Everyone today is concerned about the economy and inflation. We are all trying to find ways to cut our expenses and still maintain a similar standard of living. There are several approaches we can take that might help us trim our expenses.

The first suggestion is to write down every single item we purchase. This is similar to keeping track of your calories in a diet and it actually can work. Do not generalize your list but record each and every item. You will most likely buy less because you realize you will have to go home and list everything purchased. This should be done for several weeks. Each week, review every purchase made and you will soon be aware of a number of them that you could do without. Skipping a few items each week can result in substantial savings. This will take discipline, but could be well worth the effort. Remember, you must list every item from a carton of eggs to a major purchase.

The next step to consider is paying for every item you purchase, even the large ones, in cash. I am referring to dollar bills, not debit or credit cards. This can be an amazing step towards spending less. Statistics have shown that a person using cash in place of plastic will cut their spending an average of 26 percent. When your cash has been spent, you must go to the bank and get more because you are not using any form of debit or credit card.

Of course, in order to cut expenses, you need to establish a budget. This will enable you to purchase the items you and your family really need while avoiding the unnecessary expenditures.

It is very important to know the difference between credit and debt. Credit is something over which you have some control. A purchase on a credit card, or a loan, which can be paid off at anytime is a credit. Debt is something you are unable to repay which eventually controls you, such as a mortgage higher than your home value. Think about this every time you are tempted to purchase something that you can well do without.