The Rachel Cruze Show - Budget Better, Buy Smarter, and Boost Your Savings

Episode Date: July 17, 2023

Your biggest wealth-building tool is your income, and a great way to increase your wealth is to spend (and save) wisely. In this episode, you’ll get some tips and tricks you can start using today to help you win with money. I’m sharing how I would budget $12,000 a month, the things you should stop buying, and eight easy ways to increase your savings.   What you get in this episode:  ·      How I Would Budget $12,000 a Month ·      Things Minimalists Never Buy ·      8 Easy Ways to Increase Your Savings   Helpful Resources:  ·      Christian Healthcare Ministries  ·      EveryDollar Sponsors pay the producer of this show, The Lampo Group, LLC, advertising fees for mentioning their services or products during programming. Advertising fees are not based upon or otherwise tied to any product sale or business transacted between any consumer or sponsor. The following sponsors have paid for the programming you are viewing: Christian Healthcare Ministries. Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy  Learn more about your ad choices. Visit megaphone.fm/adchoices

Just being in the habit of slowly bumping up your savings is going to give you some cash, no matter where you are on your money journey. Because let's be real, we could all use some fresh ideas when it comes to building more margin in our budget. Hey guys, welcome to this episode of the Rachel Cruz Show podcast. I'm so glad that you're here. So in this episode, we're going to talk about how to budget better, buy smarter, and boost your savings.

Then I'll go over eight ways to increase your savings. and I'm going to go over a budget also that was submitted to me last month and talk through what I might do differently and what I am loving that they're currently doing. But first, let's talk about some things minimalists never buy and why maybe we should think about not buying them as well. So take a listen. Today I'm looking at one of your budgets.

So I led a class called Financial Peace University, which is our nine-week money course, and I did this a few weeks ago, and I asked my whole group, which was a few hundred people, if they were willing to share their monthly budget with me so I could, like, use it on my show and unpack it and talk about budgeting.

And you guys, I had so many volunteers. So many people were like, yes, do mine, do mine, do mine. And last month, I did this for a listener and explained step by step what I would do with their amount of money that they make every single month and they were on Baby Step 2 and it had some stuff. And it was so fun. It was really great.

And I loved even being able to celebrate with her and her husband because they made so many financial decisions that helped them. And again, hopefully I gave some guidance and direction, but they were killing it. And it was awesome. So I'll put a link to that video for that budget breakdown so you can check it out. But today, I'm going to do it again with another listener because, let's be real, creating a monthly budget for the first time can be really intimidating. But the truth is, is that anyone with any income, no matter where you are with money,

you need to have a plan. and you can have a plan. All right, it's time, you guys. Let's look at the budgets. Okay, I'm going to pretend that their names are Mark and Brenda, just for the fun of it. Their ages in real life are 49 and 50 years old. They want to retire at 62.

They want to move somewhere warm. Their kids are 14 and 18. Now, they're planning on cash flowing their 18-year-olds college next year, and it's going to be $30,000 over $5,000. years. So that's the big thing coming up. They're also anticipating an upcoming used car purchase that they're going to make. So they started actually a sinking fund for that in July. And they started the baby steps, everything we teach at Ramsey Solutions, November of 21. So they finished

Babysept 2 in October of 22, so 11 months later, which is amazing, completely out of debt. And they're building up their emergency fund of $25,000. Now, at the end of June, this month that we're currently in us in filming this, they're going to be finishing it. which is amazing. And they currently have $450,000 in retirement, incredible. And they're going to start contributing 15% of their income into retirement again in July. Since June, they'll be past Babyself 3. They'll be starting four, five, and six together. So again, that's going to be funding 15% of their income into retirement, their kids' college, which they're going to cash flow. And then they have a 15-year mortgage with about $100,000 remaining, and they want to start paying that off in July as well.

