How to stop small expenses from getting bigger

My husband and I have been living on a budget for a few months, and for some reason there seem to be leaks in our budget. It’s just a few dollars here and there, but added together it makes a huge dent. Can you give us some advice?

Dave Says:
This kind of thing happens a lot in household budgeting, especially to folks who are new to the game. Here are some ideas to help stretch your dollars and plug those leaks.

Use the cash-only method, especially when shopping for groceries. Take only the amount you have budgeted, and don’t use your debit card or a check. Also, use coupons only for items you would buy anyway. In addition, you can stock up on items you use often when there is a big sale. These little things will add up.

Try eating out only on special occasions, drink water as your beverage and don’t be afraid to use coupons in restaurants, either. When it comes to buying clothes, make a habit of checking out the sale rack first. You can shop at thrift and consignment stores, and sell the clothes you don’t wear anymore.

With entertainment, use dollar-off and buy-one-get-one-free coupons whenever you can. See a matinee or a second-run movie, and if you’re going somewhere with a bunch of people, call ahead and ask for a group discount. You’ll be amazed at how much money these tactics will save.

Unlikely government will seize someone's 539 asset

Dear Dave,

    I have a 5-year-old daughter, and I want to start a 529 for her. However, I'm concerned that the government might seize the 529 assets in order to pay off debt and give people treasury bonds instead. Do you think this might happen?

Barry


Dear Barry,

I think there's less than a 1 percent chance they'd seize the actual assets. Really, I don't believe they're any more likely to come take investments away than they are to come take your home. I mean, we're really talking about private property here. If you have $100,000 in a retirement fund, and they say they're going to take that away from you, it's like taking a person's home. I just don't see that happening.

The big question, I think, is this: Are they likely to take away some of the tax benefits – like the 529 plan's ability to grow tax-free? As in, they just come in and say they're making it all taxable to pay the bills they've accumulated up in Washington, D.C., from all their stupid behavior. That kind of thing actually could happen.

-Dave