We’ve been taking a hard look at our finances lately, in order to try and make sense of just where it is all of our money goes each month. By far our largest expenses are the mortgage, childcare, and savings, but there’s also some big-ticket debits being filed into the Automotive section (car payment, gas) and holy COW do we ever spend a lot of cash on groceries.
It’s important to us to be pretty aggressive with our savings, for our kids’ sake (college) as well as our own (wanting to retire before we drop dead, enfeebled and palsied) — so reducing savings isn’t an option. It’s important to me to keep working, for many reasons too numerous to detail here, so eliminating daycare isn’t an option. Everything else, though, is up for consideration, and I’ve been thinking a lot about what expenses I consider to be mission-critical.
Well, okay, so none of them are probably mission-critical, unless you count that whole “roof over our heads” thing. We’re trying to lower our mortgage but unfortunately now isn’t exactly a great time for consolidating loans and getting a fantastic low rate. We could move to a less expensive house, I suppose, but since we’re located in the insane Seattle housing market that would basically require building a small grass hut forty miles out of town.
I’m trying to be better about grocery shopping, but there’s just no getting around the fact that household staples cost a lot more than they used to. A half gallon of organic milk costs as much as a gallon of gas, and considering what gas costs that’s just NUTS.
We do pay for some monthly luxuries that I am loathe to give up — specifically, a housecleaning service and a lawncare service. My husband and I feel strongly about being able to use our minimal amounts of non-work, non-family free time for things we actually enjoy, like pursuing freelance opportunities or exercise or hell, just being able to sit down in front of a DVD together. Having someone help keep our bathrooms clean, our kitchen from morphing into a biohazard zone, and our lawn weeded and mowed is beyond wonderful. I appreciate these services so much, and they contribute in a huge way to our work/life balance. Sadly, though, they aren’t free.
Other luxuries I can think of include cable, nonessential kid gear, hair appointments, clothes, our beloved non-gas-conserving vehicles, Netflix, my husband’s occasional diving-related expenses, my once-in-a-blue-moon girls-day-outing to the movies. I don’t want to axe any of these things.
But I suppose that’s what cutting back is all about. And it looks like it’s time for us to get serious about doing so, because even as our income grows, our expenses are starting to grow even faster.
Are you feeling the pinch these days too? What sorts of measures have you taken to reduce your family’s spending?
We are currently carrying 2 mortgages (our house didn’t sell before we took possession of our new house) so…. yeah. It’s not so much a “pinch” we’re feeling, as a large bite. The housecleaning service is not optional - although my nails and my iTunes habit have taken a hit (among many many other “wants”!) Interested to see how others are cutting back, because I feel like we should/could be doing more, just not sure how to go about it.
mrsgryphon | July 25th, 2008 at 6:02 am
Money is always an issue in my house too. The fact that you are able to save every month is fabulous and means you are on the right path. Little things you can do to save more that won’t hurt “too much”. Get credit cards that offer rewards - how much does that really help? One of mine gives me 5% off all gas purchases, another gives us $20 in free Blockbuster rentals every month (a la no netflicks). You Do spend a lot on groceries, and there are a TON of ways to save - buy in bulk, coupons, shop sales at several stores. (I think buying 1 apple at a time via AmFresh might be the MOST expensive way to shop). Also a little known but HUGE savings I just discovered is that I can get my FORMULA for $5/month as a perscription! 10 - 24.oz cans ($250 worth!) for $5 a month - we have BCBS with Medco as our prescription service - but WOW does this save me money!
ELC | July 25th, 2008 at 12:29 pm
I’m very comfortable financially and this article made me nuts. There’s no useful information about how to reduce expenses and instead it just seems as if the author wants to reveal all of the luxuries she’s simply not willing to do without, end of story. What’s the point?
Laura GF | July 25th, 2008 at 1:38 pm
As the author of the post, Laura, I’m sorry I couldn’t offer you more useful information on how to save money — although if you’re so comfortable financially, I’m not sure why you’re looking for it. I meant to start a conversation, not give anyone a set of instructions. I’m wondering if other people are looking at cutting back on their own expenses and how they feel about it.