So lots of big goals, some really exciting stuff. Now, their total income every single month is $12,2,239.12. Now, again, everyone's income is different. So it's fun to do incomes that, you know, are less than this, more than this, all the things. But I thought this was a really great income. So I was like, well, let's look to see what progress they can make. So again, as I'm looking at their June budgets, they actually, technically are $57.80, three cents over, which for some people are like, oh my gosh, that's like crazy.

Y'all are that specific. But it's like, yeah, you want to be specific if you know that you're going to have to pay for stuff. So let's look at if there's a place that might be easy to take some money out. Okay, so you know what I would do? The husband and wife money, $400 each. So just to get this to zero, you guys, personally, I would change this. Let's go. Five.

Let's take some money out. Did some quick math on the calculator. Now, their savings is huge when we go up to the top. So you see that. Now, again, after June, you guys, that is going to be funded, and their $25,000 emergency fund will be complete. So I thought it'd be fun. Let's just skip on over to July.

Let's see what this would look like if they are on baby subs, four, five, and six, which they will be in July, which is awesome. So your emergency fund, you're done. So you can zero that out. Now you're going to start saving up for retirement. So 15% of this income is roughly $1,800. So we'll just plug that in here. So their daughter's college, we're going to just add here

because that'll be the next step. So they said $30,000 over five years. So that's $6,000 a year, $500 to save. And so they have. $838 left. So what's left for this would be paying the house off early, throwing some extra money at the house, and their mortgage is $1,200. And they want to save up a replacement vehicle. So what I always like to do is kind of back out these numbers. So for their replacement vehicle, let's say they sold their car right now, they could get $6,000 for it, just out of pretend.

So let's say they want to save up $14,000 to get a $20,000 car replacement. And let's say they want to do that in a year. So they need to save about $1,100, $1,200 a month to get to that point. So what they have left right now is $838. So either they can just throw all that in the sinking fund. If they want, they could lower that $20,000 to, you know, $18,000, $17,000 car. it's really what they're going to decide to do. So for the fun of it, let's just say,

let's just try to get to $900 here. So that means there's $61 over to put some of that money in a replacement vehicle sinking funds. You'll save it month to month. So I would look to see, okay, where are places that we could cut back a little bit on? I mean, you can really spread this out

because it's really not that much money that you're having to cut. So you really could go to clothing here and just say, yeah, let's do, you know, 175 there. Let's find home services, Google Drive, premium plus, sharing app. They have a lot of this stuff. The YouTube family membership and Hulu and Netflix. And I'm going to just bet that they don't use all these.

So let's just say, let's just say you deleted Netflix for a bit and see if you really missed it. Maybe you do. You can put it back later. You know what? Volleyball travel, I bet that was for June. I don't know if that'll be for July. So if it was for July, that would free up a whole lot. I'll keep it in there because maybe it's tournaments through the summer. So we're going to lower the wife's amount per month because we lowered the husband's last month and hers was a little bit higher. So we're going to kind of just even them out. So that would be $358 and $60 that she'll have. And that's in every budget. So, again, this is like really down to the pennies, you guys, and you can go through and on your own budget say, yeah, we can, you know, again, some of this is like 20, 30 bucks here or there. So it's really specific. And this is where budgeting is so key and where you can actually

find money because some of these, like car, the gas in their car, all of that, it fluctuates month to month. So you may have a bigger month and you forget to change it over. So in their instance, they have $1,000 for car one for gas. That could have been because they took a road trip in June, and maybe, honestly, they only need $400 this month. Well, that frees up $600 just from one change of a category. So that's why it's important to do this month to month, and you'll be able to find some of this money.

