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How I Could Find $13,000 Per Year If I Had To
By JLP | June 9, 2008
NOTE: I messed up. I had originally titled this: “How I Could Find $19,000 Per Year If I Had To.” Well, I made a cut and paste error in excel, which led to my numbers being off by $6,000. The error was caught by a reader and I decided to fix it. Sorry for the mistake. I try to do a better job of proof-reading my posts but sometimes I mess up.
Below is a small list of things that I could cut out of our budget if it became necessary. No, it wouldn’t be fun, but it could be done if I had to. I urge you to create your own list. I think you’ll be surprised just how much you could save if you had to. My list could potentially save nearly $13,000 per year!
Beer - I like beer. I enjoy trying different beers. But, I could give it up if our budget required it. My guess is that I could save $50 per month if I quit buying beer.
Coke - I know, I know. Coke is nasty stuff and I shouldn’t be drinking it. But,… me likes it! I could cut it out of our budget and save $10 - $20 per month.
All other non-essential groceries - These items include things like cereal bars, ice cream, fancy cheeses, and any other items that aren’t essential groceries. I have already cut out ice cream unless it is on sale. I’m just not gonna pay $6+ for a half gallon of ice cream. My best guess is that I could save $400 per month on groceries if I cut out non-essentials.
CDs - I like music and collecting CDs is a hobby of mine. But,… if it came down to it, I could cut out my CD-buying ways and save several hundred dollars a year.
Eating out - Our family spent over $5,700 eating out last year. Obviously we could save lots of money if we buckled down and refused to go out to eat.
Cut out cable and high speed internet - Things would have to be really bad for me to go this far. Why? Because we have a new HDTV and watching regular TV on an HDTV sucks. I’m also on the internet a lot so getting rid of high speed internet would not be good. That said, if I were to get rid of both cable TV and internet, I could save $107 per month.
Ditch my cell phone or landline - My landline costs around $42 per month and my cell phone is around $30 per month. If I ditched the landline, I would most likely have to upgrade my cell plan as it is currrently 250 minutes per month with 1,000 nights and weekends. If I split the difference, I could most likely save another $20 per month.
Those were just a few things I could think of at the time of this writing. What about you? Do you have a suggestion that I could add to the list?
Topics: Budgeting |
June 9th, 2008 at 1:13 pm
I thought this would be something worthwhile. You must make a lot of money because my family and I have already cut out all these things (save for some of the groceries, a few cheeses here and there, etc.) and we’re above the middle income.
I think you should cut out these things NOW while you still have disposable income and SAVE like crazy for the day when you have to cut these out anyway… like when gas hits $10 a gallon
June 9th, 2008 at 1:18 pm
My wife and I decided to grow fragile herbs in our herb garden, you know, like basil. It costs a whole lot to buy in the store because it is so perishable. Well, to make a long story short, basil seems to grow very well in our garden. We cut it, and it grows back twice as fast. We have planted other high-cost herbs as well, and, surprise, surprise, they are doing equally as well. We are hoping our heirloom tomatoes do as well, since they are very expensive at the farmers market. One thing we won’t give up is fresh herbs and fresh vegetables, but we’re getting into growing our own.
All organic, of course.
Yours,
Bozo
June 9th, 2008 at 1:33 pm
If you don’t pay for cable you can still get over-the-air HD, which probably even better in quality, and free.
Interestingly enough, my monthly expenses are about $1,500 for everything (including housing), so I couldn’t even theoretically cut out more than $18,000 :). I’ll soon be moving to a cheaper location, which should drop that to around $1000-1100/month.
June 9th, 2008 at 1:47 pm
EverydayEconomis,
The list was of things I could cut out. I realize that not everyone has the same budget.
