Ways to reduce budget

[Birdie Num Nums]

Since I ER'd last year I have....well, changed virtually none of my spending habits.

I have always been rather frugal since I was very young--when I first got money by a monthly allowance, mowing and weeding lawns, and delivering early morning newspapers. I always kept my expenses low, and saved, saved, saved. Over these many years I have not felt deprived by not purchasing things I don't really need or want.

But I do continue to splurge for stuff that I personally enjoy.

The only significant difference, now that I am ER'd, is that I have to figure in individual health insurance as an expense. But that's about it.

 

[Mulligan]

Everytime I cut back on something which seems to only reduce expenses by an inconsequential amount I multiply it by 10 to really appreciate that the savings is considerable over a decade.

LauAnn - The list you created would definitely save a lot of money. But most of those would cut through the muscle and into the bone on my lifestyle. I would rather go back to work than go without a/c at my house. Although my dad when I was growing up didnt think we needed it much. But that is a place back in time I do not want to go back too

 

[arebelspy]

Was so impressed by the thread below of budgets and expenses for 2011, I thought I was frugal and now believe I am a fat spender after reading about people that love on 12k per year. That is amazing! So you have all inspired me to clean up and overhaul, however it seems like every time I try and cut back I get stuck. Could you please share the three best thing you have done to cut your expenses?

Thanks in advance for sharing

www.earlyretirementextreme.com is a lot more about the frugality side of finance than these forums. Some great ideas in here, and if you want to read even more, go to their forums.. You'll find literally dozens of people living on 12k or so per year.

 

[Wrirya]

Coupons, coupons and more coupons. My wife only buys what is on sale and then uses coupons on top of sales. When she or both of us go to the grocery stores we buy a lot of loss leaders and in bulk if we can. This works especially well also if you like the product. No sense in buying things cheap just because they are cheap. It all adds up and then when we go out and have a good time or dinner once in a while we have the extra money.

Talk to me about these coupons. I have watched the extreme coupon show and thought it was amazing to get all your food for next to nothing. The problem it seems so impractical to get 50 coupons for something. How do you guys do it? Any tips

 

[arebelspy]

Talk to me about these coupons. I have watched the extreme coupon show and thought it was amazing to get all your food for next to nothing. The problem it seems so impractical to get 50 coupons for something. How do you guys do it? Any tips

The wife and I are pretty frugal, but couponing is a waste of our time. I can make more money writing freelance online for an hour than I can couponing for an hour.

If we happen to see one, we'll use it. But going to search and clip? Meh.

We definitely buy on sale, and you can see from our budget in that thread that we do spend a fair amount on food, but we try to cut back in other areas that aren't as important to us. Conscious spending and all that.

But some enjoy it. If you enjoy couponing, go for it. I'd wager for most people just buying stuff when it's on sale will save them more on the stuff they actually want than coupons will.

 

[ripper1]

It is really just a matter of prioritizing expenditures (within your available budget) based on what you really want out of life. For example - I'm retired now (since early 2010), and my wife and I really like to escape the northern winters for 6-7 weeks and spend that time in a warmer place. That is very important to us, so we make sure we budget the $$ for it every year, by cutting back in some other areas that are not quite as important. Our budget for clothing, food, entertainment, and some other things is fairly low, which frees up some $$ for our winter travel (don't worry, we still eat VERY well........we just cook great meals at home, and dine out only rarely). That is just one example, but I think it illustrates the point. If you have a goal, saving $$ to help meet that goal becomes a challenge......and it's actually very satisfying and rewarding to do things that help work toward that goal, at least for us.

Sounds lovely. Good for you guys.

 

[Wrirya]

I can make more money writing freelance online for an hour than I can couponing for an hour.

I thought you where a real estate guys, who do you write for?

 

[ripper1]

Talk to me about these coupons. I have watched the extreme coupon show and thought it was amazing to get all your food for next to nothing. The problem it seems so impractical to get 50 coupons for something. How do you guys do it? Any tips

My wife gets the majority of her coupons from the daily newspaper. It just takes a little time to find and clip them out. We just buy the stuff on sale that we use or eat. I guess you could find a lot of things for almost nothing but are they useful to you?

 

[arebelspy]

I thought you where a real estate guys, who do you write for?

We're actually teachers. But do a lot of other things, like owning properties, writing, and living. The latter defines us best I think.

