Friday, April 20, 2012

Healthy Finances: Where You Can Cut

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Over the past 6 months, my husband and I racked up quite the credit card debt due to buying our house. We put down a nice chunk of money in cash but the moving expenses is what pushed us over: uhaul, deposits on utilities, initial repairs, and even Mike's truck needed some work done.

Photo Credit Stuart Miles
We prided ourselves on being credit card debt free but somehow, once the ball got rolling, it was hard to stop.  We bought Dave Ramsey's books for Christmas and just finally got to reading them. We heard a lot of amazing stories about the success of his program (even my Dad, who isn't even in debt, loves his stuff), so we decided, what the heck. Clearly what we're doing wasn't working.

Luckily, we already had $1,000 saved up in an emergency account (which is one of Dave's first steps and can be one of the most difficult to accomplish for many).  This month, we looked at our monthly expenses and figured out what needed to go. We really don't have a lot of "luxury" expenses. By luxury I mean home phone, cable, newspaper delivered, and so on. (If these are things you use, feel free to cut them right now! They're not essential for living, and a good book never hurt anyone.) The only "luxury" item we are keeping is our internet, solely for the fact that since we're out of the loop every other way (no cable, no newspaper) it helps us keep in touch with reality. Plus our internet bill is pretty cheap.

It was very difficult to decide what to weed out, but we finally figured out a few things.  Here is our list of what we cut from our monthly expenses, starting last month, to allow us to double up on student loan payments and credit card bills.

Photo Credit Stuart Miles
1. Cell Phone Downgrade- Since we don't have a home phone, we must have cell phones. We did have Verizon and it was costing us a hefty $170 a month for 2 phones. We got rid of those and picked up Virgin Mobile. It's still unlimited texting, unlimited data, and 300 minutes for each phone but the monthly bill is only $35 per phone. That's $70/month. If you have a home phone AND cell phone, chose one. Savings per month: $100
2. Garbage Pickup- I've had a few friends look at us like we were crazy when we told them we're getting rid of this, but garbage pickup (not including recycling) was $53. It would have been an additional $50 for recycling so we opted out when first moved here. We found out that there's a drop off point just a couple miles down the road where you can dump your trash...for FREE. And they take separate recycling...for FREE. Since we started our compost pile last week and pulled out a bin for recycling, the amount of trash we have is greatly diminishing, which means we can drop off our bags of trash and bin of recycling every 2 weeks. Many take for granted garbage and recycling pickup, and like I said, I've had a few crazed looks when I said we'd be dropping off our own trash, but to save the $53 and put it towards other bills is so helpful. Savings per month: $53
3. Netflix- I know, it's $8 a month, and we don't even have fancy cable service, but that's $8 of gas, or $8 in groceries (I can get a few heads of lettuce for that). Yes, I'll miss my nights of Star Trek & X-Files marathons, but I'll suck it up. Plus, I have so many books that need to be picked up. Savings per month: $8
4. Gym Membership- I was super excited when I joined the YMCA three months ago. It gave me a chance to meet some people and to get out of the house for working out. But, it's $40 a month, and there are plenty of things I can do at home (look out for more workout posts when this month's membership runs out!) I'll be getting more creative with my workouts. To be honest, I'll miss the hell out of my spin class. That thing just can't be replaced. Savings per month: $40
5. Phone Insurance- The phone I bought from Virgin Mobile is a beast. I've dropped this thing so many times and I don't have as much as a scratch on the thing. So, knowing it's durability and the fact that we were spending $7 a month on insurance, we dropped it. Savings per month: $7
6. Groceries- Before we started eating well last year, were were spending anywhere from $160-$200 a week on food (groooosss, right?). And that's why were were fat. Once we switched our diet, we cut back to $100/week. Then we tried to shed down to $90. Now that we shop at Trader Joe's & the farmer's market, last week was our first time on the $70/week budget. I spent $64.29. It's hard, and I had to put a couple things back on the shelf that we didn't NEED (Mike wanted Ranch dressing, but we had a dressing in the fridge for salads, so I put it back. I love blueberries, but for a tiny little thing they're over $3, so I put it back and bought a bag of Tangelos for almost the same price.) Make a menu plan for the week and STICK TO IT. Don't buy extra. Stick to what you need for the week and I promise you'll cut down your grocery bill significantly. Savings per month: $90
7. Restaurants: Going out for a meal is not an option. Not even once a month. I know people who SWEAR by this, and state "we HAVE to have our date". I promise, there are other things you can do. Trail hikes, free festivals, movie night with a special planned out homemade dinner. Honestly, Mike and I would eat out for dinner about once a month, but still, for the two of us for a nice meal out, it costs about $50. Savings per month: $50

Let's do the math on how much we're saving a month: 
100+53+8+40+7+90+50= $348!!
Photo Credit Grant Cochrane
There's a quote by Dave Ramsey that sums up his program, "Live like no one else, so that later, you can live like no one else."  We've cut some things that people wouldn't dare think about getting rid of. We're going to have to stop buying presents for some people. We'll be saying "no" to a lot of things friends and family might want to do (we already had to say no to this summer's family vacation). We're going to live like no one else right now. But the goal is that down the line, we've gotten out of debt, spent wisely, and saved up money so we can live like no one else (enjoy a vacation without guilt, buy a nice dinner without worry, confidently save up for our future children's college, know that retirement won't be a struggle financially but rather something to look forward to).

I wish you the best of luck, and please give us suggestions for other things we might be able to cut out of our monthly expenses! We're always looking for ways to save.


  1. Super, super, super proud of the two of you. Stick with it and know you have my support!

    I know for myself I call every 6months to a year everyone that I have a bill with to see if it can be lowered in some fashion.

    Don't forget to see if you can get any of your insurances lowered. And see if you can get your credit card debt transferred to the one that has the lowest percentage rate while you're paying them off.


  2. Adam's family went through Financial Peace University several years ago, and since starting college Adam has been a HUGE Dave Ramsey Fan. I'm working on reading Total Money Makeover right now. Lots of great stuff! I'm so proud of you guys for prioritizing all of those things! Will be worth it & you can do it!!!

  3. Wow, go you! That's awesome! I've definitely been trying to cut down on my grocery bills. Last weekend I went shopping, and crossed off some things on the list that I really didn't need. I cut my bill down from $90 to $46! A lot of times I feel like I "have nothing to eat", but the truth is, I do. I just need to get creative sometimes ;)

    So proud of you :) It takes a lot of discipline to say no to luxury things that you want.