ELC: I do feel compelled to say that I never buy one apple at a time. We eat a LOT of apples around here! : ) FUJI FTW!
Linda | July 25th, 2008 at 2:44 pm
When times get tough, I think everything has to be put on the table for consideration to cut.
We recently dropped Netflix (in favor of the library’s free DVD rentals)…brew our own coffee…my husband always takes leftovers to work…we love dining out, but only do that out once a month at a reasonably priced place or takeout…in other words, you can TRIM expenses without eliminating the ones that make life fun (e.g. instead of going out for a full breakfast at our favorite diner, we buy or make muffins, bring our own fruit salad from home and sit by the river…still get our breakfast date, but save lots while doing it and get a million-dollar view to boot).
We are also driving less…plan to wear ski parkas (well, practically!) inside our house to cut heating oil costs this winter…and do not buy organic milk/fruits/vegetables.
We don’t buy new clothes or the latest gadgets. We have the lowest possible rate on our cell phone & use it minimally.
We have high-deductible insurances (home, health) that bring premium costs down. I’ve also discovered that Freschetta and DiGiorno frozen pizzas are delish — cost way less than Domino’s and you don’t have to waste gas driving to pick them up.
I do a “Girls Night Out” once every few months with my friends, but all of us are feeling the pinch. Rather than dine out at a restaurant at $40-70 each, we recently did a picnic by the water and saved a TON and had the best time.
It’s all about options. But we’ve got to get real about what really constitutes “necessities.” I think we often confuse luxuries with them.
Jeannie | July 25th, 2008 at 3:00 pm
This is so funny! We did the exact same sit down this last weekend. Gas & groceries have evaporated our fun money! We are doing a lot of the stuff Jeannie said. Using more cash instead of debit cards has helped, too. Also, we are making our own coffee instead of starbucks. The biggest thing we have done is to choose to drive less. We are being more particular about where we go. Being in a suburb of Houston, everywhere we go takes a quarter tank of gas! But, like you said, moving isn’t an option now. And hey - we came to the mutual decision that a cleaning lady is just preserving the value of our home because we both know that no matter how much we SAY we will clean, our house would go to seed without her. Times are tough - but how blessed are we to have so many options!? Even to be able to have internet access - we are richly richly blessed!
QueenBee | July 25th, 2008 at 4:26 pm
i’ve switched from grocery stores to farmer’s markets for my produce and cut my grocery bill by 25 - 50%, depending on what i buy for the week. Plus the produce tastes better and the shopping is just more fun.
i also scoured my cel phone, home phone and auto insurance bills for places where I could save money and cut a good $50 a month off of my overall expenses.
And my fiance and I are having date night at home more often . . . a bottle of wine, either home made dinner or a nice take out, and a movie from blockbuster. That runs about $35 instead of $100 for dinner and a movie out . . . and its preferable in ways (like I can pause the movie to pee if I need to)
Hollylynne | July 25th, 2008 at 4:37 pm
Linda, thanks for trying to clarify. All M&C posts come to Bloglines automatically, I didn’t come here looking for money saving tips (and thank goodness for that). I don’t know, it just seems like you were starting this conversation in a pretty weird way if you were really interested in how other people were trying to save. The whole article is basically a list of all the unnecessary items on which you choose to spend money and finishes with you unwilling to cut any expense right now. You then invite people who can’t afford to keep all their extras to share how they will reduce their spending. It’s that contrast that’s jarring, with you positioned as a well off voyeur.
