After the birth of her second child, Melissa Buckles of Troy took a year’s leave of absence from her job as a human resources manager for General Motors to give living on one income a go. Cognizant that living solely on her husband’s salary would require some major lifestyle changes, Buckles got to work restructuring just about everything from her family’s approach to grocery shopping to their cable TV plan and insurance premiums.
Her efforts enabled her to part from GM altogether following her leave – and have since equipped her with so much money-saving know-how that in 2010, she launched Bargain Shopper Mom, a website with budgeting, couponing and general family finance tips. In addition, Buckles now teaches classes throughout Oakland County to help others looking to shore up their own family finances.
“I’m saver and always have been,” Buckles says. “I love a good deal. I’ve always been that person telling friends or people at the store how to save more.”
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April marks National Financial Literacy Month and the time of year when tax returns – or lack thereof -– have many families taking a closer look at just exactly how they are spending their precious dollars. Though the economy seems to be on the upswing, Michigan’s December 2012 unemployment rate was still at 8.9 percent. And, according to personal finance guru Dave Ramsey, 70 percent of all consumers are living paycheck to paycheck – while the average American family would have to use a credit card to pay a $1,500 unexpected expense. Living on less is a harsh reality for many families who, perhaps now more than ever, are looking for ways to slash the family budget.
Taking stock of family spending
Financial advisors typically point to the crucial first step of creating a budget to begin getting your financial house in order.
“One of the biggest reasons that some people lose money each month is because they aren’t tracking how much is coming in and how much is going out, often due to fear of reality and simple laziness,” says Chris Miles, founder and cash flow expert at MoneyRipples.com. “I recommend spending a few minutes each week tracking and categorizing your money for the next six to 12 months. Set aside time each week to discuss your finances with your spouse and/or family members.”
A popular tool for budgeting and tracking family finances is Mint.com, a site favored by Miles – and Crystal Paine, the Kansas mom of three behind the popular Money Saving Mom website, which averages more than 1 million unique page views each month.
“It’s imperative to have a budget,” Paine says. “If you don’t, money just slips through your fingers. You need to be in control of your money. I also really like YouNeedaBudget.com and DaveRamsey.com for budgeting tips and tools.”
In addition to a solid budget that your family sticks to, Paine recommends setting financial goals.
“Doing so will give you momentum to stock up with penny pinching,” she explains. “If you’re married, sit down with your spouse and discuss where you want to be in one year, five years, etc. Break that goal down into bite-sized pieces with weekly and monthly goals. It can be as easy as setting the goal of saving $40 that week. When you have goals – such as paying off a credit card or saving for Christmas – it motivates you and reminds you why you are driving a used car, taking a brown-bag lunch to work and clipping coupons.”
Paine’s other top money-saving tips include maintaining financial accountability by meeting monthly with your spouse or someone who can help you stick to your financial goals. She also suggests surrounding yourself with frugal, like-minded friends.
“When you’re around people blowing money, you can be tempted to do the same – especially when you are brown bagging it and feeling sorry for yourself,” she says. “Surround yourself with people of the same mind-set or find frugal friends online.”
Family fun on a dime
Krissy Powe of Belleville took the occasion of the New Year to get busy getting her family of eight’s finances in order.
“My husband and I knew we needed to do some things differently,” Powe says. “We’d like to go on a trip to California to visit my husband’s grandmother, and I’d like to pay off some debt.”
But after putting together a solid budget and beginning to account for where their money was going, Powe and her husband realized they did not have as much money as they thought they did.
“We make money to cover our expenses, but aren’t able to save much,” she says.
To turn the family’s financial tide, Powe, her husband and her six children began by making small changes in their everyday lives.
“We no longer go out every weekend with the kids,” she says. “When you have six kids and you go out for an evening, it’s going to cost at least $100. We do more at home now. That means we have to be creative sometimes, so we look for free or inexpensive things to do.”
Powe explores event calendars, like the one found in Metro Parent, to find family events and activities that are no or low cost. Likewise, she is a fan of Groupon and LivingSocial, both of which offer discounts on family activities like laser tag, bowling and skating.
“We even did a mall scavenger hunt that lasted three hours,” she recalls. “The kids absolutely loved it, and it didn’t cost us a thing. It was also way more memorable than any movie we could have taken them to.”
Mom of two Debbie Sprawka of Plymouth Township says the best advice she has for families looking to save is to take advantage of their local library.
“Not only are there lots of free family and children’s events, but you can check out games and DVDs at no cost,” she says. “We love our family movie nights watching DVDs we rent from the library.
“We’ve also taken advantage of the library’s organized family fun nights, story time, LEGO nights, juggler and magician.”
Sprakwa checks local government websites, too, to peruse event calendars for free activities. This month, other options range from Sunday kids’ activities at the Detroit Institute of Arts (free to tri-county residents) to the FestiFools parade in Ann Arbor – and no-charge Earth Day events, too.
