Previously I talked about gathering all your financial info so you know where you are starting. I call this digging your head out of the sand. š
When I started digging my head out of the sand the first thing I did was wrote down everything we spend money on in a typical month, and everything we owed. Ouch, not a fun number to look at.
Next, I started reading about budgeting, and trying to get a handle on our budget. The first month I cut some easy expenses, and over the last 4 months I have diligently gone through every expense and figured out any way I could possibly cut it or get rid of it completely.
Hereās a breakdown of what we are projected to save this year based on all our spending cuts.
Expenses cut:
Mortgage Savings:
Refi Savings $4200/year
Insurance Savings:
Auto: $672/year (read how we saved on auto insurance)
Life: $60/year (by setting up automatic BillPay monthly)
Utility Savings:
Gas/Electric: $360/yr (using power strips and being more energy conscious)*
Water: $60/year (running the water less, fixing drips)
Cable internet and phone package:
Cut cable : $921/year (read How We Cut The Cable Bill)
Groceries
Shopping with a list: $2400-$3600/year (letās average that and say $3000)
Iāve also been stocking up on items we use frequently when they are on sale, as well as eating more seasonally to avoid expensive out of season foods.
Learn more: How To Stock The Pantry
Fees
finance charges and late or overdraft fees (saved by automating and creating a cushion in our main accounts) $3600/year
Other expenses cut:
cancel gym membership $1080/year
packing lunches $1000/year
cut back on eating out $2400/year
Total Savings: $17,593!
*=we put 2 areas on power strips, make a conscious effort to turn off lights, unplug power cords, and unplug our small kitchen appliances.
These are not all of our expenses, as some were unable to be changed. This should prove to anyone who is disbelieving that small and big changes can be combined for a big win.
The savings we had is fairly high, and the majority of that savings is going towards living beneath our means, and paying down existing debts.
It took approximately 10 hours of work. Well worth it!
Have you cut expenses? If so, where? And more importantly why?
Kelly
wow, that is a lot o fmoney saved. has me inspired to see what we can do with our household budget.
Liz says
We did cut expenses this year. I just renegotiated our insurance rates without switching companies. That saved $500 on our home insurance over what I was billed for our renewal, and about $400 on our auto rates annually. Great savings!
I also started keeping a monthly budget, and it has absolutely helped with making us more concious about what we are spending for things that we donāt NEED right now.
I paid early for summer camp, getting a $10 discount per week (so thatās $120 over the camp duration) and paid a $60 camp membership fee that will save me another $30 per week over the non-member rates ($10 on the weekly rate and $20 for after-care). Of course, I had to put down a hefty deposit of over $550, but thatās where that savings account comes in handy.
Eating healthy has a side benefit - savings from packing lunches! By not spending $3-$6 per day on lunch here at work 3-4 times per week, Iām saving about $800 per year. And Iām just eating more of the groceries I already buy (so less goes to waste). In fact, I spend LESS on groceries now that I did last year, thanks to cutting out so much expensive processed/prepackaged foods.
Kelly says
Liz, those are great examples of ways to save! I wonder how much it would add up to if you calculated all the savings you have found?
I love that you saved so much by registering early for summer camp, thatās a great tip!
Liz says
We did cut expenses this year. I just renegotiated our insurance rates without switching companies. That saved $500 on our home insurance over what I was billed for our renewal, and about $400 on our auto rates annually. Great savings!
I also started keeping a monthly budget, and it has absolutely helped with making us more concious about what we are spending for things that we donāt NEED right now.
I paid early for summer camp, getting a $10 discount per week (so thatās $120 over the camp duration) and paid a $60 camp membership fee that will save me another $30 per week over the non-member rates ($10 on the weekly rate and $20 for after-care). Of course, I had to put down a hefty deposit of over $550, but thatās where that savings account comes in handy.
Eating healthy has a side benefit - savings from packing lunches! By not spending $3-$6 per day on lunch here at work 3-4 times per week, Iām saving about $800 per year. And Iām just eating more of the groceries I already buy (so less goes to waste). In fact, I spend LESS on groceries now that I did last year, thanks to cutting out so much expensive processed/prepackaged foods.
Kelly says
Liz, those are great examples of ways to save! I wonder how much it would add up to if you calculated all the savings you have found?
I love that you saved so much by registering early for summer camp, thatās a great tip!