My husband and I are soon to become parents and our income has been cut in half. Now that we're on a tighter budget, I have realised how much we were caving in to outside financial influence from friends and family. From innocent dinner invitations to suggestions on 'must-have' products for the new baby, the dollars were being seduced right out of our pockets. At the same time, it quickly became uncomfortable saying 'We'd love to, but it's not in our budget' in almost every conversation. It made me feel constantly deprived and I would actually end up spending money to make myself feel better. My husband stopped wanting to talk about our finances at all because he felt stressed out.

After thinking long and hard about our spending habits, I decided there were three main ways that outside influences were sabotaging our budget: social invitations, gift giving, and pressure to buy. Once I specifically identified these influences, it became so much easier to combat them.

Instead of declining every dinner invitation, and feeling bad about constantly telling our friends we didn't have the money, we organised a monthly dinner party for the entire group. We rotate hosting duties, and guests just bring a bottle of wine. Instead of eating out once a week with one or two friends, we now have a festive gathering once a month with everyone all at once - but only pay for a home-cooked dinner a couple times a year! It puts us back in control of how much we spend. I've also realised that people essentially just want to spend time with you, so you can feel free to counter suggest a cheaper and more creative option than going out to dinner. Instead of 'it's not in our budget', I now say 'Would you be up for a picnic on the beach instead? The weather is supposed to be beautiful'. If the plans are set in stone, I say 'We already have a commitment for dinner, but can we meet up with you all for a drink afterwards?'

I also noticed that giving gifts was really adding up. It was so simple to start making my own gifts instead. My favourite is to make chocolate covered strawberries and wrap them up in a beautiful gift box.

To stop caving in to pressure to buy, I've had to change the way I go shopping. It used to be a leisure activity to go with friends on the weekends, but I know I am too easy to influence. It's just inevitable that they will say 'You look great in that, you should buy it', or 'I had this with my first baby, you definitely need it'. Now I shop alone, with a list! I've also stopped taking the bait in conversations. If someone is recommending a $700 mountain buggy stroller, I ask if they know of a more economical brand of similar quality.

The most important way I've stopped outside influence from wrecking our budget is to talk openly about things with friends and family. Through this I've learned that most people are in the same situation. A friend confided that she was deeply in credit card debt and didn't know what she was going to do. Now instead of meeting her for a weekly manicure and lunch date that costs at least $60, we have opened up and become a real support system to each other for reaching our financial goals. It's often perceived as taboo to talk about money with people, but I think our friends have been just as relieved as we are!

Three weeks ago we ended up without a cent to spend on groceries and the money situation for the following week was only slightly better. We had to eat, of course, so I raided the pantry and freezer and managed to get by on what we had. We were also running out of laundry powder and toilet paper so I rationed out these things to make sure we made it through until we could afford to stock up. It meant using less laundry powder per wash and a few less squares of toilet paper each visit, but we got through the week without having to buy anything, saving around $300.

The following week we had only $30 for food shopping. I still had things I could use up in the pantry and fridge/freezer, and the rationing of the laundry powder and toilet paper meant we wouldn't need to buy more until the next week. So I spent our $30 surplus for that week on milk, fruit and vegetables.

Last week we were back to normal but my two weeks of poverty made me realise just how much money I can save each week by using less of everything and trying to use up what I already have in the fridge and pantry. Over two weeks I had managed to NOT spend about $570 and I had also cleared out a stack of canned beans, canned tuna and sardines, frozen vegetables, frozen meat and frozen loaves of bread that were taking up space in my pantry and freezer.

I took on the $21 Challenge, and won! However, my husband was a rather grumpy participant; he loved the savings but not the lifestyle during Challenge week. As he goes away regularly, I decided that every night he's not home for dinner would become a $21 Challenge night for the kids and I - all meals must be made from ingredients I already have at home, and I can only use ingredients that have not been allocated for other meals. This saves money and gives me a night off cooking, as my Challenge meals are usually simple affairs, sometimes as easy as pancakes or toasted sandwiches.

The true value of the $21 Challenge became apparent when a friend was recently diagnosed with a severe form of leukaemia. She is a married mother of four boys and is embarking on a long therapeutic journey that will hopefully lead to a full recovery. As a way of helping her family, the parents at our school have banded together to make all their meals for the next three to six months. As they are a large family, with an above average food requirement, I was unsure how I could afford to help feed them each week. Thankfully, my husband was away the week my friend was diagnosed, so the kids and I lived off the $21 Challenge that week and all leftover money was put into making meals to freeze for my friend's family.

We now do the same thing whenever my husband is away – it's a great gift over the Christmas break to know that I can afford to cook and freeze meals for my friend's family, and look after my family at the same time. Thank you.