Laura GF | July 25th, 2008 at 4:52 pm
My “food” purchases tend to be on the high side by category, because I try very hard to stick with organics. The offset is that I don’t buy a lot of stuff others consider to be staples: meat, juice, pop, desserts (we use fruit), snacks, alcohol, many processed foods, and prepared foods (e.g., microwave dinners). I cook little, preferring to eat and serve whole, uncooked foods to the extent possible. I recycle all leftovers. I don’t “buy” lunch or coffee or pretty much anything “out,” except for our weekly dinner with friends (yes, that’s a luxury). I work from home about 9 days out of every 10, and try to shop for 2 weeks of groceries at a time (since my g.store is 25 miles away), picking up milk locally in-between. When I do drive, I keep it at 55-60mph which gives the best gas mileage. I potty-trained early so my kids were out of diapers at about 1.5, and this saves on a ton of other products too. I eat what my kids eat and vice versa - quit all “baby” food products before my wee one was 1. I keep the AC off as long as we can stand it, and lights are off until after dark - we work by the windows. I rinse most dishes immediately with water (a little soap if needed) rather than run the dishwasher frequently. I re-use everything I can to minimize laundry (probably average 2 loads a week max for 3 people). I’m sure there are lots of other things, but these are the ones that come to mind right away.
SKL | July 25th, 2008 at 5:08 pm
Oh, and I pay down principal if it will save me more interest (after tax/employer match) than the interest I earn on savings. I became debt-free several years ago, and it is a HUGE boon. In the long run, it has enabled me to save way more than I otherwise could have.
SKL | July 25th, 2008 at 5:14 pm
I think you can really save on your grocery bill by must getting a little more organized with your shopping. I usually make a “menu” of things I’m going t ocook. Usually at least 10 meals. Then I itemize those meals and shop for just that. If I can make less trips to the grocery store, I’ll spend less money. I also make it a conscious effort to shop the perimeter of the store: veggies/fruits and meats, etc. If you make your own meals rather than buying the processed stuff usually found in the middle you can save money.
Also, what about shopping around for home insurance and/or auto insurance, etc. Make sure you are getting the best deals.
I totally know where you are coming from with the housecleaning/yardkeeping service, I wouldn’t get rid of that either. I have 2 little ones at home and this makes a huge difference. We can’t afford them, but I WISH we could. :o)
Leticia | July 25th, 2008 at 5:51 pm
Wow, this is one we’re working hard on, particuarly since my husband and I are both temping right now.
I try to go to the farmer’s market whenever possible for fresh fruits and veggies. Sometimes they’re cheaper, sometimes not, but it’s helpful to check. I also go to Aldi once a month or so - I don’t buy a lot there, but they have good stuff on special buy. One month I got 4lb bags of oranges for 99 cents each; I think I bought 5 bags!
I’m working on cutting coupons and looking for them online. I also get emails full of coupons each week. I am thinking about one of the Mrs. A’s coupon organizers to help me keep them straight.
I do my own nails, we cut our own grass. We eliminated our landline phone and are cell-only now. We dropped our extra channels and kept just basic cable. We don’t go out to eat a lot, and when we do it’s usually something cheap and close - just the getting out of the house that we enjoy.
I’m also buying tons of stuff at Ross, TJ Maxx, Marshall’s and even the thrift store. You can get really nice stuff much cheaper and no one would ever know - unless you’re like me and just love a good bargain!
The one thing killing me right now is my car. It truly needs to be replaced but I am putting that off as long as possible. I will not be buying another new car, and am searching for an inexpensive used car that is a bit more reliable than mine. I hate taking on that burden now, but my car will cost more to fix than is worth it in the long run.
Kelly O | July 25th, 2008 at 6:01 pm
A big one for me was to stop buying books (waa) and strictly use the library. That saves a ton of money. I also use the subscribe and save feature on Amazon (which if used saves you 15% more) for diapers and most household items and some canned food, it is more money upfront but ends up saving us quite a bit. We have been going to the U-pick farm too, I can buy a flat of raspberries for $5 where at the store it’s more like $16, WTF. I second that people should periodically check their house and car insurance policies, this can be a big money saver.
Ashley | July 25th, 2008 at 6:07 pm
Laura, not sure how to explain it further except I will say I am in the midst of cutting expenses even though it’s HARD and I would rather NOT, and wah, and I like hearing other people’s ideas.
KellyO: I am ALL ABOUT the thrift store shopping and Ross/Marshall’s etc. It’s almost more fun that way because you never know what you’re going to find!
SKL: going debt-free is a big goal for us. We have one credit card that keeps getting paid down, then we run it back up. Lather, rinse, repeat. It’s one of the reasons I’m looking at where our money goes and planning some changes, because we need to start funneling more cash onto the damn Mastercard.
