Have you heard about this. Well, we have been doing this for about 18 months or so. Some people say it's Dave Ramsey, but that i have NO CLUE about. I have never read any of his books or seen him. I do know that in tough times we ALL need to be more careful of spending habits. It is WAY to easy to get into debt.
So what is a cash diet. It's simple really. Use CASH ONLY. You may think that it doesn't matter but really if you have to use cash you will SEE how Quickly you can spend it.
We started it last year January. We had some things we wanted and decided that we needed to really watch the budget. Of course you can say you will, but who checks up on you. No one. So when you say, "oh i will get that coffee today and skip something next week". Do you REALLY do that? Maybe you do, but most people 'forget' about it. I know I would.
So have cash. I can only spend the money that I have. It really makes you go through a store and look at it differently. Do you REALLY need that Candy Bar, or anything else you put in the cart. I am sure you get the statements the end of the month and think, WOW.
We used to get the statements and then remember what was bought. We also knew, but it never clicked how much things cost until we paid the bill off.
So Sit down, by yourself or with your spouse/partner, and get out the pay stubs. Figure out the amount that is brought in monthly. Then start figuring out expenses. We started with ones that NEVER change. Mortgage, insurance, savings, car payment, and then went from there. We need groceries and gas. And then looked at what was left and decided what to do with it.
If you don't know what you spend in groceries and gas, get the credit card statement and look at it. And if you can't find it. Do your best guess and keep your receipts the next few weeks. Sit down in a month and then re-evaluate. I would suggest if you don't know exact amounts, be careful spending TOO MUCH on other items, you may end up with LESS cash at the end of the month.