite to use it + cash back on making a purchase. Simple!
UPDATE: I used Ibotta a few days after writing this post. As of this writing, I have received $16 from my grocery purchases in Walmart.
Savings goal from cash-back sites: $100 for 5 months
FREE money for moms with small babies:
Women, Infants and Children (WIC) Food and Nutrition Service
WIC gives free nutrition and food packages ( baby food, vitamins and formula milk) for the following individuals:
- Women- pregnant, new mother, breastfeeding mother with up to a year old baby
- Infants – up to a year old
- Children – up to 5 years old
In Puerto Rico, you have the option to receive cash instead of goods/supplies and that’s money you don’t have to work for. I will definitely look into this and apply as soon as possible.
Savings from WIC for 5 months: At least $200 worth of goods
5.Don’t get sick!
Health is wealth so for the rest of the year, I’ll prioritize my health. The good thing about investing in your health is that it doesn’t cost you much but the return is so much more.
6.Make money from home.
The ultimate solution to saving money is to increase your income. Okay. I know what you have in mind. You’ve quit your job to become a stay-at-home mom so why would I advise you to “work” again? I get you.
But there are many ways to make money from home (so you can still take care of your baby) and it does not necessarily mean getting a new “job”. I still “work” even with a 7-month old baby!
Here are some ideas to make money from home:
- Start a blog about your passion. Read my step-by-step guide on how to start a blog for $3.95 per month.
- Start a small home-based business . More ideas for home-based business you can start with $0-$1000 capital here.
- Work as a freelance writer like me. Download my free guide on how I earned my first $100k from freelance writing.
- Answer paid surveys
Here are my plans to improve my income:
- Get extra $500 worth of writing projects per month.
- Try at least 5 of the following paid survey sites to earn a few bucks on my free time. This is a great option if you like answering surveys. I will just aim for 50-100 bucks per month from these survey sites.
- Pinecone Research
- Harris Poll Online
- American Consumer Opinion
- Survey Junkie
- Product Report Card
- VIP Voice
- Prize Rebel
- Survey Club
- Make money from my other hobbies. I like decorating cookies and I would really love to start selling some for Halloween and Christmas.
My savings goal from working from home: $2500 for 5 months
Money grows on trees! Nope.
But you can grow your own food and that translates to money as well. I used to grow a lot of vegetables before the baby and it saved us at least $10 per week. Now, I’d be happy to just have three herbs and save $6 per week ( a bunch costs $2-3 at the supermarket) and that’s $288 per year!
Savings goal from herb garden: $40 for 5 months
You don’t have to follow this plan. You can customize yours based on your situation and goals. What’s more important is that you start NOW and that any saving, no matter how small, is a step in the right direction.
Do you have other tips on how to save money when you are broke? Share them below!
(P.S. I will write a separate post in one month or two about the progress of this money-saving challenge using the sources mentioned in the post. Stay tuned!)
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Earn Money from Home + Save Money + Meaningful Living