I’m keeping a spending diary to help me get a really good handle on what I’m spending and save money. However, I’ve been having issues keeping track of everything, so I think I’m going to take advantage of tumblr’s microblogging capacities and blog each purchase. Thankfully, I already reached my monthly savings goal of $600 as of today.

Wednesday: $8 on breakfast and coffee

Thursday: No spending! Yay!

Friday: $7 on a gyro and $11 on french macarons (a splurge for working very hard). Total spending was $18, $3 over my daily budget of $15.

Saturday: $25 on food and drink celebrating my partner’s birthday, which I saved money on by using living social to scope out a discounted steak dinner and used my reward points to pay for part of a hotel. However, I was still $10 over budget.

Sunday: No spending, woo hoo!

Monday: $15 on lunch

Tuesday: No spending, even though I was out all day, w00t!

How do you keep track of your spending? Is there a specific spending diary format that you like to use?

I am so thrilled that I am finally out of credit card debt! I got my first credit card in 2007 and have been carrying balances of various amounts ever since. Making my last credit card payment was a huge relief and it is great to know that I will be saving money on interest and not have the anxiety of credit card debt hanging over me.

However, as I’ve stated in previous posts, most of my debt is in the form of student loans. Thankfully, it is all low-interest federal Stafford loans (the majority subsidized) with generous repayment options. Currently, I have not made a single payment on my loans due to working less than full time since graduation in Spring 2009. This has been very helpful for my budget, but with capitalized interest my loans have increased from the original $33,000 that I borrowed to nearly $37,000 that I currently owe. I am trying to continue to defer my loans since I am still not working full time, but I know that I have to tackle them very soon and have been imagining possible repayment plans for the past several weeks.

Despite feeling confident about handling my student loans and really proud about paying off credit card debt, I feel as if I am constantly stuck in an eternal battle to pay off debt and save. Not necessarily save as in put money in my emergency fund, since that is pretty well stocked, but save for other goals.

Beautiful! Love those round zeros!

For example, I’m hoping to start pre-recs for a second master’s degree in 2012, and I would also really like to learn a language and travel more. Therefore, I have been looking at language schools in Central and South America, since they tend to be much cheaper than taking classes state-side and I would also learn through immersion. Plus, I’ve always wanted to go to Guatemala which is a country that is not only cheap, but highly recommended for Spanish language learners. I estimated that my trip would cost around $1500, which isn’t much and totally doable if I start saving very soon. However, I feel like I shouldn’t be spending money on something “frivolous” like traveling and learning when I could be putting money into my student debt. On the flip side, I feel like I should take advantage of having the time to travel since I know that won’t last for the rest of my life, while paying off my debt will take years if not decades. 

How do you balance paying off debt vs. spending money to enjoy your life and reach other goals? Is there are way to do both bit by bit?

Today is a guest post from my sister, Maggie, about staying styling when you’re on a budget.

I am Broke Gal’s younger sister, with the same mind (and desperate need) to save money. I am in my second year at college outside NYC, close to my favorite broke gal! Though I have been fortunate to receive a generous financial aid package, work-study doesn’t pay much.

I’ve found the easiest and most fun place to save money is clothes, and below are my favorite ways to stay fashion forward while being frugal: 

1) Thrift stores are the best!

Instead of going to Target or Forever21 when I need wardrobe basics, I start at Goodwill and other thrift stores. You can’t go wrong with $1 t-shirts and $10 jeans, not to mention most of the high-waisted styles gracing today’s racks can be found in vintage form for half of the price.

2) Do a clothing swap with like-sized friends.

Last Spring my dorm had a “dump and run,” people drop off gently used clothes and shoes they no longer want in a designated spot- take some and leave some! This can easily be replicated by getting some friends together at your apartment, have them bring some clothes and trade off.

3.) Snip and sew!

Grab a pair of scissors and a sewing kit and think outside the box. Oversized t-shirt, old jeans and extra fabric can be transformed from boring basics to cute and creative one-of –a-kind pieces. Show off your skills to enough people and you might even be able to turn a profit by reinventing your friends’ clothes.

Just because you don’t have deep pockets doesn’t mean you can’t look great and feel good. Add inexpensive costume jewelry and hand-made accessories to personalize your favorite finds.

Plus, buying recycled clothes is more ecologically friendly and sweatshop-free. What’s not to like? What are your tips and tricks for frugal fashion?

I am honored to have a guest post from Carrie who blogs at Careful Cents. She tells us about her financial journey and why hope is always the most important thing in all aspects of life, even money.

On my blog Careful Cents I talk about my money, personal finances and my life in general. Even though I’m in my twenties, I’ve learned and experienced a lot. Through it all I’ve found that it’s important not lose hope.
 
I lost my mom to breast cancer when I was 15 and with it a lot of hope and security about my life and future. It’s one of other major events that defines who I am today, and my outlook on everything. Many people encounter devastating life events like mine, whether they are financial or relational.
 
But it’s important to understand what I had to learn, that your situation can always change and you’re the only one with the power to overcome it. As long as you don’t give up and have confidence within yourself you can do anything. I’m a very inquisitive person and when I feel I need help or am struggling I go searching till I find it.
 
