Your Major Expenses Broken Into What Can Be Reduced in Cost What Can?

[KingOfTheCheapos]

Hi,

I've spent the last few weeks looking at what states minimize sales and income taxes (even visited the South). But then I got back and whilst at the grocery store realized I easily spend $10K a year on groceries (we eat at home a lot).

So groceries are by far my major expense (no mortgage to speak of) but I easily would spend $15K it wasn't for:

i) Grocery Outlet and
ii) Winco

No coupon clipping or clever planning just shopping at cheap supermarkets. I'm continually shocked at how the exact same items at Safeway, Raleys etc cost 50% sometimes double. I don't mean just produce (which can vary in quality) but commodity items like the same brand coffee.

The other major expenses I can reduce are:

i) Mobile phone service: (go with pre-paid version of name carrier. For me it's MetroPCS (T-Mobile's prepaid service) I pay 50% less than T-Mobile.
ii) Home repairs. There is always a network of *licensed* tradesman servicing immigrants in most larger towns.

As for major expenses I can NOT reduce within reason:

i) Home and car insurance
ii) Water, Gas and Elec costs
iii) Property tax
iv) Health insurance

 

[pacergal]

Yep--groceries and dining out are the biggest variable line items in our budget and easiest to adjust if needed.
Depends on where I shop, choose to use coupons, what I purchase, etc.
Even trying to move more vegetarian meals over this past year was more spendy than I anticipated--needed lots of new spices, etc that I don't usually use or have on hand for new recipes. But fun to experiment!

 

[KingOfTheCheapos]

Yep--groceries and dining out are the biggest variable line items in our budget and easiest to adjust if needed.
Depends on where I shop, choose to use coupons, what I purchase, etc.
Even trying to move more vegetarian meals over this past year was more spendy than I anticipated--needed lots of new spices, etc that I don't usually use or have on hand for new recipes. But fun to experiment!

I'm curious, are there not inexpensive chains like Winco in your area?

I found that Winco (which has no coupons) is far cheaper and more convenient of course than coupons at other chains. It's not even close, I dropped my bill by 50% once I started shopping at Winco.

 

[pacergal]

I shopped in the past at Winco, Safeway, Fred Meyer/Kroger, Costco, Trader Joes, and sometimes local meat and fish market, occasionally Dollar Tree for cards, paper products, party supplies.
Depends on what I need/want, what coupons are available and what is on sale.
This past year was also more expensive as I shopped primarily Amazon and online with pick up at FM/Kroger mostly due to covid.
Future will be back to usual local stores!

 

[Whisper66]

FWIW - we found we could drop our home and car insurance costs by going out for new quotes from competitors every 3 years. Our property taxes have been lessened by hiring a company to challenge the property values each year. They take half of any tax savings the challenges bring. Electricity is another bill we target. We only sign up for 12 month contract. Each year we evaluate cost of alternative suppliers and typically change suppliers every few years. We also negotiate our internet contract with Xfinity each year and have been able to keep that monthly bill controlled.

 

[sengsational]

I'm not the grocery shopper in the family, but DW shops mostly at WalMart. We have a few regular things we get from Trader Joes, and occasionally, for convenience, hit the Harris Teeter (higher). That being said, we don't try to "save money" on groceries, other than store choice. When it comes to food, I figure we're already doing most of it, just by not going out to a restaurant. That justifies buying whatever groceries we can get excited about cooking and eating.

Utilities is something that I also don't worry too much about. Reasonable water usage, but we have drip irrigation that I don't worry about. With electricity/natural gas I set temperature for comfort, but on the edge a little bit (hotter in summer cooler in winter). I get the cheapest Internet I can. Up until recently, it was a monopoly, but we have choice now. The cheapest is always fast enough for me.

I've never had cable TV. Ever. It's almost all over-the-air, but we have been off and on Netflix, and we will download or stream free stuff. I think cable is a place were people that need to cut can cut significantly.

Phone prices also have a wide spend range. They can be pretty cheap. I'm using Republic Wireless, which is cheap. I've heard people are paying 10X what I pay. Sure, they get "better" service, but my phone does what I need it to do (most of the time, hehehe).

I've requoted insurance, but it was kind of a shell game with auto, home and umbrella prices being cheapest at different outfits, and then if you didn't buy the whole package from one outfit, prices changed. I stayed with Amica.