So if I was them, I would probably be, I would be focused on this right now. This is what I would do. I would save up for that car. And then once that car replacement is done here in about a year, then hopefully even income has gone up. Even things have changed in the budget, and you'll have some extra money, which could be, again, a whole other mortgage payment a month to throw at the house. So that's what this looks like. But again, remember, when you're on babysubs

four or five and six, like they're going to be in July, it's more about intentionality than intensity. So if they want to save up for a vacation, they can, you know, pause on some of this stuff if they need to, save up for that. So this is really where you start to pick and choose what your goals are, but you want to be working towards something. That's why I love this because it's like, yes, we're going to be doing retirement. We want to be doing that regardless. kids college, we want to cash flow that. Pay off the house early is an amazing goal. But some months may be better than others

when you're throwing extra at the mortgage. So there may be some months you don't because you're saving up for something else like a car replacement or even a vacation. So the idea is having goals in mind that you're working towards, you're being intentional, you're still not just floating through life.

So they obviously have a great income. They're able to do a lot of things, which is amazing. And I think it's so exciting. So here's their July, every dollar budget, now that they're in babysubs, four through six. So thank you guys. much for submitting this, you out there. I really appreciate looking at your numbers because I think it's really helpful to talk about this because there's never shame around money. There shouldn't

be shame around money. There should be a lot of courage to say, hey, I want to see progress with my money. I think that's a really great thing. Now, if you're interested in knowing more about budgeting or maybe even your budgeting for the first time, I really recommend the every dollar app. It's 100% free to download. I will leave a link in the description so you can check it out. And also, if you're curious about Financial Peace University that we talked about earlier, you can go to ramsysolutions.com slash FPU to learn more. All right, you guys, I hope you enjoyed this look at someone else's budget. I think it's so key. Again, as specific as we're getting, it's so helpful to know where your money's going.

Today, we're going to talk about things that minimalists never or rarely buy. So the topic of minimalism is so popular right now. and I've had the opportunity to interview several minimalists on this show, and you guys always love learning about the tips and the tricks when I have them on, as do I, and how we can all learn to live with less. And the decluttering trend has really taken off with organization experts like Marie Kondo and the Home Edits, and these people have just made things very aesthetically pleasing and simple, and it's just a really great thing.

And I feel like a lot of people really started making, changes when COVID hit and we were all stuck inside for weeks. And you look around and you're like, oh my gosh, we have so much stuff. Do we need all this stuff? And people start questioning those things, which is really great. So one of my main goals on the show is to help you handle money wisely. And we talk about budgeting a lot. And one of the first things I encourage you to do when you're working towards your money goals, whether it's paying off debt or saving up for an emergency fund, is to cut things out of your budget that you don't use, like unused streaming services, gym memberships, expensive grocery stores, those kinds of things.

So today, I'm going to be reacting to a list of things that minimalists claim that they never use. And I'll also share a few items of my own that I either stopped buying altogether or, again, limited since this idea of minimalism has taken over. So I thought this could be helpful if you're trying to trim your budgets. Or maybe you've thought about doing a no-spend month where you don't spend any money except for paying the bills, but you don't really. know where to start. So hopefully this will give you some good ideas. All right, the first thing that minimalists claim that they never buy is single-use items. So this is anything that you use once,

and then you discard or dispose afterwards. So things like plastic Ziploc bags, grocery bags, plastic water bottles, single-use coffee cups, paper towels, disposable silverware or straws, to-go boxes, anything styrofoam, even disposable razors, gift wrapping, balloons, all the stuff. So all of these things on that list are not great for the environment. Plus, they take up unnecessary space in your house, which again, we all get frustrated with that, like, Tupperware drawer that's like missing lids and all the things.

So, all right, guys, that's one of the first things that we see is the single-use stuff. And I'm not going to lie, I am guilty on basically every single one of those items. But I get it. Like, when I read that, I'm like, yes, that makes sense. The hard thing for me always is like what's convenience, what is quick, what is something that I can do very fast. And usually it's the single use items. So if you remove that stuff, though, again, not only does it give you more space because you only have the things that you're going to use, but it's good all around. So I totally get it.

All right, the second thing, minimalists tend to stay away from are trendy clothes. So trends come and go as we know. and either they buy secondhand items, and they're like, yep, they get a great discount, or they just invest in really quality pieces that are going to last. So, you know, again, you see people and they're like, oh, it's this or this or that, and it's this look and that look. Listen, for a lot of minimalist, they're like, hey, we're going to just kind of stick to one thing, like we're going to wear black.