I’m with some of you on the little things adding up — we hardly ever buy Starbucks anymore, and we ditched our landline a while back and only use cells. Small changes, but if you make enough of them . . .
Linda | July 25th, 2008 at 6:13 pm
What’s up with Laura? Of all the crazy blogs out there, not sure how this one gets someone worked up.
I’m with you, feel like the little things are all I’m ready to give at this point. Honestly we’re ok financially but I always feel like we should be saving more - whether for our next house, college or even a vaca.
I think someone else mentioned the library. I’ve been going there for all my books and to try workout DVDs before I buy them. I’m turning into a little bit of a crazy person telling people they should use the library b/c it’s FREE, as if this is a new concept.
We also have a free fancy coffee machine at work so I’ve eliminated Starbucks lattes by making my own mix of milk (also free at work) with chocolate espresso. Believe it or not I actually now prefer this to Starbucks.
Food is definitely our biggest expense. We don’t eat out much but we have a grocery store right at the end of our street so we’re guilting of making a lot of trips and not planning our meals. My sister puts together a dinner menu at the start of every month, which I recognize is such a good idea but just can’t get myself to do.
Christine | July 25th, 2008 at 6:33 pm
Linda - Thanks for clarifing about the apple. I saw it on a grocery list post of yours a while back and obv. it struck me as odd enough to remember for this long. Needless to say I am relieved!
ELC | July 25th, 2008 at 8:06 pm
The nails went down the river. Now that I have paperthin, real fingernails, I’ll never get fakes again - too painful to stop getting them donr. I also stop and think before I drive. I live in a small town outside of Madison, Wi, so it’s 20 miles roundtrip just to get to the limits of the city. I usually bring a lunch to work each day because that’s another trip in the car or paying for delivery. I’ve always paid my credit card off each month, but that’s getting harder and harder. I was used to getting what I want when I want. Now I have to think about what my balance is at or should I wait. Lately, when I’ve waited, it never got bought because I realized I never really needed it and the want was temporary.
Val | July 25th, 2008 at 8:38 pm
My biggest cutback has been on gas - I commute by bike and make a list of all the errands I need the car to do. Then once a week I get out the car and run all the errands on the same trip.
Second biggest cutback has been the food bill. I watch for sale prices on fish, meat etc. then I stock up and divvy it all into single-meal sized portions and store each in the freezer. Meanwhile I buy a LOT of dried beans (cheap!!!) and local produce - whatever’s in season - and do meals with all whole foods. Lots cheaper than anything pre-processed. You can also make huge batches of stuff (bean chili, burrito fillings, spaghetti sauce, enchilada casseroles) and freeze them all too. Take advantage of buying/cooking in bulk.
It is tough though. And we all have to keep our favorite indulgences. Instead of a housecleaner, my indulgence is a latte from the local independent coffeehouse. After cutting back on everything else, getting that latte is like getting pure gold.
Jennifer | July 25th, 2008 at 11:36 pm
A great book to read on this topic is “All Your Worth” by Elizabeth Warren. She talks about how to set up your life so you have your needs, wants, and savings in a 50/30/20 balance.
I also highly recommend a fantastic and inexpensive program for creating and tracking your budget — see http://www.youneedabudget.com
SoftwareMom | July 26th, 2008 at 12:03 am
Drop a few of the freelance jobs and you would have the time clean or cook better. Ditch some of the organics. Or use them less. Commit to keeping your cars for a long time. Or sell and buy something pre-loved. (I know… corny way of saying used.) Eat more lentils and beans — they’re way cheap and super healthy and there are tons of ways to cook them. Also, really look to see how much your spending on childcare in comparison to how much you are earning. Are you working for childcare?
