In order to cut back on spending, it helps to understand just what your money is being spent on. So, the first question is, ‘What do you spend money on?’ If you have a budget it will be a bit easier to answer this question, but if you don’t than you may need to do some research.
Here is an idea. Get a piece of paper and write down everything that you can think of that you spent money on this month. Then, read the list to everyone in your family and ask if you forgot anything – adding the new items to the list. Don’t forget the bills - add them to the list too. There, now you have a pretty good idea of where your money is going each month.
The second question is, ‘What is absolutely necessary?’ The big items are usually easy to find, like the mortgage, car payments and credit card payments. Cross out all the items that are absolutely necessary. Then, start looking at the items that are almost necessary, like dog food, groceries, paper tissue products, batteries, etc and cross them out. Then, look for things that you could live without, like, kid’s summer camp, new clothes or cable TV. Circle those items that you think your family could live without. Ok, now your family members may not agree with everything that you circled, so get them all together to discuss what items they agree to cut out. If they all fuss about the items that effect them the most, then you may have to ask everyone to share the burden by having each person cut something that they like.
The service sector of the economy has been expanding for years. As the net worth of our nation rose, so did our appetite to outsource the things around the home that we didn’t want to do. Services are going to be one of the first places to look for things to cut, although cutting back on them will put the work bad on you. Here is a list of services to look at:
- House cleaning / carpet cleaning
- Lawn care / snow removal
- Eating out / delivered food
- Hair cuts
- Washing your car / changing your car’s oil
- Entertainment / movies / cell phones
The good news is that cutting back will perhaps give us all more time with our family – doing the things that we love, like the dishes.
If you find yourself cutting back on things, I'd love to hear how you did it just leave a comment at the bottom of this article.