The minimalists, actually, this is like what they're known for us. It's their black t-shirts. Because, again, you can look sleek and cool, and it takes. way less effort to dress in the mornings because you're like, I know exactly what I'm going to wear. Everything always matches. You can do a smaller wardrobe and you don't have to keep up with the trends constantly. So I think this is really key. Now, you all know I love clothes. So if I do buy trendy pieces, I do not buy very expensive ones. I like, you know, whether it's Amazon or Target or whatever, I buy them very inexpensive. But it is, it does, you know, take up room in the

closet and I get that. So I even go through and I'm like purging stuff because I'm like, oh, I do hate that feeling when you walk in and you're like, I feel like I have nothing to wear, but you have a closet full of stuff. So this trend, I totally get not to buy trendy things and to go really simple with the wardrobe because it does take less effort when that's your mindset. So I get it. All right. The third thing that minimalists don't buy is excessive home decor. So anything seasonal is pretty much a tactic of consumerism these days because they take advantage of every single holiday. You know, when you walk into Walgreens in August,

and it's like Halloween, and you're like, what? And there's Christmas and there's Valentine's Day, all this stuff. So minimalists would say, do not buy, you know, themed candy, or again, spooky spider webs, you know, with stuff. Like, it's like, go very simple. Anything extra around the house you don't need. Now, some people are very passionate about those throat pillows that are per season and all the things.

But, man, it just takes up so much time. And, again, storage really is what it ends up being. So this is one that I can fully get on board with. I am not a seasonal decorator at all. I mean, Christmas is the one that I'm like, all right, we'll do some stuff for on Christmas. But if you come in my kitchen in February and you come in my kitchen in October,

it's going to look the exact same. I'm not a seasonal decorator. And again, it's nice because you're not having to keep changing stuff out and buying things and storing things. It's just very simple. So I love that one. All right. The fourth thing that minimalists avoid is single-use

kitchen gadgets and extra dishes. This is a really good one. So think about any tool that does a job that, you know, a knife or a spoon could do. So just think about this. Apple slicers, ice cream scoopers, lemon or lime squeezers, multiple types of glassware and drinkwear and silverware and plates and bowls and all the things. There's just a lot of stuff around the kitchen.

Now, I have some of the things on that list. I'm not going to lie. And I love a good lemon or lime squeezer. I just feel like you get a lot of juice when you use those. So I do like that. But yeah, a regular spoon can scoop ice cream. Like, we don't need three different ice cream scoops. But there are these accessories around the kitchen that you end up buying and you pull a drawer and it's like all this stuff is just in there.

And you don't need it all. So I can appreciate that one. All right. The fifth thing that minimalists rarely buy are single use beauty or hygiene items. So cotton balls, cue tips, makeup remover wipes, multiple makeup brushes, nail polish. all of that. I'm not a very good minimalists on this episode because I use a lot of that stuff, you guys, I really do. But it makes sense. Like, I get it because it does. It's wasteful and it takes up room and all of it. But for me, there are things that have, like, very specific use that I'm like,

oh, yeah, I do use that. But then you get in your head and you're like, oh, you end up buying more and buying more and buying more. And then you look up and you're like, oh, we have drawerfuls of stuff that we really don't need. So again, it's all about prioritizing and asking like, am I really going to use this? So here are a couple things, though, I can tell you that I definitely have stopped buying or really bought less of using this mindset. So if you're trying to make some changes in your life, just look for really simple things that you can even just take out of your monthly budgets to save money,

and then you end up not buying certain things in those categories, which is really nice. So for me, cleaning supplies. So I have kitchen cleaners that I actually make homemade, and it's so inexpensive. It's honestly probably way better just from like a chemical standpoint. It smells really good. It's easy to do. All of it. So I'll actually put a video, a link to the video that I did for all cleaning supplies that you can make at home. And again, it's so less expensive and I love it. Another thing is I've learned over the year is kids shoes. Y'all, I used to buy so many shoes. Like my girls would have like, I don't know, three different types of sandals and all the stuff.