For us, a fam of almost four, living on less than 20k a year in the midwest, we rent instead of own our home (our gas is free), don’t eat out much anymore (my personal downfall), try to keep the groceries to 60 bucks a week, drive less… some days it really sucks. My kiddo wants to go out to McD’s or other “fun places” but you just have to say no. If you want to cut back, its a committment.
aoife | July 26th, 2008 at 3:55 am
We are living on a really tight budget for a couple of years and let me hasten to assure, cutbacks have been made! The meal planning and sticking to the list at the grocery story (or ordering online) thing is key. We don’t eat meat and eat tons of beans- buying canned on sale and dried otherwise (once you have some surefire recipes and a good system down for soaking/cooking, its all good). Nor do we get processed foods beyond mac and cheese. Our clothes usually come from thrift/secondhand stores (or ebay) or we get them as gifts for holidays/birthdays. No Netflix- if we are dying to see a movie that the library doesn’t have, we rent it from our local place (the $4 is less than the monthly Netflix fee, obviously!). We are library lovers as well. We walk or bike most days of the week and our little car is 10 years old. We rarely eat out or get take away. No mani/pedis for me. No housecleaning (sadly). We rent a really sweet but modest house which we’ve furnished with pedestrian furniture. No cable. We watch our energy consumption (get -or better, borrow- a Kill A Watt). I am a big believer in organics being better for our planet and our bodies so I put extra money into that. I take out cash at the beginning of each pay period for our allotted food budget and if we run out at the end of the time frame, well…we all like peanut butter and jelly! (we keep a well stocked pantry so it sometimes just means the last week of the month calls for a bit of creativity) I ask (for myself) for gift certificates for my bday and holiday time so I can go shopping throughout the year without feeling like I *never* get to get anything for myself. We planted a little kitchen garden so always have fresh herbs and lettuces available (this was minimal cost and effort- we are not master gardeners!) and will soon have beans, peas and tomatoes. I read a lot of personal finance blogs which both inform and inspire in terms of debt reduction/avoidance, budgeting and saving. I also know people in much worse situations financially who are really struggling and hurting right now so despite it feeling quite tight in our home sometimes, I count my blessings.
J | July 26th, 2008 at 8:17 am
We were in the same boat awhile ago - we made good money, but I kept wondering where the hell it all went. Then my husband got laid off in April and it was time to get serious. Like many others here have mentioned, we stopped eating out, brought our own lunches and coffee, it hurt like hell, but we got rid of the cleaning service (my husband took up some slack there), we went down to very basic cable, ditched Netflix, menu planned, got rid of anything other than very basic cell service, and I completely stopped buying clothes. I realized I had a ton of stuff in my closet that I wasn’t wearing because it didn’t fit right. So I found a good tailor and got my clothes to fit me. My husband got another job in June, but we are keeping up with a lot of these things (rehired the house cleaner though because holy crap our house - ew) because they didn’t hurt that much to start with, so why not. The creeping spending thing sucks, I feel your pain.
MRW | July 26th, 2008 at 6:48 pm
Costco! A huge thing for us has been saving on the baby stuff via Costco. One trip paid for the membership. We don’t have tons of storage so I don’t buy as much of our food there as I would like (though with Costco you really have to price check and know what things cost).
I think a lot of us are feeling the pinch because we had budgets that worked before but now with food and gas prices are rising they don’t anymore.
I really hate when people ask if women are “working for childcare” because . . sigh . . do we have to get into this? There are all kinds of reasons to work that don’t have to do with current salary (maintaining a work history, retirement savings, etc) that I think that it is foolish to assume that families haven’t considered all of this before making their choices.
Anyabeth | July 27th, 2008 at 2:05 am
My fiance and I live in a very cheap apartment, by Seattle standards at least, to sock money away for savings that will head to a home and such. It is a tiny (under 500 sq feet!) and has almost no storage/closet space which has the added benefit of making us think twice before buying something.
We don’t really live on a tight budget as we have no mortage, no children and we own our older cars outright. But that doesn’t mean we haven’t noticed more money going out the door in recent months that could be saved or put to better use.
I have been shopping a combination of Costco, farmers markets, produces stands and Trader Joes. I try to buy organic and eat whole food but I am willing to bend the rules on many items. Such as I will buy milk that is antibiotic and growth hormone free instead of the $2 more a half gallon organic. I cook a lot and we bring our lunches.