With home improvement and maintenance, I've always done it myself. That might not be smart, if I listen to Bill Perkins (book author) because that time might be better spent doing something to invest in life experiences instead. But I do get satisfaction out of doing stuff myself, so it's not just for the savings.

Same with yard maintenance. We do it ourselves. DW is the main agent in that realm because she wants it less shaggy than I'd accept it. Again, Perkins might say it's a bad idea, but if one is retired, the yard can be a source of satisfaction.

I like the idea of hiring someone to negotiate the real estate assessment!

Bottom line for me, though, is that, like the OP, not many things I'm in the mode to cut. I've fallen into my basic cheapness ruts, and don't mind going forward in those ruts.

The main discretionary things are travel and dining out. On travel, I'm way under budget there, due to the pandemic. I'm cooking up a deal to get my kids and their SO's, along with DW and I on an adventure together soon (blow the dough style). Need to do it now, while the market hasn't crashed and I feel relatively able to spend the extra.

 

[GravitySucks]

Savings on items marked Essential:

Auto - budgeted for a new car every 5 years but I'm coming up on year 8 and I'll probably keep it 9 or 10 years. So probably a 25% reduction. Could always down grade on next purchase if things get tight.

Utilities - DW (may she RIP) liked the house 74 in the winter, 68 in summer. I heat to 66/68 cool 78/76. More an estimating error than a savings. Changing this to an uncomfortable setting isn't really going to save much.

Insurance - reshop every 3 or 4 years. Might up the deductibles but like the peace of mind. Paying less now than I did when I retired.

Groceries - Always have shopped frugally. Shop a lot at Aldis and Costco. Since beer and wine are in there I could cut back by buying PBR or Genny (which I do sometimes) and boxed wine, but life's too short. I could also entertain less and could eat more beans and rice if I had too. This category is the only one I spent more than expected in the last year. We (DGF and I) ate a lot of steaks and lobsters at home since we didn't go to restaurants. An over all savings though.

Taxes- Forgetaboutit

 

[Koolau]

We buy most everything from Costco now. Groceries - we save 25% to 50% on just about everything vs the grocery stores. Anything (like produce) that goes bad, we can return. It's still expensive at Costco vs, say Aldi's on the mainland. When we visit the mainland, we are always wide-eyed the first time we enter an Aldi's and see milk for less than $2/gallon (sometimes) or blueberries (in season) at $1/box.

But it's kind of nice to know that (within reason) we can just go to "our" Costco and be money ahead on just about everything. We've found a few exceptions and buy those at Sams. No choices on most utilities. Our HOA dues includes cable and internet plus water/hot water, so we have cheap phone plans and try to keep our electric bill under about $80/month. YMMV

 

[audreyh1]

I’m certainly not King or Queen of the Cheapos. When it comes to buying food, I buy the best quality I can.

 

[Car-Guy]

Hi,

I've spent the last few weeks looking at what states minimize sales and income taxes (even visited the South).

"Even visited the South"... Must be desperate...

 

[NW-Bound]

Even without mortgages, my highest category is housing costs. With 2 homes, RE taxes, insurance, and utility bills add up.

Travel and gifts/donations rival for the 2nd spot. Food is not high on the list. We eat a variety of food, and the stuff we like is not always expensive stuff. Lesser cuts of meat can get turned into tasty dishes. Chicken is so inexpensive, and may be healthier than beef.

One time, at a Fry's store, my wife with her keen eyes saw a worker bringing out pork tenderloins marked down to $1 each. Yes, $1 for each loin, not per pound. She asked what was wrong with them, and he said there was nothing. The loins were getting close to the date on the packages, and they wanted to move them.

I could not figure the above out. That was last year during the Covid peak, and amidst the media outcry about pork processing plants having to shut down to protect workers.

Living in the SW close to Mexico also gets us cheap produce, I believe. And the Imperial Valley of CA is also a major produce growing region. Veggies and fruits are so inexpensive here.

So back on living cost reduction, I see nothing that I want to cut out. I am spending way below what I could. If I were getting broke, the 2nd home would have to go. Next would be travel and gift/donation.

 

[Koolau]

Hi,

But then I got back and whilst at the grocery store realized I easily spend $10K a year on groceries (we eat at home a lot).

So groceries are by far my major expense (no mortgage to speak of) but I easily would spend $15K it wasn't for:

i) Grocery Outlet and
ii) Winco

I had to think about this for a minute. I recall the one time I tracked expenses we didn't spend $10K between grocery AND eating out (which we used to do a lot.)