And it wasn't even for like looks. It was just like, oh, the more quantity we have. If something's lost, we don't have to go look for it. Like it's right there. It's can be. it's quick, but I've been done with that. I'm like, nope, nope. So I'm like, every kid needs three pairs of shoes. You need a pair of tennis shoes. You need some like flip flops or sandals running around in the summer. And then like a nicer pair of shoes, like if we're going church or doing something kind of nicer. But besides that, we don't need the in between shoes. Like, this is all we need. So for me, I simplified that. Oh, and it made life so much better. And then I also simplified my beauty routine, like even my skincare. You know, there was a time in

my life where you would have, I don't know, five or six things I would do at night to my skin. Now, 50-year-old Rachel may regret all of this, but now I'm like, I just wash my face and put on some moisturizer and go to bed. So I don't make it complicated. And again, saving money that way for sure. So there are things I've definitely pulled back from, which has been very nice and simplified. But I also find what's practical for you and your family is great and just make sure it's in the budget. So there you have it, you guys. Some practical shopping habits from me and definitely from all the minimalists out there. So if Minimal living, it seems daunting or even impossible for you, or you're kind of skeptical about

changing your shopping and spending habits. I challenge you to pick just one of these things that we talked about today. Do it for a month or do without it for a month and see what happens because you might be surprised about how you're really able to adapt, how you may not miss that thing at all. And if you do it, you know, put it on social, tag me because I want to see the progress because, again, I think trying new things and learning, hey, if I'm comfortable in something, if I do something and change it actually may help me and my budget. Today, I want to talk to you about easy ways for you to increase your savings. And this is something that I hope will be really helpful,

no matter where you are on your money journey. Because let's be real. We could all use some fresh ideas when it comes to building more margin in our budget. So to start, the first way you can increase your savings is to have a no spend month. Now, let's just be clear. This doesn't mean that you halt all expenses and you stop paying your mortgage. and your electricity bill. No.

A no spend month is just one way to drastically cut back on your non-essential spending for a short period of time. So really you're going to just focus on your four walls, food, shelter, utilities, and transportation. And then you skip all the access, you guys.

So everything like the fancy lattes from Starbucks or the impulse Amazon ordering that we all do, or you see your favorite influencer in a pair of new shoes she has, all of that, you don't buy. And I know a no spend month. doesn't exactly sound fun.

But listen, this can really turn your savings into a lot. And it's kind of like an experiment, you know, kind of like a game. And you can even, like, do things like color in the squares on your calendar each day that you successfully make it through the challenge. Or maybe you're doing this with a friend or another couple and you guys text, like, funny gifts every time you, like, want to buy something, but you don't. So, again, don't be afraid to celebrate the small wins, the big wins, but have fun with it. but I'm telling you, that is one way to boost your savings.

All right, the second way to increase your savings is to put reminders of your money goals right in front of your face. Yep. So tape a meme inside your wallet. So every time you go to take out your debit card, you see it. Or maybe put a picture of your family on your bathroom mirror or your dashboard of your car so you can just remember why you're doing this. Keep your savings goal tracker on your refrigerator so you could see it or put a picture

of the thing that you're saving for on your screensaver on your phone. So every time you open it, you see it. Whatever it looks like, just use the spaces in your life that you see every day and turn them into motivation. And it was a great thing. So the more likely that you are reminded of your goals, the more likely you are to stick to them. All right, my third tip is to increase your automatic savings by small increments. So this can be a really small adjustments that you can make. That again, you may not feel a lot of the impact right now, but it will, you know, pick up in the long run. So even if you bump up your weekly savings just by $10,

you could have $520 by the end of the year. You know, so you think about you do that over and over and over and over or increase your savings by $1 a week, then $2, then $3, then four, then five, and see how far you can go. Again, this strategy isn't going to give you, like, a lot of cash. If you're, like, paying off debt or something, you want to do things that are more instance, like selling stuff or getting a side hustle. But just being in the habit of slowly,

