Savvy Strategies for Parents on a Budget

Reduce the Big Expenses

More than half of your family's monthly spending can probably be attributed to these five expenses. Here are some helpful tips for reducing them:

1. Your home: If you own your own home, now might be a good time to consider refinancing. Interest rates are low and the cash in your pocket may help ease your struggles for a while. And your home expenses don't just include the mortgage or rent. You're also paying phone bills, electric bills, water bills, Internet connection, and home maintenance. This is where comparison shopping is key. While you may not be able to change who provides your water or electricity, there are certainly many phone companies and Internet providers looking for your business. If you use a gardener to take care of your property, find out if there are others in your neighborhood who may charge less. These are areas where shopping around to find the best service available to meet your needs can really help.

2. Your car: Between car payments, insurance, gas, and car problems, your family automobile may seem like it's sucking money out of you. If you're planning on being a stay-at-home mom, consider keeping only one family car and driving your partner to and from work every day. You may also want to start keeping your eye on gas prices. Figure out which gas stations in town usually charge the least and try to fill up when prices are at their lowest.

Another big area in which you can save is car insurance. It's very important to comparison shop for insurance plans. In fact, finding the right insurance plan can save you up to 15 percent a year. If you're no longer commuting to work every day, make sure to notify your insurance company so that your rates may be reduced. If you own your car outright, you can also decide to only be covered for liability (the minimum recommended by law) rather than collision or theft.

3. Meals: While fast food may seem like the best option for parents strapped for money, it's not the cheapest (or the healthiest!) way for a family to eat. And why pay a dollar for a soda from McDonalds if you can buy a 12-pack for four dollars at your local supermarket? The truth is that cooking at home can provide your family with the best bang for their buck. The basic family dinner, such as pasta with meat sauce or broiled chicken with a vegetable on the side will only cost, on average, about three dollars per person. But if you just can't resist eating out every once in a while, try going to an early-bird special or saving your restaurant dining for lunch (which is usually cheaper) instead of dinner.

4. Grocery shopping: Start snipping those coupons! Manufacturers and grocery stores are constantly offering discounts on necessary products. So now's the time for you to take them up on those offers. If you get a Sunday newspaper, there are usually coupons stuck in the middle of the advertisements. Start flipping through them and clipping out the ones for products you were going to buy anyway. And in most areas, some local grocery stores will actually double the savings of a coupon you bring in. Many grocery stores also have weekly savings for people who belong to their "club." These clubs are free to join and involve nothing but carrying a little plastic card on your keychain.

You may also want to consider buying generic products. Manufacturers such as America's Choice often provide the same product at a lower cost. No matter what you're shopping for, compare the prices of the brands available. And don't forget to look at the amount of product in the packaging. A 6-oz. can of tuna may only be $1.50, but the 12-oz. can at $2.50 is a better buy -- if you can use that much tuna.

5. Travel: Wondering if you'll ever be able to spend that weekend on the beach again or go on that skiing trip you used to do every January? Travel is a huge expense for most American families, but it doesn't have to be. Consider going on your next vacation at an off-peak time. Go to the beach in September, once most kids are back in school, or schedule your skiing trip for the middle of the week when hotel rates are cheaper. Also, consider planning last-minute vacations based on weekly specials. Many airlines and hotels get together midweek and offer weekend discount trips to underbooked destinations for the upcoming weekend. Keep your schedule flexible and your eyes wide open and you'll be able to go on that much needed vacation sooner than you think.

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