Many times reading other people’s stories and experiences help inspire and motivate.There are many things that Broke Gal in NYC has helped me learn and understand. Plus just knowing that there’s someone like me out there with some of the same problems and goals, is encouraging. That’s my goal in life, to share the my mistakes (and successes) and hopefully help others who are experiencing similar issues. 
No matter what you’re going through with your financial journey or life in general, if you remember to be hopeful you can accomplish anything. You are not alone in your struggles, and no handles their money perfectly. It’s okay to fail or wish you had done something different. But that’s what the future is for, to correct past mistakes and learn from them.
 
Failure is not a sign of personal weakness but in my opinion if you don’t ask for help when you need it, you have failed. Remembering hope while on your financial journey is a vital part of setting and reaching your goals. Hope is the anchor of the soul and without it, we would all be lost, floating around in life.


Carrie is a Certified Bookkeeper, Tax Professional, and personal finance writer. She’s a self-proclaimed nerd and food lover that enjoys traveling. Her overall goal is to make cents of life and money. Find her on Careful Cents and Twitter

Teriyaki sesame spinach with clams and herbed butter with sourdough toast points. Cost: $8/person.

My favorite way to save money is cooking. In previous years I never cooked, and instead overspent on take out, convenience foods, and eating out. Nowadays, I rarely eat out and instead enjoy trying out new recipes at home and cooking for friends. I also start making a point of shopping sales and only buying certain items when they’re on sale, or buying in bulk when favorite staples are on sale.

My tips for making delicious, healthy, and cheap meals are:

• Focus on filling bases, such as pasta, legumes, and cereals. I prefer to buy whole wheat pasta which lasts for awhile and can be cooked in any number of ways. I also buy frozen fruit in bulk for smoothies and other such snacks. 
• Have a well-stocked spice and oil cupboard so that you can change up the taste of basics. Balsamic vinegar is a personal favorite and is delicious with pasta, pizza, and veggies.
• Make sure you know how to cook something and have the proper tools to do so. I once bought oysters on super-sale and had to let them go bad in the fridge because I didn’t have the instruments to open them.
• Follow coupons and sales. I personally do our grocery shopping online via Food Emporium, which allows me to automatically load coupons both in store and manufacturer’s coupons. We saved over 40 bucks a week by using Food Emporium and not the other grocery delivery that doesn’t take coupons.
• Learn and have fun! Through various food bloggers, youtube, and google I have learned how to cut any number of things at home, including curing my own salmon and making my own jam.

Doing this, I estimated that I cut my food budget in 1/3rd since my only-take out days. Additionally, eating and cooking at home is much better for my health and the environment. Plus, now I have an awesome new hobby!

What is your favorite way to save on food?

One of the most important things I’ve learned in the past year is that substantial savings are essential for financial well-being, especially if you’re trying to get and stay out of credit card debt.

My current debt to savings ratio

The first issue people bring up when approaching how to save, I’ve noticed, is that they’re concerned that they’ll never be able to find the money to save or they’ll have to live completely barren lifestyles to have an emergency fund. Not true, although I have definitely had to cut back on spending since I got serious about paying down credit card debt. My favorite ways to save are the following:

• Cook at home if at all possible and DIY things. Maybe arrange a clothing swap with like-sized friends or doing such home improvements such as painting and decorating on the cheap. I made it a point to cook at home as much as possible instead of eating out or getting delivery/takeout. Thus far I’ve saved my partner and I hundreds of dollars by cooking often and bargain hunting for our groceries. I also DIY my own favorite treats like cured salmon and small batch jams and preserves.

• Make sure you are not overpaying on services such as cell phones or rent and think about canceling services such as cable television. Also make sure that you have a realistic budget and are sticking to it best as possible. Rent in particular can be really hard to keep under control in an area such as NYC, but the metric that rent should be no more than 30% is a good rule of thumb when figuring out how much apartment you can afford. Moving from an apartment that was 800/month to a place that was 500/month made a big, big difference in my budget. Another good budget hack is the 50/30/20 budget, which I know many people use and love.

• Make a savings plan and stick to it. Set a goal and touchstones to fill it, no matter how small. For example, I set a goal of having an emergency fund of $1,000 within a year. I broke this down into a Minimum Weekly Savings the same way I did with my credit card. I now treat savings as I would any other bill and make sure it is “paid” on time. In this vein, make sure you are not trying to be too aggressive and set yourself up for failure. Make sure your savings goals and amounts are realistic

• Put any extra money you get into your savings. I put at least half of any unexpected income into savings. Find a percentage of how much of unexpected funds you could put into savings that works for you, depending on your needs, wants and debt load. This can really help you reach your emergency fund goals faster.

For me, I find it easiest to calculate my savings needs and then automate a weekly transfer to my Ally Online Savings Account. However, make sure you have money in your account to cover the transfer or you run the risk of overdrawing and incurring fees.

Currently, I am on track to save $5,000 by January, after having less than $100 in my savings as of this time last year. I hope I can find more ways to cut back and make more money since my current goal is to save $10,000 total in the next 24 months.

What are your favorite ways to save?

One really important factor in being debt-free long term is to build up your savings. Then when you have an unexpected expense you are not turning to your credit cards.

A good target for your saving is $1,000. If needed, don’t set any time limit to save this but instead put a bit away every week.

I personally use Ally Bank which has great tools for setting up automatic savings transfers based on savings goals. They also have one of the highest interest rates AND rarely charge fees. My savings is also semi-easy to access but I couldn’t get it immediately, which keeps it out of sight, out of mind.

Even if you keep your savings in a shoebox under your bed, it doesn’t matter. The point is to keep it. Without savings you run the risk of always reaching for your credit card when something unexpectedly expensive happens.