bumping up your savings is going to give you some cash. All right, my fourth tip is to save all the loose change in a jar. So this is old school, you guys, old school, but it is still happening. A recent study by CoinStar found that on average, people have around $56 just laying around their house. You've seen people dump in massive amounts of change into these containers at the grocery store. Maybe you have a relative that's kept tons of spare coins or dollars. bills. Whatever it is, it takes some time to do this, but it's really easy just to throw that extra

change, and you can literally build some savings over time. The fifth thing that you can do to increase your savings is to get competitive. So, I mean, if you're a parent, you get this, turning a chore into a competition for your kids. It's a game changer. So face off against your spouse or your friends to see who can save $200 first or set a deadline to see who can save the most amount of money and the shortest amount of time. So listen, time fly. and savings can grow as time goes and have fun with it. Have fun with it. Make it a competition.

The sixth thing that you can do to increase your savings is to cut something out of your budget that you really don't want to and see if you miss it. So this one surprises people, but it is a tried and true way to live. So starts by committing a month to not do something that you really think that you love and you do. So whether that's like canceling Netflix or canceling a monthly subscription that you have, like something that you're like, no, no, we love this and we use it all the time. When you cut it out and you don't have it, you actually learn to live life without it

and see if you miss it. I think about Chip and Joanna Gaines. I heard that they got rid of their TV temporarily when they moved, and they loved not having a TV so much that they never went back, never had a TV. I'm isn't that crazy? So it's amazing where you make these cuts in your life that you think you can't live without, but you start to live life where that becomes the norm, you realize you can live with less. So that's a great way to save some money.

The seventh way that you can increase your savings is to do the pantry challenge. So don't go near in all the republics. Try to use up everything that you have in your refrigerator or your pantry. Even ask neighbors or friends for new recipes. I mean, you can cook up, you know, all kinds of pastas and stuff. Like, when you look back at your pantry,

it's like, oh, we haven't used that or that or that. Grab some stuff and make a meal. There's even a whole YouTube account that I heard from my friend, Jade Warshall. It's called struggle meals. And he shows you how to make amazing meals out of the most random ingredients that you probably have in your refrigerator or pantry.

So again, if you wanted to live off chocolate chips for a day or two, now is the time. It'll give you some savings, I'm telling you, do the pantry challenge. And my eighth and final tip for saving more money is to limit social media. It's amazing when you're not on your phone and you're not using apps and social media,

you end up saving money. Our church went through a digital detox where you limited phone use and social media and deleting apps and all of it. And when you do that, you guys, I tell you, when you don't have Amazon on your phone, when you don't see your social influencers that you love so much, but they are showing you great stuff that you want to buy. When all of that is gone, you end up saving money. So this one, again, doesn't have to be forever, ever, amen. But just try it and see how much money you save.

It's always helpful to find ideas on how to boost your savings. I would love to hear from you guys. If there were ideas that I didn't mention on here, let me know in the comments because I would love to hear how you find ways to save money. And if you haven't taken advantage of our budgeting app every dollar, make sure to do that. That's the app that my family uses.

We use every single day, literally tracking transactions. And it's my number one resource that I recommend for people to reach their money goals. So make sure to check that out. And a lot of people say that they feel like they got a raise when they did their first budget because they're actually know where their money's going and they can cut stuff and figure out where to put things

and they have control. Well, hopefully, you guys, those are some new ways for you to think about saving your money because margin, it's a great thing. Well, thank you guys so much for listening to this episode. And if you will, please review, leave a review on this podcast because it's just really helpful.

For our team, it's fun to hear from you guys and it helps other people find the show. also send this podcast to a friend. If you know a friend that would love this content and love what we're talking about here, please just spread the love, send it out to them. Well, thank you guys again for listening and remember to take control of your money

and create a life you love.