Last Updated on April 8, 2023 by Erin
After years of supporting children and paying off debt, money can be tight for many of us reaching midlife. Or maybe you’re like me and you’re considering a midlife career change and want to get your finances in order. This is the time when we want to start living the good life! The great news is, there are several easy money-saving tips for midlife women to get the most bang for their buck without sacrificing their quality of life.
You don’t even need to be entering midlife in order to start practicing these habits. The earlier the better!
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Money Saving Tips for Midlife Women
Track Expenses
First and foremost, take stock of where your money goes each month. Track all expenses and see where money is being wasted or can be cut back. If a gym membership isn’t getting used, it may be time to cancel it.
Once you are able to determine where all your money goes, you can make sure it goes towards things that you truly value, such as travel. Look at all of your accounts, including checking and credit cards. Take note of your fixed and variable expenses.
Fixed expenses don’t change from month to month. Examples include mortgages, utilities, and insurance.
Variable expenses fluctuate each month. Examples include food, clothes, and entertainment.
When I finally sat down and looked at all my expenses, I discovered a few subscriptions that I had forgotten I had signed up for. I was able to cancel those and start saving that money. BillTrim is a free app you can use to negotiate and cancel subscriptions. Give it a try!
Decide on a Budget
Once you’ve got your expenses all laid out in front of you, it’s time to determine a budget. This is one of the best money-saving tips for midlife women to keep in mind.
50/30/20 Budget
A 50/30/20 budget is a fairly common budget to get you started.
50% of budget = needs
30% of budget = wants
20% of budget = savings
To implement the 50/30/20 budget, you need to start by determining your monthly income after taxes. Then, you allocate your income into the three categories as described above. You can use a budgeting app or a spreadsheet to track your expenses and ensure that you stay within your budget.
One potential downside of the 50/30/20 budget is that it may not work for everyone, particularly those with high debt or expenses. In some cases, you may need to adjust the percentages to better reflect your financial situation.
Envelope System
Some people utilize an envelope budgeting system. This method involves dividing your cash into envelopes for different spending categories (such as groceries, entertainment, or transportation) and only spending the money in each envelope for that specific category. This can help you stay within your budget and avoid overspending.
One downside of the envelope system budget is that it can be less convenient than other budgeting methods, particularly if you prefer to make purchases with a debit or credit card. However, you can still use the envelope system budget for certain categories (such as discretionary spending) while using other budgeting methods (such as a digital budgeting app) for other expenses.
Zero-Sum Budget
This is a budgeting method that involves allocating all of your income towards specific expenses, savings goals, or debt payments. This can help you stay on track with your financial goals and avoid overspending.
To create a zero-sum budget, you first need to determine your monthly income. Then, you allocate that income towards different categories, such as housing, transportation, groceries, utilities, entertainment, and savings. You can use a budgeting app or a spreadsheet to track your expenses and ensure that you stay within your budget.
The key to a successful zero-sum budget is to be realistic about your expenses and to prioritize your spending based on your goals. For example, if you’re working to pay off debt, you may need to allocate a larger percentage of your income toward debt payments. Alternatively, if you’re saving for a down payment on a house, you may need to cut back on discretionary spending to allocate more money toward savings.
Tracking Finances
I have been using Empower for a few months and really enjoy how it tracks EVERYTHING for me. On my website dashboard, I can see the budget they recommend for me, my cash flow (income and expenses), and my net worth. There are a lot of other offerings on Empower but the basics are great to get you started.
Knowing your net worth is important because it gives you a snapshot of your financial health. Your net worth is the difference between your assets (things you own, such as savings, investments, and property) and your liabilities (things you owe, such as debt and mortgages). It can guide your financial decision-making and motivate you to work towards your long-term financial goals.