 

[Rowdy]

How about the following:

1) Compare life insurance cost through employer vs other life insurance provider. I've found I can do better than my employer's prices. This is of course assuming you are employed!
2) Get rid of 3rd car I did not need.
3) Raise auto insurance deductible to $1,000.
4) Axe cable/SAT TV; get high definition TV for free over-the-air.
5) Stream programming from Hulu to my TV; I'm watching the Daily Show right now through Hulu on my TV.
6) Make full use of flexible spending accounts.
7) Mail order prescriptions.
8) Do own home repairs.
9) Change own car oil, brakes, etc.
10) Drive cars longer (both are over 7 years old).
11) Refi mortgage to 4 1/8 % (that is if you have a mortgage).
12) Cancel land line and use Ooma instead; works great!
13) Shop around for best internet; U-verse is quite competitive.
14) Change filter on furnace/AC.
15) Cut back on watering lawn.

Hope this helps.

 

[Birchwood]

1. Recognize clearly what is need vs. want. If you just want something, wait for 10 days, and if you still want it, consider to buy it.

2. Buy what you need only on sale. Buy stuff off season.

3. Never try to keep up with the "Joneses". Actually avoid these folks.

4. Don't try to buy the best of everything. It cost more money. Settle for what works at the cheapest price.

5. Focus on doing something physical, rather than sitting watching TV or computer. You are likely to buy something from there.

6. Walk or ride the bike for short distances. This is better for your health too.
7. Buy by bulk and use until it's all gone.

8. Pay yourself first. Put money aside before you spend.

 

[TromboneAl]

There are some items you should never buy new because you can get them for pennies on the dollar at a garage sale or rummage sale. Examples: blender mixer pots and pans radio vacuum cleaner toaster oven clothing tools mugs slow cooler luggage printer bicycles stereo food processor more.

 

[ERD50]

There are some items you should never buy new because you can get them for pennies on the dollar at a garage sale or rummage sale. Examples: blender mixer pots and pans radio vacuum cleaner toaster oven clothing tools mugs slow cooler luggage printer bicycles stereo food processor more.

This must be a YMMV thing. When I go to garage sales, I see people getting rid of the same junk I should be getting rid of.

-ERD50

 

[W2R]

This must be a YMMV thing. When I go to garage sales, I see people getting rid of the same junk I should be getting rid of.

Me too, but then garage sales are so much fun. I usually don't see anything but now and then I run into something special. I got the perfect little side table at one for almost nothing a week ago.

I agree about the YMMV, though. It's a lot easier to stumble into something at garage sales (like my table), than it is to find something one is looking for.

I'm surprised that nobody has mentioned MY favorite way of reducing my budget (when necessary, which is isn't right now). That is to ruthlessly cut any recurring expenses, no matter how small. Cut back to the cheapest cell phone contract available, if you have to have one. No newspaper or magazine subscriptions, gym fees, internet website paid memberships, cable TV (if you can bear it, or at least bare bones basic if you can't). And so on. Become debt free so you don't have recurring payments for car or other loans. Go through your recurring expenses one by one and chop, chop, chop. This really helps me to LBYM when I need to do that.

 

[nun]

I've been tracking my spending for a while in preparation for ER. I don't have a mortgage and I'm budgeting $600/month in RE taxes and insurance and $400/month for health insurance. Everything else is $1200/month, so $2200/month wil let me live just like I live now.

I've been looking at ways to economise including, cutting down on beer, eliminating cable etc, but food and the car are my biggest expenses. The money I save not commuting will go to pay my taxes, so that's good, and I think I can go from $400/month on food to $250 when I stop eating at work. I've looked into coupons, but they are all for cr*p that I'd never buy anyway, so I just look for the weekly specials at the market.....last week I picked up some chuck roast for $2.99/lb, froze some and did a pot roast.

 

[nun]

6. ...... ride the bike for short distances. This is better for your health too.

I'm seriously considering going car free as I already do my shopping on my bike.

 

[freebird5825]

Buying food on sale and in bulk packages.
Joining and eating/drinking at Legions and VFWs and private clubs. Cost savings adds up, especially on beverages.
Hanging wet laundry indoors and then only running dryer for touchup.
Using cold or warm wash versus hot cycle for laundry.
Volunteering to get exercise and free meals/beverages/take home extra food as reward.
Buying raffle tickets...so far I won $50 on a football board and a very nice wine basket ($5 ticket). I use all non-winning tickets as tax deductible donations to eligible organizations (503c something or other types).

