Rubber Meets the Road
You’re firmly dedicated and have a budget to work from, so your foundation is firmly in place. Now its time to make things happen and cut expenses…
For the ‘savers’ among us, this money principle is an easy one because it comes naturally for ‘savers’ to live frugal. For the ‘spenders’ this principle will be a challenge, as you will have to make extra effort to cut your expenses and live within a strict budget. You will be drawn to every opportunity to part with some cash. (believe me – I’ve been there) Be aware of the little expenses… five dollars here, ten dollars there… these are the purchases that add up throughout the month and turn into hundreds of dollars and totally ‘body slam’ your ability to live by a monthly budget.
The point of this principle is ‘simple’ that almost anyone can understand it. So what I want to do in this article is to be very practical and give you five simple steps you can quickly take to cut costs and lower your expenses.
You’re not going to be looking for your socks, many of these steps you probably already thought of and just haven’t taken any action on – so hopefully I can encourage you to at least pick 3 of these simple steps and begin cutting…
Step 1: Dump your vehicle
I remember when I first started cutting my expenses. I was driving a beautiful gas guzzler that got 15 miles to the gallon (93 Octane no less) and was costing me hundreds of dollars per month in financing payments. I knew I had to get rid of it… problem was I loved everything about it – from the exterior to the interior, to the way it handled in the snow. For sure, I was totally taken with my shiny SUV and it took considerable time to cut the cord, but I finally pulled the trigger and sold it after 6 months of debating.
Boy am I thankful I did! By just dumping my high priced gas guzzler, I quickly saved $200 per month in monthly payments and at least $100 a month in gas costs. Now that I am driving my new vehicle, I could never be happier for adding $300 to my bottom line. (Think of what you could spend $3600 a year on!)
You may or may not be the same situation, but if you are – just do it! Dump that vehicle and save some cold hard cash.
Step 2: Drop your home phone line
This one is the ‘no brainer’ of the bunch. If you have a cell phone – and I’m betting you do – why are you paying for a home phone line at $30-$40 per month, plus long distance charges? Cell phones work just fine and can handle any phone call you need to make.
I’ll admit, if you have a home phone today, the thought of getting rid of it is an odd proposition. You probably have become attached to that home phone and answering machine – I know I was. But I assure you that once you cut this expense you will never even think about it again. Normal life will change to your cell phone and you will not go back to adding a home phone again…ever!
Step 3: Learn to cook & eat at home
As American’s we love food. We even love the event of eating out more than food. Its the culture of who we are and in many cases is what we look forward to in order to wind down, relax, and enjoy the company of friends and family.
Because of this, embracing step 3 will be tough – but will really help you cut your expenses. For this one, I don’t recommend a complete elimination like I would suggest for the home phone line and something like cable. Instead I recommend you set a limit on the number of meals you eat out per week/month. Just eliminating one meal per week of eating out can easily save you $200 per month, so the bang for your buck is huge.
Step 4: Bring your lunch to work
This step is one of my favorites. Its simple, easy, and you see the savings quickly. Problem is that it will take some discipline to not buy your lunch everyday – if that’s what you’re doing today. This is usually because lunch breaks provide for that momentary relaxing time from a stressful day at the office – or wherever you work – and removing this luxury of purchasing lunch also removes the link to that relaxing hour you enjoy.
In regards to saving cash, it has a lot of bite. Even if you saved on the low end of the cost of eating lunch, say $5 per day – you can be easily looking at $80-$100 per month. This in itself doesn’t sound like a massive amount for the stress relief you love, but when adding it with other expense eliminators – it is worth experimenting with.
For me, this step was hard until I replaced my lunch with working out at the gym. In the past I used my lunch as a stress relief by leaving the office and buying a nice lunch. I easily spent an additional $100 a month on lunch food while at work. Now, I bring my lunch everyday and spend my lunch break swimming and working out. This small change has not only saved me a bunch of cash – but has provided the stress relief I needed and has helped me drop a few pounds, which is always a plus.
Step 5: Walk/Bike when running errands
I’ve only just started implementing this one and really love it. If you have kids your probably thinking I’m crazy, but I have 2 kids as well and decided to purchase a bike trailer in order to make this one work.
Now, whenever I need to make a trip to the food store, or stop at the post office, or just hit the park for my kids to play – I take the bike. It is a great way to save money on gas and provides a new avenue for enjoyment. I estimate that I save about $2-3 a day on gas by using my bike, which adds up to a cool $90 a month. Not bad for cheap entertainment.
The Grand Total?
So how much did these steps save me? … A cool $700 a month! Implementing all 5 won’t be easy, so I recommend picking at least 3 to make your life easier. If you can do all 5 – Great! You may save more than me, depending on your situation.
One thing is for certain if you implement any of these.. You will have a lot less ‘money’ anxiety, and feel much more in control of your personal budget. Make it so!