Have an end-of-the-month budget balance evaluation that works for you.
In every area of your life, it is a good idea to evaluate how you did during the previous month and to plan for the next. Your financial situation is no exception.
The first question you must ask yourself is, did you have money left over at the end of your month or did you have month left over at the end of your money?
I hope you took a percentage of around ten percent off the top of your income for savings. You want at least $1000 (or equivalent in your area) in easily accessible savings that you can use in case of an emergency.
Give yourself a pat on the back if you still have money in your bank account at the beginning of the month. You are doing better than 64% of people living in the United States. If you find yourself short however and your bank account is empty at the end of the month, now is a great time to evaluate what happened that made you short. If you cut into the 10% that you took off the top for savings, you’re still not where you need to be, so if you come up short, ask yourself these questions. Was there an illness, or was there some other emergency that came up? Did you have a major unexpected car repair? Did you go on a shopping spree or out with friends on an unplanned event? Look at all possibilities and then strategize how you might be able to avoid that next month. If you had an emergency, then be sure to put money back into your savings account next month.
Look at how it is that you have money left over at the end of the month. Did you work overtime? Did you make an unexpected windfall from your business? Did you do that well in saving money? By determining how you were able to have money left over at the end of the month will help you determine if you can continue doing that or if you might want to change things so that you don’t have to work so hard.
If you paid off one of your credit cards or loans, celebrate in some way. You have increased your financial situation considerably and have more money each month to invest in yourself instead of someone else. It’s like money that you no longer have to work so hard to get because that bill is no longer part of your financial equation.
If you find that you’ll have more money next month, designate as much as possible to your emergency fund as necessary. If you already have a solid $1000 in your emergency fund, I suggest that you consider investing your savings into food, especially in the autumn months.
Take Advantage of Fall Harvests
Food is one of those expenses that each of us needs to invest in every day and you’ll get the biggest return on the money you invest when you invest in food in the fall.
During the fall months, especially this year, it will be important to make certain that you have a sizable amount of food to last several months. Farm and garden harvests come in during the late summer and early fall so getting food in bulk during this time and preserving it to last for the next several months is an excellent way to make your savings work for you—big time.
Many kinds of fruit and vegetables can be bought during this time. I remember when my eldest son was a baby I went to an auction and bought a bushel of pears for about $4. I canned it and had it for several months. Around here there are a number of these auctions that occur every year. If canning is your thing, this might be a good way to invest any money you can spare during the next few months.
Also, a lot of ranchers are cutting back on stock right now and meat is apt to cost less in the autumn than it will be in late winter and into the spring so if you have freezer space, invest in meat if possible. We talked to someone this week who has beef for sale for $4 per pound and we’re buying 20 pounds.
The same is true for grains. Grains have also been recently harvested and are more likely now to be more available than they will be later in the winter and in the spring. Grains can be bought in bulk which can then be used for making bread and breakfasts. A fifty-pound bag of oatmeal at half a cup per meal and be used for 571 meals for one person. A fifty-pound bulk bag of oatmeal costs me about $30 dollars where I live.
Six Months’ Worth of Food
I like to keep six months’ worth of food available in my home at any one time. I would suggest to anyone that getting extra food to last for six months should be the next step after having established an emergency fund.
If you have six months’ worth of food, then you can go ahead and either work to pay off debt, invest in your business, or increase your savings so that you have six months of relatively liquid assets to use to pay expenses for that long.