 

[sirion]

1. Content with a prepaid cell phone for $8 per month
2. No cable TV or fancy internet, just basic landline plus DSL for $55/month
3. Minimal heat and a/c
4. Track every expense and plan for contingencies
5. Stop after one child
6. Exercise and eat well to stay healthy
7. Use free community gym to workout or home videos
8. Hand-me-downs for our child
9. Limit eating out and alcohol consumption
10. Don't buy stuff or get it cheap/used

 

[Mulligan]

1. Content with a prepaid cell phone for $8 per month
2. No cable TV or fancy internet, just basic landline plus DSL for $55/month
3. Minimal heat and a/c
4. Track every expense and plan for contingencies
5. Stop after one child
6. Exercise and eat well to stay healthy
7. Use free community gym to workout or home videos
8. Hand-me-downs for our child
9. Limit eating out and alcohol consumption
10. Don't buy stuff or get it cheap/used

I enjoy looking at ways to cut costs, and I know to each is own, but I sure dont get the freezing in the winter and sweating in the summer to save on costs in your home. If I am going to be poor and not have money to do things, then at minimum, I am going to be warm in the winter and cool in the summer in my house. If I have to walk around naked in my house all summer and wear a parka in my house in the winter, well its time to go back and get a job

 

[NYEXPAT]

Was so impressed by the thread below of budgets and expenses for 2011, I thought I was frugal and now believe I am a fat spender after reading about people that love on 12k per year. That is amazing! So you have all inspired me to clean up and overhaul, however it seems like every time I try and cut back I get stuck. Could you please share the three best thing you have done to cut your expenses?

Thanks in advance for sharing

When I was single I could "love" 2-3x a week on 12k a year, now that I am married it is quite a bit more!

 

[martyb]

If I have to walk around naked in my house all summer and wear a parka in my house in the winter, well its time to go back and get a job

Agree 100%!

 

[martyb]

When I was single I could "love" 2-3x a week on 12k a year, now that I am married it is quite a bit more!

 

[Major Tom]

I'm surprised that nobody has mentioned MY favorite way of reducing my budget (when necessary, which is isn't right now). That is to ruthlessly cut any recurring expenses, no matter how small. Cut back to the cheapest cell phone contract available, if you have to have one. No newspaper or magazine subscriptions, gym fees, internet website paid memberships, cable TV (if you can bear it, or at least bare bones basic if you can't). And so on. Become debt free so you don't have recurring payments for car or other loans. Go through your recurring expenses one by one and chop, chop, chop. This really helps me to LBYM when I need to do that.

Yes, yes, and YES.

This is exactly what I started doing when it occurred to me that if I didn't spend less, I might have to get a job Cutting down on recurring expenses is the gift that keeps on giving. You soon get used to doing with less, or without, but the monthly savings just keep on coming.

 

[Khan]

Me too, but then garage sales are so much fun. I usually don't see anything but now and then I run into something special. I got the perfect little side table at one for almost nothing a week ago.

I agree about the YMMV, though. It's a lot easier to stumble into something at garage sales (like my table), than it is to find something one is looking for.

I'm surprised that nobody has mentioned MY favorite way of reducing my budget (when necessary, which is isn't right now). That is to ruthlessly cut any recurring expenses, no matter how small. Cut back to the cheapest cell phone contract available, if you have to have one. No newspaper or magazine subscriptions, gym fees, internet website paid memberships, cable TV (if you can bear it, or at least bare bones basic if you can't). And so on. Become debt free so you don't have recurring payments for car or other loans. Go through your recurring expenses one by one and chop, chop, chop. This really helps me to LBYM when I need to do that.

What she said.
Also no dryer.
Do most of cooking from scratch, and much from garden.

 

[LauAnn]

I enjoy looking at ways to cut costs, and I know to each is own, but I sure dont get the freezing in the winter and sweating in the summer to save on costs in your home. If I am going to be poor and not have money to do things, then at minimum, I am going to be warm in the winter and cool in the summer in my house. If I have to walk around naked in my house all summer and wear a parka in my house in the winter, well its time to go back and get a job

It's more a case of lowering the thermostat just a few degrees when you are sleeping and using an extra blanket; and putting on a layer beneath a sweatshirt. Agree, that lowering the heat so low as to need a parka is too extreme. As for airconditioning, where I live there are only 2-3 weeks in August that air conditioning would make it easier to sleep. So I tough those weeks out and might turn on a fan if it becomes too extreme.

I agree some cuts proposed are not for everyone and would making 'living' less fun than 'w*rking'. Each of us has different priorities which dictate where we are willing to cutback.