So with trusty calculator, I figured:

At 10K/year for groceries - that's $27/day

At 15K/year (without Winco, etc.) - that's $41/day

I would never tell anyone else how to live, but we could eat out a couple of meals every day for either of these figures. Clearly, it wouldn't be fine dining and we never order soft drinks or bar drinks. So just wondering what you could spend this much on in the way of groceries. Even in Paradise, that would mean buying a fair amount of beef or sea food every day. We don't eat that much of either and our meals are admittedly simple, but I doubt our grocery bill is more than half your 10K/year.

Just curious but what would be your typical "at home" menu since YMMV?

 

[karen1972]

I had to think about this for a minute. I recall the one time I tracked expenses we didn't spend $10K between grocery AND eating out (which we used to do a lot.)

So with trusty calculator, I figured:

At 10K/year for groceries - that's $27/day

Just curious but what would be your typical "at home" menu since YMMV?

Don't know about OP, but we easily spend that but I'd say we eat very gourmet around our house.

Breakfast: Ham/Spinach/Tomato Quiche w/ goat cheese
Lunch: some type of salad dish (think Mediterranean deli style so orange beet salad w/ Arugula and Feta)
Supper: usually I cook whatever we are hungry for and if I'm cooking Paella its going to look like the fancy pic you see when you google the recipe.

For us shopping at Aldis is just to offset and hopefully allow us to still have all our gourmet cheese and coffee, etc. Yes I could get the bananas on sale, but I like blackberries. Yes I could get the 99 cent eggs but I prefer free range. We pay 4x to get real maple syrup, etc. So when every little item you pay up, even if its Aldis it adds up.

We use to spend closer to $2k/month, we are now closer to $850 but that is with a lot of coupon clipping, looking for deals, and way cutting back on "fancy". It was pretty common for my honey to be like I crave duck or ceviche or something else where even if you go buy the uncooked item from the store, you may drop $20 just on ingredients for 1 meal.

 

[Markola]

Super Target has really good prices already, especially for store brand items, and if you get their Red Card (debit or CC) you get 5% off everything in the whole store, plus free shipping from Target.com. If you also scan every item barcode using their Target app, you find all kinds of additional deals.

 

[Marita40]

Property taxes and home insurance, together, constitute my highest annual bill. I'm currently on Cobra, so right now that's a big expense, but it will end in a couple months when I turn 65. Technology costs are low (phone: $18/month; internet: $55/month). No cable TV and, in fact, I haven't had the TV on in about 8 months. Water/heat are reasonable. We use air conditioning only about 2-3 weeks of the year here. I rarely drive, so gas is low and my car insurance rate is also low. I eat well but inexpensively: shop at Aldi or SuperTarget. Everything else is discretionary spending.

 

[pb4uski]

Our five largest budget items are Travel (13.3%), Income Taxes (12.4%), Summer home property taxes (9.6%), Food and groceries (8.0%) and Golf (6.6%)... and are close to 50% of our total budget.

Travel is totally discretionary as is golf. We have little control over property taxes. Income taxes are effectively voluntary since if we didn't do any Roth conversions they would be nil. We could shave back on food and groceries if we needed to... but we don't need to.

ETA: Health insurance (Part B, Medigap and Part D together) is 10.6%.

 

[Aerides]

I figure if you have to look at groceries to reduce your expenses in retirement, you weren't ready to retire.

Sure, I'll bogo and stock up on sale, and source our the best prices on non-perishables, stuff like that. But I know from experience the best fresh meats, seafood, and produce come from a couple of stores which are not the cheapest and buy them anyway.

So I consider my food budget in the same category as utilities.

 

[aaronc879]

$10K/yr on food? Is that for 2 people or is it more? I spend around $2K/yr on food for one person. I don't eat out or order in and that includes food, drinks, and small household items like toilet paper, shampoo and such. I know i'm more frugal than most people on here but there is definitely a lot of room to cut costs if you want to.

 

[Gumby]

I would skimp on virtually anything else before I'd skimp on groceries. The things we could most easily cut back on in a crunch would be restaurant meals, wine and vacations. In a normal year, those three things are >25% of our budget.

 

[W2R]

I figure if you have to look at groceries to reduce your expenses in retirement, you weren't ready to retire.

Sure, I'll bogo and stock up on sale, and source our the best prices on non-perishables, stuff like that. But I know from experience the best fresh meats, seafood, and produce come from a couple of stores which are not the cheapest and buy them anyway.

So I consider my food budget in the same category as utilities.