“I think people would be amazed at how much there is to do for free,” she says.
In addition to adjusting how her family spends free time, Powe has sharpened her focus on how her family spends dollars on groceries.
“Groceries are one expense I can control,” she explains. “So I started shopping smarter and using coupons. I began reviewing the ads for sales. I go to the fruit market which, while out of the way, carries produce for prices that are even better than sale prices at my usual grocery store. I also shop at multiple stores to get the best deal.”
Taking all of these steps has saved Powe $200 a month off her grocery bill.
“I have also become more aware of what items we’re running low on at home, so I can buy them when they’re on sale instead of at full price at the last minute,” she adds.
It’s this kind of forethought and planning that has become habit for mom Melissa Jennings of Independence, Ky. who, along with her friend Shelley King, founded StockpilingMoms.com in 2008. Through the site and their Savvy Saving Book, Jennings and King share their knowledge of couponing and stockpiling groceries to save big. It is through these tactics that Jennings says she has been able to whittle her grocery bill down to only $200 a month for her family of three.
“Before being diagnosed with celiac disease, that figure was closer to $150 per month,” says Jennings, who attributes the increase in her grocery bill to now eating only organic and gluten-free foods, which tend to cost more. “There’s definitely a ‘coupon high’ you get when you save more money than you spend. It’s exciting.”
At the core of her grocery savings strategy is an emphasis on buying large quantities at rock-bottom prices.
“We consider ‘rock bottom’ to be 50 to 70 percent off,” she says. “Something may be on sale for $1 at the grocery store. If that store doubles coupons and you have a 50-cents-off coupon, you get that product for free. Don’t buy just one; buy enough to last your family through the sale cycle.”
Jennings admits that it takes a good three months to build a stockpile and realize big savings. But now that Jennings has her stockpile well established, instead of jumping in her car when she needs something to bake a cake, she walks down to her stockpile in the basement, where she shops from the shelves lined with goods she has accumulated throughout the year.
“Don’t go to the store and pay retail,” she says. “Go to your stockpile. In addition to saving money, you’ll be saving time and gas.”
For her part, Buckles adheres to a formula for grocery savings that consists of one-third meal planning, one-third stockpiling and one-third couponing.
“First, buy what you need around sales,” she explains. “To do so, you need to start paying attention to sale cycles, so that when boneless skinless chicken breasts go on sale once a month, you take advantage and buy for the entire month. Lastly, use coupons. People get overwhelmed with couponing, but I reassure them that you can do the basics of couponing by devoting only one hour a week to clipping and organizing. In the end, you can realistically save up to 50 percent off your grocery bill.”
Buckles is not a fan of the term “extreme couponing” that has become popular thanks to the TLC program of the same name.
“I call it ‘realistic couponing,'” she says. “Start with your top 15 grocery items, those things you buy regularly. Keep a price book. Track the sale cycles, and then start stocking up. You can save $150-$180 a year on just one item.”
Other ways to save
Outside of the grocery store, Buckles says there is no shortage of ways to save when shopping for other areas of your life.
“Buy clothes off season at a fraction of the price,” she suggests. “By buying off-season clothes online with a coupon code, you can get great deals. Always look online for coupon codes and free shipping.”
“I think a lot of people are under the misconception that pre-loved clothing is ‘dirty’ and ‘other people’s garbage,’ but for the most part, that is not the case,” she notes. “You can get great deals on clothes that are often new with tags or in excellent used condition.”
Werenka’s favorite resale shops are Restyle Child in Birmingham and Once Upon a Child, with locations throughout metro Detroit. She is also an advocate of Ferndale’s freecycling program, whereby individuals looking to discard and acquire the same items are connected.
“You can list clothing, baby items, toys, etc. that you are done with for people in the community to see, and each person takes what he or she needs,” Werenka explains. “In return, you can look at what they have listed to see if there is anything that you need.”
Taking a do-it-yourself approach
Jennings notes that stockpiling need not be confined to the family’s groceries.
“You can stockpile all areas of your life,” she explains. “Stockpile for the holidays by shopping the day after Christmas when prices are slashed. I’m almost done with my Christmas shopping for this year.”
Jennings is also a big fan of the DIY movement.
“I collect recipes on Pinterest and make a lot of homemade meals rather than taking the family out to dinner,” she says.
Powe too has jumped on the DIY bandwagon and now makes many of her own household cleaners.
“I make an all-purpose cleaner, a bleach and a glass cleaner,” she says. “I found the recipes for all of these online. Not only do I save money, but I feel more comfortable with the kids handling these cleaners when they help me around the house.”
Paine of Money Saving Mom is a big fan of YouTube and other online tutorials, which promote DIY living.
“The other day our garbage disposal stopped working,” she says. “My husband watched YouTube videos on how to fix it and did it himself versus calling a repair person. There is always a less-expensive way to do something.”