I also use the library a lot, books cost a lot and take up space! Often the library doesn’t satisfy our movie fix though, Netflix is a better deal for us than how much we were spending on rentals and lates fees.
Also, I completely disagree with the above commenter who told you to drop your freelance jobs to have time to ” clean and cook better”. If the freelance work is what you would rather be doing, and is helping to bring in money to cover the cleaning/lawn care it seems like the clear choice. Obviously it is part of what makes your life satisfying. Anyabeth said it all about you “working to cover childcare.”
sara | July 27th, 2008 at 10:11 pm
Love that logic from aoife: “Stop doing [the thing you enjoy that pays you money] so that you can have more time to do [the things you find tedious and would rather outsource].” Sign me right up for that! Sheesh.
We are not actively hurting, but we were looking forward to a big jump in income as I finished professional school. However, my graduation coincided with my husband losing his job. So now he is freelancing and we will probably have about the same income as before, except with higher expenses, since we moved out of grad-school housing and are now in a real apartment with real rent.
Like many of the above posters, we are taking a close look at our grocery expenses and trying to eat healthier for less money. For us, this mostly translates into eating meat only a few times a week and trying to eat out less often. I have stopped buying coffee and make my own lemonade-green tea at home instead of going to Starbucks. I buy my books used or via Paperbackswap.com or use the library. Hopefully, the fact that we have moved to a neighborhood with fewer cute little stores and cafes will also lead to lower expenses, although we are now 2 blocks from a Marshall’s, which could be dangerous.
Liz | July 27th, 2008 at 11:34 pm
This is all very helpful, thank you to Linda for starting this discussion! As a single person with only a dog for a dependent, I am trying really hard to get myself in order so that someday, I can run a household without going broke (or crazy). Or both.
Thanks again!
Jamie | July 28th, 2008 at 4:16 pm
It’s actually comforting to see so many others also feeling the crunch and doing something about it. I live in an affluent college town where it often seems like everyone else has a big new gorgeous house and a season pass to the (new, gorgeous, expensive) city pool, and we’re the only family in a small townhouse and a rule for our girls that we can only do the pool once a month.
I empathize, Linda, with the pain you’re experiencing when considering foregoing all the “extras”! But it is possible, and though it makes life hard, and yes, more tedious, it doesn’t mean life can’t still be fun.
We gave up our cells, don’t have Netflix (check out free DVDs at the library), own only one car (husband bikes to work), don’t buy any organic although believe me I’d LOVE TO, don’t travel (pretty much ever), never eat out anymore, and do all our own cooking, cleaning, and gardening. Yes, it’s a huge bummer to spend one’s “free” time doing chores. Yes, I would love a cleaning lady. Reality: we can’t afford one.
I try to remind myself daily of the positive trade-offs of a frugal lifestyle: better for the environment, teaching my girls the value of non-material things, less stressful than living with credit card debt, etc. It’s not easy, but many, many families have no choice in this economy but to make these sacrifices. Good luck to you!
Shannon | July 28th, 2008 at 6:06 pm
I stopped brushing my teeth and my husband stopped wearing deoderant. I mean hell, that saved us like $6 a month. We are rolling in it now. We decided it was either our personal hygene or starve the dog and cat.
Just shitting you, but wow, it is like the critism jumped over here from PD. I stopped reading over there just bc of all the drama. I think perhaps some people missed the idea that you are not wanting your own lifestyle critiqued but wanting to hear things that others are doing.
OK, back on task. I started riding public transportation. The university I work for pays all but $5 of monthly fee for the bus pass. My husband is driving my gorgeous 1997 Chevy Cavalier (he likes to pick up the chicks in it) instead of his gas guzzler truck. Since he started began his PhD two Januarys ago, we have not been out to eat more than two or three times that we have paid for it. Since we severely cut back there, we do not really ever cut back at the grocery store. We also make an effort to use what we have at the house. So instead of going to the store and picking up another jar of this or box of that, we look before hand to make sure we don’t have it already. We also make an effort to use what meat / other food product we have on hand rather than buying something else just because we want it.
