Before a person or family can get into the practice of saving money, they need to determine how much they really can save practically. I’m still in the process of determining this without depriving myself of all fun. For a long time I believed I was close to being paycheck to paycheck. It turns out I’m wasn’t. I make plenty of money for a “single” person my age. I just had/have terrible spending habits. In August 2007 I went to my check register to see what my spending habits were like and noticed the last entry was February 2006. Not good. Sadly, I’m not alone. It turns out millions of people out there don’t balance their checkbooks.

This check register is a useful little tool provided to you by your bank usually when you receive your checks in the mail. I recommend that at least once a week, you go through all your receipts and log them into your check register and balance it. It would really be best if entries were made during your purchases. I don’t usually carry my check book with me (doesn’t fit in my pockets) so I now collect any receipts from the day and log them into the register every night. I’ve become a little obsessed in that I check my bank account on-line every morning to see what has been debited and what hasn’t. I was also amazed to see how many things were being automatically debited from my account that I had forgotten about. It seems I’ve been paying Tivo twice a month. I have one Tivo. Here is a neat article from someone other than me on why you should balance your checkbook.

I’ve been good in keeping track of my purchases and deposits for a few months now. I have a good idea on how much I spend on groceries, eating out, bills, etc. I can almost make semi-informed decisions on where I can cut back and how much I really have left to save. For example, I was spending about $200.00 a month on eating out. For groceries, I would shop at Safeway, never use a list, shop after work, and not use a club card. We’ve cut back eating out a lot. We now go out maybe once a week and eat in a lot. Cooking really is cheaper than eating out, at least for us it is. I got a club card and started saving on groceries. We also always use a list and never go shopping hungry. On our last trip to the grocery store, we saved $34.00 by only buying items that were on the list and “on sale.” I also noticed that while not shopping hungry we have a lot less odd things in the refrigerator and cupboards. Our next step is to plan meals for the week in advance and shop for that. There are personal finance tools available to help track your spending. I know of Quicken and Money. I own neither but have dropped hints to certain people that MS Money would be a nice Christmas gift. We’re still working on refining and documenting our spending, but I believe we’re on the right track.