I agree, but on the other hand I like to plan for all sorts of end-of-the-world scenarios, such as runaway inflation or economic collapse. Even though I regard the chance of such things happening to be ridiculously small, it's just my nature to have a plan so that I know what I would do.

1.) UTILITIES:

In such a scenario, I'd save a lot by not air conditioning even during the summer, or heating during the winter. The climate here is such that you won't die without air conditioning or heating (although you might wish you had! ).

I already use the minimum water, and my phone is $30/mo, so I really couldn't save much there. And internet is a very high priority for me so it's off the table, too.​

2.) FOOD:

I spend a lot on food, so I could cut back on restaurants and buy cheaper groceries.​

3.) OTHER EXPENSES TO ELIMINATE:

I already spend almost nothing on gasoline, clothing, and fitness. I could eliminate video gaming and haircuts.​

4.) SOME OTHER UNTOUCHABLES:

Some other categories that I regard as necessary and would not eliminate if possible, are insurance (health/Medicare, auto, house), property tax, dental, and income tax.​

 

[aaronc879]

Now that I have paid off my mortgage my largest fixed cost is home property tax and insurance which is about $3500/yr. That is at least 1/4 of my total non-discretionary spending. If I don't go South for the Winter I should be able to spend $12-15K/yr all inclusive but I would like to spend $3-10K by snowbirding if I can afford it. I don't spend much so there isn't a lot to cut but there is always something to cut. I could live in my basement during a heat wave to save money on A/C and wear more clothes or wrap in blankets to keep heat down in winter. I could spend even less than the $150/mo on food I typically spend now but at a point it really has a negative impact on quality of life so you have to draw a line somewhere.

 

[daylatedollarshort]

I like bargain shopping for healthy and gourmet food. The prices at Walmart and Costco in our area tend to be below the supermarkets, but shopping at ethnic markets, restaurant supply, the retail store loss leaders, and close out stores can get 50 - 75% off supermarket prices. We eat a lot of stir fries, salads and soups so the exact ingredients don't matter. Like this week Grocery Outlet had a bunch of fancy cheeses like brie for $1.50 a package that would normally cost $8 at Safeway and grapes for $1 a pound that usually cost $3. My goal is to eat healthy for $5 a day per person. On paper I can do that, but then when we get to the store we see other things we like so usually spend more, but it is still a big savings over how we used to shop. Our last shopping trip to GO to stock up the freezer we spent $144 and I think saved $133.

$133 is almost enough to pay for my annual U.C. Berkeley Garden membership ($150), which through all their reciprocal programs gets us and guests into not just the gardens all year but most other museums, gardens and some historical attractions in California and across the U.S. for free.

 

[RobbieB]

Home improvement had been number 1 for the last 2 years. And since we're getting close to the finish line (maybe another 50 grand) that will be decreasing.

But I gotta buy me a boat and a slip to park it in. Good thing the landscaping is ending.

The food expense is going up! My second favorite sushi bar has opened and I dropped the car at the full service place (also now open) and got me a 35 dollar car wash and then a $40 lunch. God it's good to be done with this covid crap!

 

[Sunset]

......
I've spent the last few weeks looking at what states minimize sales and income taxes (even visited the South). But then I got back and whilst at the grocery store realized I easily spend $10K a year on groceries (we eat at home a lot).

So groceries are by far my major expense (no mortgage to speak of) but I easily would spend $15K it wasn't for:

.....

How many folks do you buy for ? $10K - $15K seems pretty high to me.

As a couple for 2017 -> 2020 , each year we spent $4,000 -> $5,598 for groceries + restaurant meals per year.

Surprisingly to me, 2019 at: Groceries: $3,828 and Restaurants: $1,602 and takeout food: $168
Was our highest spend year a total of: $5,598 on food.

Even though in 2020 we spent an extra $1,000 on groceries (Toilet paper ) the restaurant eating fell to zero after the start of the year. So the total went down.

 

[NW-Bound]

What I like about using Quicken is that I can look up anything I am curious to know, regarding personal money matters.

For example, for the past 5 years, what percentage of our total expenses is for food, meaning groceries and the occasional restaurant visits?

Answer: 5.4%.

Without Quicken, I would never know.


PS. What do I do with the knowledge gaining from using Quicken? Nothing much right now, other than to make posts like the above.

Seriously, knowing what we spend on gives me a comfortable fuzzy warm feeling that we are way LBYM, even though we don't need to.