We have fairly basic cable and a family cell phone plan with a provider that allows free minutes to others on their service. That saves us a ton since my husband likes to talk on the damn phone all the time.
I have started making some of my own cleaners, not for the $ but for the natural aspect of it. It is amazing how well baking soda mixed with a couple of other ingredients works to clean so many things.
Next up I am going to stop shaving. I know my husband will love that!
Stephanie | July 28th, 2008 at 8:27 pm
We’ve paid closer attention to out eating out/take out habits and have decreased that. We have high speed internet and digital cable and our provider has a two year lock package with phone that we’ve signed up for so that will save us $30 a month for 2 years. School starts back in a month so that will save us about $300 a month. Really watching the grocery budget. The other thing I’m doing is checking on all of those little programs in my life that I earn “points” from and cashing them in for gas cards, etc.
aftercancer | July 29th, 2008 at 3:52 pm
We just try to live below our means so we can splurge occasionally if we feel like it.
I think I would much rather have experiences than things anymore.
It helps to make a budget matrix with cost categories going down one side and columns going across the top: Importance, Variability and Frequency
Food has a high importance, a high rate of variablity so you may need to look at your budget for food more frequently and tweak your spending in other categories.
It’s a tool to help focus quickly on what is important and what may be wrecking your budget.
nicole | July 30th, 2008 at 3:50 am
I just took a 60% cut in pay to take a job that makes me happy. So while I don’t have any kids, the change in income means I have to cover ever increasing expenses with a much, much smaller balance in the checking account. I too had to take a hard look at my luxuries and sadly, cable and netflix did not make the cut. But at least I have my internet! With so many blogs to read, who has time to watch TV?
cat | July 30th, 2008 at 5:38 am
Cost avoidance is my plan - take advantage of what you have. I have a gym membership, so I didn’t get a pool membership for the summer. Since the gym is a ways to drive, I combine trips - we go to the pool every Mon and Weds after my strength training classes.
Walking to the store (I am a SAHM, so sometimes just filling a day is hard) gets us a healthy activity (my son bikes!) and saves gas.
Sell the crap in your house on Craigslist - declutter AND make money!
Surveys!
Elisette | July 31st, 2008 at 9:03 pm
Hi Linda…I live in Canada, so not sure how available this option is for you, but I thought I’d put it out there.
While on mat leave this year after having my second child, I took the time to sit down and go through our expenses - what comes in and goes out monthly (I shouted profanities out loud when I discovered that our monthly groceries were taking almost a whole week of my husband’s paycheque!) Anyway, it got me researching serious options to become debt free quickly. I came across a bank called Manulife One (again, it’s Canadian, but if you google it, I am sure you may find equivalents in your banking market). Basically, instead of the standard operating procedures for mortgages, this bank holds your mortgage as a line of credit, loaning you up to 80 per cent of the current market value of your home, and your interest is accrued DAILY so the longer you can leave money in there, the better. There is no minimum or maximum monthly payment. With our previous bank, we still had 17 years left on our 25 year mortgage, and with Manulife One, we will be done paying it off in 6.5 years - as long as we make the EXACT SAME monthly payment to the account as we currently do - and I cannot even tell you how exciting it will be to have that extra cash floating around! Apparently, this is the way mortgages are done in Australia, and parts of Europe, although it’s relatively unknown here in North America. Its downfall is that if you (or spouse) are undisciplined, you could, at the end of a couple years actually owe more than you started off owing, but for myself, I only wish I’d discovered it sooner!
Jenn | August 1st, 2008 at 12:42 am
I could cry. We are SO hurting financially right now and (I hope this doesn’t sound bad) it really makes me feel better to know we’re not alone. So thank you for getting this discussion started.
We rent an apartment and have have all utilities paid except electric (usually $50/mo). We only have one car and will own it next year, plus it has really good gas mileage. We hardly ever eat out. I don’t buy new clothes, we hardly ever go to movies, and I watch where we’re driving so we don’t waste gas.
