Harris: How to Celebrate Frugal February!

By Charlestien Harris

Whew! You made it through the first month of the year. Now what? What else can you do to improve or strengthen your finances? I am glad you asked! Frugal February is a month-long effort to be more financially responsible and save money. The idea is that it’s a short month, and everybody’s burned out and broke from holiday shopping, so why not use February as a period to do something difficult but important: get your finances back on track.

This practice is based on the idea that because February is already a short month, changing some of your money habits can help you learn more about your spending habits and your money story. Frugal February is a time of reflection and a time to focus on finances, tighten budgets, and avoid unnecessary purchases. It’s sort of a “changing of the guard” time to give you a chance to rediscover how you can better manage your finances! 

There are some surefire steps you can take to ensure your success and benefit from your efforts all at the same time.

1. Track Your Expenses! This is a fairly painless financial exercise, but it may pay off in the long run, provided you build on what you learn. For the month of February, track your expenses, both cash and credit. This step is critically important because you have to know where you stand when it comes to your finances. Most people are shocked when they realize where their money is going. It is almost like keeping up with your calories when you are trying to lose weight. Just like counting calories often makes you think twice about what you eat, you will see how your hard-earned money is being spent, and it can make you think twice before you spend. Try tracking your spending habits for a week, but better yet, try tracking for a month. This step is definitely an eye-opener!
2. Go on a Money Diet! Counting calories might seem easy while contemplating going on a food diet, but when it comes to keeping up with your money, it can be quite a different experience altogether. A money diet doesn’t mean you don’t spend anything, but it does mean you have to take a good, long look at your spending habits. You will want to consider spending money only on what is absolutely necessary! Some suggested categories might be your grocery bill, utilities, entertainment, dining out, and transportation. If you can skip going out to see a movie and instead watch something on a streaming service you’re already paying for, this is that month. Impulse shopping in February can be eliminated entirely with a few simple but necessary changes.
3. Review Your Credit Card and Bank Statements. Let’s not leave your credit condition out. You need to see what automatic payments are being debited and then determine whether or not you still use or need those services. That’s money going out the door that you don’t even know about because, as the old adage says, “out of sight, out of mind” can lull you into a sense of security. Reviewing your statements may help you to maximize or minimize your spending habits and get your spending plan back on track. Look at this step like you are going on a treasure hunt, and when you find the nuggets, you just might strike it rich!
4. Add That Extra Money to Your Savings. If you save money from auditing your bills, reducing spending, and so on, try taking that money that you were spending and moving it into a savings or retirement account. Since you’re already not used to seeing that money in your pocket, you can begin to grow a nice little emergency fund, start saving for your child’s education, or even your own retirement. Frugal February would be a good month to finally establish those accounts you have been putting off for quite some time. You could also use this money to maybe double the amount you wereCharlestien Harris is our financial contributor, a financial expert with Southern Bancorp Community Partners whose articles are seen in a number of publications around the region. depositing in your savings account.
5. Make the Most of Seasonal Sales. If you just absolutely have to spend some money, clearance racks will fill up with winter wear to make room for the spring clothing lines coming in March, so now is a great time to get a jump start on next year’s sweaters and hats. February is also the best time of year to get deals on TVs, furniture, appliances, clothing, tech gadgets, and vacation packages. Keep an eye out for Presidents’ Day sales that can deepen the discounts even more. I know, I know, but consider this option only if you need what you are splurging on. Buying a TV just because it is on sale and you already have a TV in every room may not seem like a lot, but it is money that was spent on an item that you did not need – remember step number two!

Frugal February is an excellent time to get your finances in tip-top shape to start the year off in the green! It is also a time to build wealth. It’s not so much how much money you make, but rather how much you save. Trying just one of the steps I suggested above can help you save more money in February. Remember to start small, and as you adjust your spending habits, it will eventually become second-nature and a permanent way to secure your financial future.

For more information on this and other financial topics, you can email me at Charlestien.Harris@banksouthern.com or call me at 662-624-5776. 

Until next week – stay financially fit!

Charlestien Harris is our financial contributor, a financial expert with Southern Bancorp Community Partners whose articles are seen in a number of publications around the region.