We are a family of only two adults who cook often with a large crock pot. However we do find ourselves with a heap of left overs after cooking a pot full of food. So, instead of filling the crock pot with enough food for one meal several times over, we now take two oven bags and divide our meat/chicken/fish between both bags. We add different flavourings to each bag then arrange both bags in the slow cooker and cook on low for eight hours. I have just made Chicken Korma in one bag, using drumsticks that were on special with an extra pinch of cinnamon and some chilli, and Mediterranean Chicken with olives in the other bag. The conflicting smells are surprisingly delightful and the final result is two delicious meals both cooked with the same amount of power I would have used for one. Any extras we don't consume straight away I simply freeze and save for a later date.

Saving $1.00 a day has helped me afford things I would have otherwise struggled to pay for. I started doing this when my sons started at a private school in the city. They would be invited to several birthday parties throughout the year, so to ease the financial burden of gift giving I used my money box. At the end of the year I would use whatever was left to buy school supplies for the following year.

My children have left school now but I still save my $1.00 a day which I use to treat myself to a pedicure, go to a movie or have coffee with friends. It's such a small amount each day that I find it doesn't really affect my household budget, but it always came to my rescue when I needed it, and now affords me my treats.

I pay myself to exercise! Now, you may wonder how that actually saves me money. Because my exercise is free, usually walking with a friend or working out to DVDs I've received as gifts, I don’t have to buy expensive exercise clothes or pay for a gym membership. And paying myself to exercise? That gives me motivation. I started with $1.00 for every day I exercised, and increased it to $2.00 a day - still cheaper per week than a single exercise class or gym membership! I wait until I have enough money for a facial or massage, and treat myself.

I find that the end goal of some pampering really works as an incentive to keep exercising. Prior to this, I never let myself splurge on those sort of things. I am now happier, healthier and far more relaxed!

While searching through the craft section in the Vault, I came across a contribution titled 'Loving keepsakes from recycled clothing'. This inspired me to write in and tell you what I did with my late husband's shirts.
 
He had a lot of flannelette check shirts, which he loved to wear in winter. I cut up the shirts into even squares, leaving the pockets on some squares - I replaced the pocket buttons with gold ones from my button tin. I then sewed the squares together and detailed them by sewing some bright blue ribbon down and across each section. After that, I backed the lot with a flannelette sheet – the end result was a lovely shirt rug!
 
I gave this rug as a keepsake to my seriously disabled grandson, who just loved his Grandpa to bits. My grandson could keep his treasures in the pockets I had left on the squares, as they had a flap that could be buttoned up.
 
Even though Grandpa's Shirt Rug is nearly worn out, my family will always think of it as a special keepsake. I thought you might like to read about my efforts; I just love making something new and useful from something old.

My husband and I have began saving up to $30 per week on our grocery bill since we invented 'Grandma's Day!' When we go to the supermarket we ask ourselves, 'would Grandma have been able to buy this item in her day 60+ years ago?' If the answer is no, then we decide we don't need to buy it either! This saves us money on a whole range of items such as fancy dips, designer coffees and biscuits. We used to pay over $3 for a pack of 10 biscuits, now I can make 12 biscuits for around $1. Using plain yoghurt as a base we are even making our own dips; there are so many websites with great dip ideas. Now we are saving valuable money and our waistlines too!

My kids love doing things on Saturdays but even a trip to the movies for our family costs $70. So I invented '$20 Saturday'. We could go anywhere and do anything as long as it didn't cost more than $20 for the whole day. One Saturday each month we would find a spot in the street directory that looked interesting and take a picnic, other times we visited free places such as museums or community festivals and the $20 bought a drink, small snack or ice cream. Not every place was terrific but we gave each place or activity a score to rate whether we would like to do it again. My boys talk fondly of things we did together and places we visited on $20 Saturdays and they learn that you don't have to spend up big to have fun.

I use a simple principle every day, which helps me save money in all areas of my life. I try to reduce my use or consumption of what I normally do by 10%. The rewards are enormous. For example, if you spend $200 a week on groceries, try reducing it by $20 over 52 weeks and straight away you have $1040 extra in your pocket. You and your family won't even notice the difference, as it equates to less than $3.00 a day!

If you apply this principle to all areas of your life - petrol, electricity, phone calls and so on, the savings are huge even though the sacrifice is not even felt. It not only saves money but also the planet by reducing your overall consumption. Once I achieve this 10% reduction, I do it all over again! Every quarter after the electricity bill comes in, I then set myself the 10% goal anew to keep myself on track and to challenge myself to reduce further. This means the $180 grocery bill then reduces by a further $18 a week and so it goes on. I have done this only to a point where it is comfortable and achievable. Because it is baby steps it is easy and fun and not painful! We have saved hundreds, if not thousands, in the last year or two and are not feeling so pressured by the mortgage rate rises. Best of all is that we haven't noticed any difference to our lifestyle.