By Michelle Kuehner, Financial Coach

What are some expenses you may not realize are killing your finances? Ones that sneak up on you, and keep you living paycheck to paycheck? I was recently asked this question, and my recommendations on how to correct the problems. Here’s what I suggested…

Don’t pack on debt with the holiday pounds

One unintended budget killer I come across when working with clients is holiday spending. Not the obvious ones like Christmas and birthday gifts, but things like Thanksgiving and the Fourth of July. Many tend to think of holiday budget expenses in terms of gift giving. You know, a tangible item. The additional food expense that is required at these festive family events is often overlooked.

For example, this past Thanksgiving, in an attempt to save a little cash on desserts, I opted to do all of the baking…from scratch. However, by the time I had all of the ingredients in my cart, I ended up spending more money than if I had used store bought items. And since I do not normally purchase a lot of desserts during my weekly grocery trip, this was definitely over my allocated grocery budget for the month.

To remedy the situation, I now have a monthly entry to accommodate the additional expense. I also stocked up on many of the items I’ll need right after the holidays while they were on sale. Things like flour, sugar, canned pie fillings, pie crusts, spices, and many other item are typically marked down after the holiday tide passes.

Add a new item to your shopping list

Another expense I find sabotages a budget are the little one-off gifts. The extra stocking stuffer, or bottle of lotion for a friend. While you may have a set amount planned to spend during the holidays, it’s easy to overspend (even a little) and not realize it. One of the best suggestions I’ve heard to date is to only do your gift and holiday spending on gift cards.

Instead of projecting how much you plan on spending for the holidays (birthdays included), budgeting for that amount, and keeping it in a savings account, only make purchases using gift cards. For instance, if you plan on shopping primarily at a big box store like Walmart, with each paycheck purchase a gift card for a specific amount. When the time comes to purchase gifts, ONLY use the gift cards. This is an excellent way to keep your spending on track.

If you are more of an online shopper, you can save even more by purchasing gift cards from sites like Raise Marketplace or Gift Card Granny. Many cards can be purchased at up to 65% off the retail price. The selection of gift cards is enormous (almost 500,000 to choose from), and includes a plethora restaurants, department stores, movie tickets, and gas stations. It’s a great way to stack an additional savings on your gift (or grocery) budget.

Take a different approach

Another suggestion… Don’t carry cash. Let me repeat that, don’t carry cash. One more time: Don’t carry….you get the idea. I know other financial gurus will completely disagree with me on this topic, so let me explain why I’m against the idea.

I had an individual explain to me that one of his budgeting techniques was to carry cash. This amounted to everything he had left over after paying the necessary bills. All grocery shopping, fill ups at the gas station, and dining out were paid using cash.  His goal was to start putting back funds into his employer offered 401k, but was not sure how he could accommodate the decrease in his bring home income.

As we went through his budget, looking for ways to cut back, I questioned (the majority of) his spending. While he knew how much cash went into his wallet each month, he could not tell me with certainty where it all was going.

It’s difficult to create a sustainable budget without knowing where your dollars are being spent. So for the next month I suggested he keep track of each dollar that left his wallet. He was shocked to discover how much was getting fed into the vending machine at his work. He also realized how many boxes of Girl Scout cookies and Camp Fire candy he had invested in. For the following month I suggested he only use a credit card, which he would pay in full at the end of the month. The results were clear. He spent even less with the card.

His weak point was spontaneous spending. The few bucks here and there did not seem like much individually, but collectively added up to a good sum of money. Having to run a card made him more conscience of the spending, while keeping an adequate record of expenses.

The outcome: he purchased beverages and snacks from the grocery store, and would pack his lunch. He saved enough money by making this small change he was able to accomplish his goal by diverting those funds to his 401k, without having to give up his sugary snack fix.

Michelle Kuehner is a Registered Investment Advisor Representative and Managing Director for Personal Money Planning. She is also a Certified Credit Counselor, Certified Financial Health Counselor, writes Fix Our Budget blog, and has over 24 years of experience in the financial industry.