We live paycheck to paycheck right now because of the baby’s medical bills. That, plus daycare, is killing us. We are paying the total of two car payments in PAYMENT PLANS to cover what insurance didn’t for NICU, labor and delivery. And when I went back to work my milk dried up so I can’t breast feed anymore, so we have the major cost of formula to add to the mix as well.
We work really hard at packing lunches and not getting lazy by picking up fast food. I hardly ever get my hair done, and we buy generic brands whenever possible.
Honestly, I don’t know any other ways to cut back since our expenditures have increased dramatically with the baby. Freecycle is helpful, and so is Craig’s List but that’s not enough. I’m looking for a better paying job and so is my husband because it seems like the only way out is to bring in more money.
I try to put things in perspective though, and realize we’re not alone and sadly there are people a lot worse off than us. We have jobs and health insurance (although both crappy) so that’s something. Plus a perfectly healthy baby–and iin the end it’s all worth it.
Yeah crappy economy and George W. Bush! I can’t thank you enough!
samantha jo campen | August 1st, 2008 at 7:39 pm
Little things like making my own coffee and restricting coffee purchases from Starbucks et al to a once a week treat. This saves me a load of money because I used to buy 1-3 fancy coffees a day at Starbucks in the $3-$5 range and that really adds up.
I won’t compromise on quality food and continue to buy organic fruits and vegetables. I don’t eat a lot of meat or cheese so I suppose I save money there.
Because I live in the heart of the city, I take public transit (in Canada bus passes are tax write offs at the end of the year - you get 30% back) and walk as much as I can for the exercise. Work is an hour’s walk away one way and the walk is very pleasant. I do not own a car and rent one when I need to, thus saving on insurance, gas, and car payments. I’m considering joining a car co-op which would cost $500 a year. Though I might buy a smart car (they’re incredibly cheap and get good mileage).
I don’t go out to movies much anymore, not so much because of the cost but because too many people behave like assholes in theatres now and I hate that. So its mostly DVDs and going to the movies when seeing it on the big screen counts (like the latest Batman flick).
One big savings area is clothing and shoes. I very rarely shop for new clothes anymore because I have buttloads of clothes and usually when I look in my closet I wonder “what the hell were you thinking?” I work at home mostly so I don’t have to dress up anymore for work, which is a plus. I used to buy so many items of clothing at full price. I have no desire to do that anymore.
When I shop for furniture I invest in things that will last for many years. It may cost more up front but in the end it’s worth it.
I avoid using credit cards now and the credit card I have has a very low lifetime interest rate of 5.99%. I keep this for emergencies.
When I go on vacation I look at things to do that are economical. For example, I wanted to do a personal health retreat and instead of going to one of those fancy hugely expensive spa resorts, I’m going to a yoga retreat on one of the Gulf Islands hosted by a local person who owns a lovely house there. The entire week will cost $750 including organic meals vs the health spa @ $5,000. I think I’ll get more out of it, too.
Anyway, just a few things I do. I wish I’d gotten a start earlier in my life with savings, but it’s never too late and I’ve got a nice nest egg built up. Plus my work has a great pension plan, so I won’t have to worry past retirement.
Lesley | August 3rd, 2008 at 11:04 pm
P.S. Forgot to add! I gave up my pricey gym membership and work out to DVDs at home. I bought a set of hand weights, yoga props, and pilates stretch bands, stretch tubing and a gym ball and I get as good, if not better, workouts than I ever got at the gym.
Lesley | August 3rd, 2008 at 11:07 pm
Like someone else said, you wonder if others are feeling the economic pinch when you see the big house and the Lexus in the driveway! A lot of us are definitely in the same boat.
I drive 60 mi/day to work, and here in Phoenix our public transportation sucks so the most helpful thing I’ve done so far is carpool It’s saving about $100/month. NO, it is not convenient!! we have to spend a lot of time coordinating schedules, and I have to forego some of those things I used to do on the way home from work. But, it’s all worth it and thank goodness we have a deal not to talk much in the mornings
I also try to combine errands when I can, and before going out for happy hour, have a couple of drinks at home first (if I’m not the driver of course.)
Julie | August 4th, 2008 at 2:46 am