Deciding to get a little more frugal with your approach to life isn’t something that you take lightly. It’s one of those commitments that you have to go all in with. Because if you’re going to make it happen, you have to really change your entire lifestyle.

And when you’re used to living life on the luxury side (whether you have the money to do it, or not) that can be hard. You have to let go of some of the things that you were used to in your lifestyle. But that’s okay. And you know it is because you’re committed to making a change. After all, those little luxuries are the reason you got yourself into a difficult financial situation in the first place.

Whether you’re in debt because of your spending habits, or you’re feeling the pinch of your expensive lifestyle and you’d like to free up some of your cash for the future or other savings goals, then a frugal approach can help you. But you have to work at it. You have to retrain your brain and change the way that you spend going forward.

You also need to assess your entire financial situation and see what you can do to really turn things around. But it doesn’t have to be difficult. You just need to know the steps to take to make this happen and be conscious about sticking to it. So let’s help you to get started.

Break Down Your Salary

First of all, you’re going to want to think about how much you really earn. It’s all very well trying to break down your expenses, but you need to know how much you’re working in the first place. It’s easy to think that you earn X amount a year.

However, when everything is taken out, this may not equate to what you’d think. So make sure that you break down your income and that you know exactly how much you make, or how much comes into the household.

Track Your Spending

Now, we can really start to break down your expenses. But to be able to do that, you have to ensure that you really know what you’re spending too. Off the top of your head, you could probably recall some of your bills. But it’s highly unlikely that you’ll know exactly how much you spend in total each month. And you’d probably be shocked by it. So start to track what you spend right away.

Start A Budget Sheet

To do this, you can create a budget spreadsheet. By having a spreadsheet that you enter all of your purchases and bills into, that then tracks them by category, you’ll be able to see not only the total amount that you spend each month but also what you’re spending on. Do this for a full month to see how much you actually spend and what kind of things that you’re spending on. Then you can start to change things.

Allocate Funds

From here, you’ll then be able to set budgets for each area. You may find that you want to cut out some of the categories altogether once you’ve seen what you’re spending in them. You may want to add new categories or just shift things around a bit. Each way, set a budget for each area and then aim to stick within each of those for the next month.

Monitor Your Spending Daily

To do that, you have to be vigilant with your spending in the sense that you have to monitor it all and record it. So make sure that you track those expenses each day and record them in your budget spreadsheet. Then you’ll know when you need to cut back in each area and what you have left to spend going forward.

Cut Any Expenses You Can

From here, you’ll want to think about cutting out any expenses that you can. Even if you like your luxuries in life, you can actually allocate more money for your lifestyle when you’re thinking about cutting out the little things you don’t need. Here, we’re talking about subscriptions you don’t need, coffees you don’t overly need, and those impromptu purchases that you don’t realize are taking you over the edge.

Reduce The Rest

It’s safe to say that by being more conscious of how you spend your money is going to really help you to be frugal, as you’ll think more before you spend. But there will be some expenditure that you can’t cut altogether. So instead, you’ll want to try and reduce the costs if you can. An example here is reducing your TV package or cell phone plan to a cheaper amount each month.

Switch Your Bills

For the rest of your bills, if you can’t reduce the plan they’re on, then switch. Switching your bills each year is a great way to ensure that you’re always getting the best price. Even if you don’t quite manage to cut back on your luxuries just yet, or you don’t want to, then this will be that one thing that helps you to keep your expenses down, enjoy your life, and still live within your means.

Reassess Each Month

Now, you’re going to want to make sure that you’re reassessing that budget sheet whenever you can. Don’t do it too regularly, but at the end of each month, you can look at how you did and then base the next month’s budget on that. Sometimes you’ll reduce the overall amount you spend, sometimes you’ll just rejig the columns. But being conscious of your budget is the best way to stay on top of it.

Downgrade What You Can

If you know that’s not enough, and you’re still overpaying for a lifestyle that you can’t really afford, it’s time to cut back. The biggest area here will be your mortgage. If your house is way too expensive and you know that you can’t make it work, then you’ll want to think about selling your house and buying something smaller or in a cheaper area so that you can afford the monthly payments comfortably.

Switch Accounts

With your mortgage sorted, you’ll then want to look at your other accounts to ensure that all of your financial products are the best they can be. Look at the best credit cards in 2018 to see if you can get a better rate or better value. This way, you know that you won’t be overpaying for your credit, or you’ll be getting the best benefits.

Create A Debt Payment Plan

From here, if you do have debts, then you’re going to want to think about getting rid of them in however long it takes. To do this, you have to create a debt payment plan that will work with your income and still allow you to reduce your debt in the quickest and most cost-effective way possible. It may also be hard work, but if you’re determined to turn your life around, it will be worth it.

Increase Your Income

To help you pay down your debts and just have more money available each month, you should look to increase your income. First of all, think about your career prospects and work out what you can do to climb the ladder further to get a raise. Put actionable steps in place and then get to work.

Diversify Your Income

From here, you’ll then want to see what you can do to diversify your income. If you’re only earning your salary, then you may be limited to how much you can make. So think about the ways that you can diversify your income streams to bring in that much needed extra cash each month. Again, this will only happen if you put the work in. But if you’re not afraid of that, then you’ll be able to afford the luxuries you love in what feels like no time at all.

Start Your Own Business

As a step on from that, why not consider doing your own thing? If you want to be more in control of your earning, then think up some business ideas that you could do. This won’t be for everyone, but it’s still an option to consider.

Start Saving

When you are making money, you’ll want to focus on making some savings too. If you’ve spent a long time living above your means and drowning in increasing debt, you’ll want to change that. So start to save, even if it’s just a little. As you’ll feel more secure with savings behind you.

Stay Conscious, Stay Focused, Stay Committed

But above all else, you really have to make sure that you’re staying on track with this. You have to be able to be conscious about how you spend your money on a daily basis. You can’t just spend without thinking. You need to budget for everything that you need, and spend in line with that.

When you can stay focused on what you’re trying to achieve, and commit to that, you will make this happen. By staying frugal for as long as you can, you should find that you can reach your goals in just a few short years!