Amid the insanely high prices, how do you reduce your expenses without affecting your life?

With the high cost of living and insanely high prices in various parts of the world, including our Arab world, due to several geopolitical factors such as the Russian-Ukrainian war, disruptions in supply chains, and the effects of the Corona pandemic that still extends to the present time, some have resorted to loans from banks or acquaintances and friends to cover Their increasing financial obligations, and this has plunged more people into the nightmare of debt.

For example, in a small Arab country such as Jordan, the debt of individuals reached 12 billion dinars (the dinar = 0.708 dollars) in 2020, according to the figures of the financial stability report issued by the Central Bank.

In a country like the United States, individual debt reached record records, reaching $15.6 trillion in 2021, according to data from the New York region of the Federal Reserve, and if you aggregate that amount of debt into one-dollar bonds, it would reach the moon and come back twice. .

How can we reduce our expenses and expenses and get rid of some unnecessary consumption habits in our lives, without affecting the standard of life to which we are so accustomed?

Start tracking your spending habits

The first step to saving and spending less is knowing where the money is going.

Many of us do not really know how money leaks out of their hands, but they are surprised that they need to borrow in the middle of the month, so we advise you to record your expenses for a week at the beginning and then for a month, and you will discover that you were spending a lot of money on things that you can easily dispense with, and a simple example of this is your habit In having your morning cup of coffee from the ubiquitous coffee shops instead of making it at home, or you buy a lot of fruits and vegetables that you don't really need, and they end up in the trash after they rot.

The first step to cutting back on spending is figuring out where the money is going, and remember that every budget starts with two basic numbers: your expenses and your monthly income.

Create a budget that tracks both your income and your spending. This will give you a clearer idea of ​​how your money is going in and out, and will allow you to assess your financial habits over time to see what types of consumption patterns are emerging, and how you can change them, according to Ben.org. ).

Record everything you spend, no matter how small, and you can use the traditional method by writing on a small notebook that you always carry with you, or by using technology, for example, if you use credit cards, check your data, but if you use cash (cash), make sure that you get invoices and payment receipts Then divide these expenses into two categories:

• The first category put it under the heading: the basics, which are the only necessary things that you can not do without.

• The second category is luxuries or desires, which are the things you can do without.

  This way you will be fully able to know where your money is really going.

Setting a simple and concise budget for your expenses is much better than having a more detailed budget (Shutterstock)

Set a budget

Creating a budget shouldn't be complicated.

It is simply a plan that shows where your money will go and how you will spend it.

Here, you should avoid complexity - a mistake many people make - and you can divide your budget into 3 groups:

In this simple way you will be able to monitor and adjust your total spending in these categories as needed, making your budget much more manageable than having a more detailed budget.

3 main steps to budget planning:

What remains is your “discretionary spending” and this section includes luxuries and desires, and here we advise you to specify a monthly amount that you can save for emergencies, and this is very important, no matter how small the amount is. The important thing is to put something for emergencies.

In fact, this saving should be a "goal" for you and an essential part of your financial plan, according to the Debt.org platform (debt.org).

Get rid of unnecessary buying habits

A large number of people buy things that they do not really need, and in fact each of us will find in his wardrobe shirts that he has only worn once or twice in his life, and other things are measured by that.

Determine what you really need, and stay away from buying things you don't need and will rarely use.

And before you buy something, ask yourself: Do I really need this or will it end up in some neglected corner of the house?

This section also includes monthly subscriptions, whether in TV channels, the Internet or applications, for example, many of us subscribe to television stations that we rarely watch, and there are also many applications for which we pay monthly subscriptions and we hardly use them.

Make a list of all the subscriptions for which you pay monthly amounts, determine what you really need and keep it, and get rid of the rest, in this way you will find yourself having saved a good amount of money that was going to waste.

A shopping list helps you reduce your expenses and commit to buying what you need without increasing or decreasing (Shutterstock)

This leads us to the next step:

Shopping list

Before you go shopping from anywhere, whether it is major malls or even small groceries, make a shopping list and specify what you need precisely, which will greatly reduce the "impulsive buying" that you did not plan in advance, but you saw something It made you like it or wanted it and put it in your cart, only to find out when you got home that you didn't need it at all.

A shopping list helps you reduce your expenses, and commit to buying what you need without increasing or decreasing.

There are also applications that help you create shopping lists, including Google Shopping List, which is an easy and effective option for organizing your purchases.

Important Tips

• During the week, keep a playlist of things that were missing from the house or refrigerator, such as white or red meat, vegetables, and dairy.

  Put the shortcomings in this list first.

• Group the items on the list into specific categories, for example: meat, dairy, vegetables, fruits.

  This will prevent you from wandering into aisles that you don't need to go through in the store, such as the candy and chocolate aisle, potato chips, or soda where cravings lie.

• Compare the brands and choose the cheapest and the best, and go to only one shopping center, there is no need to visit all the centers, stores and groceries in the area.

• Choose stores that have reward programs and discounts on shopping, you will save a lot of money.

Freeze credit cards

One of the big obstacles to reducing expenses is credit card debt. Many of us find it easy to use these cards, especially when we don't have enough money to buy something we need.

But remember that the debts of these cards are growing rapidly, most of them put high interest rates, especially if the card debt is overdue, which is something that happens with many of us.

If you have credit card debt, freezing your cards is a good way to cut your monthly expenses, and you can literally freeze your cards as some financial experts suggested putting the cards in a bowl of water and putting them in the freezer. If you want to use them, you should thaw first, This is according to the Debit.org platform.

If you want to do it more formally, you can pause credit cards by going to their website or app and freeze them, preventing any new purchases, and this brings us to another very important point: paying off card debt.

Make sure to pay off credit card debt before paying off other debts (European)

Paying off card debt is a top priority

The faster you get rid of debt, the more money you will have in your monthly budget or available in your savings, for this purpose put paying off your credit card debts in the first place, before paying off other debts such as car or home installments, the debts of these cards are growing rapidly due to the high interest That's why a portion of your budget should include payments that are higher than your credit card minimums so you can get rid of them as quickly as possible.

Use cash only

Instead of cards, we recommend switching to cash spending, as this will make you shop realistically as you see money coming out of your wallet, and this will greatly reduce impulse purchases.

As with many other spending and budgeting systems these days, there are apps that can help you manage this like Mint, Mnvelopes, and more.

Home Shortcuts

Finally, we come to a very important topic, which is the house, where your home and your household habits cost you a lot of money without you even realizing it, the most important of which are:

A vampire named Electricity

There is a vampire in your house and you don't feel it, any electrical device that is plugged in absorbs and consumes energy even when it is turned off and not in use.

This condition is called vampire power, or phantom load, and it accounts for at least 10% of your home's energy bill, which is a lot of waste for something not being used.

If your electricity bill is running into large amounts per month, this is most likely the reason, as reported by Fifth Person.

We know that it will be difficult for you to connect and unplug a device you use every day like your computer, but this is the obvious and simple solution to get rid of the invisible vampire in your home.

Simply unplug any electrical equipment you do not use regularly.

We also note that many families light the entire house at night, even though they only use one or two rooms of it.

Turn off the power to unused rooms and places, and you'll see that your electricity bill has dropped dramatically at the end of the month.

Preparing and eating meals at home saves a lot of unnecessary expenses (Shutterstock)

Eating at home

Eating in restaurants costs a lot of money, and here preparing and eating meals at home can save a lot of expenses, and in this context we advise you to plan your weekly meals, decide what you will eat this week, plan it and stick to your plan.

Here, the Internet offers an endless collection of cooking tips and recipes, even for those who are not good at cooking. To ensure that your food is available on working days, you can also prepare quick "sandwiches" at night to take with you to work in the morning, as you will save the price of breakfast in restaurants.