June 9th, 2008 at 2:32 pm
I too have a list:
YMCA membership
Entertainment Fund
Internet Phone
The total savings would be $121.00 a month. You have to live life. We enjoy these things now, but know the extra money is there to cut if necessary. Could I cut the YMCA membership and exercise on my own? Yes. Do I enjoy the YMCA and use it - Yes. I choose to put my money there,and I know this is a choice. If we lost our jobs, then I would choose not to put it there.
June 9th, 2008 at 2:58 pm
I could cut out a lot of the things you mentioned. I really enjoy my beer (Stella Artois this week) and it is my friday night ritual to cap off the week by sipping on Irish whiskey or some single malt. Frivolous expense? You bet, but as long as I can afford to do so, it is one of the simple pleasures I would rather not give up.
Otherwise, we could do without 2 Sirius satellite radio subscriptions, could downgrade or possibly eliminate satellite tv, and stop the daily newspaper and some magazine subscriptions. Doesn’t seem like a lot, but those are a lot of little monthly expenses that add up fast.
Probably the single biggest category would be non-essential groceries. We rarely eat out, but that is partially offset by being a food lover and cooking some items that are on the more expensive side. Sure, we could go with a chuck or flat iron steak instead of a NY strip or ribeye, and we probably could eat some frozen fish sticks instead of fresh grouper or tuna, but that just isn’t as tasty. Push comes to shove, it might not be fun to eat only rice, bread, noodles, and cheap meat, but it could certainly save money if need be.
June 9th, 2008 at 3:02 pm
I’ve already optimized my spending, so I’m guessing I’ll be at some risk when I need further cut back.
Beer - I don’t drink. So I’ll pass this one.
Coke - I love coke so much but I found out that, other than water, coke is actually the cheapest alternative drink (though it’s not the healthiest).
All other non-essential groceries - I don’t buy junk food or snacks other than Haagen-dazs that’s on sale.
CDs - I haven’t bought any CDs in years.
Eating out - I limit myself to only one dine out/week. I use Chase Business Rebate Card to get 3% cash rebate.
Cut out cable and high speed internet - I switched from cable to satellite and cable broadband to DSL. That instantly cut the bill in half without losing anything.
Ditch my cell phone or landline - My friend working at a giant telecom company told me that the new generations no longer have landlines. For my cell, I’ve a family plan with shared minutes, it’s more than enough with unlimited nights and weekends (I’m mostly at work during other hours, anyway!).
June 9th, 2008 at 3:11 pm
I don’t think I could give up beer. But I could go to the local CD exchange and by some olders CD’s at less than the original sale price!
June 9th, 2008 at 3:20 pm
My list is pretty much the same as yours except that I will never, ever, EVER go without the internets!! I will subsist on beans before that happens. The mouse will have to be pried from my cold dead fingers. I feel very strongly about it. Also the landline is on its way out. I’m having a hard time getting rid, probably because I’ve always had a landline even with 6 cell phones in the house, but I do believe this will be the last landline month. The cable TV is about to be cut. Did that once before when the kids were younger and watching too much advertising crap. Went without for 3 years and then mysteriously turned it back on ….. anyway it’s about to go on indefinite hiatus again so that people can concentrate on more important things. Like watching pratfalls on YouTube
We’ve cut WAY back on eating out and groceries for health as well as financial reasons. Have also cut back on buying stuff. Both of these categories were killing us.
June 9th, 2008 at 3:56 pm
no beer: $600/year
no coke: $240/year
non essential groceries: $4,800/year
no cd’s: $1,000/year
no eating out: $2,850 ( you still gotta eat )
no cable/internet/phone/cell: $1,524
= $11,014.00
where is the other $7,986 coming from?
June 9th, 2008 at 4:09 pm
SmBizMan,
Dang it! I made a mistake in the Excel spreadsheet, which threw my numbers off. I made the correction. Thanks for the catch.
June 9th, 2008 at 7:48 pm
A cell phone can be very useful for emergencies.
I pay only $27 per YEAR for mine. I got it at 7-Eleven. It’s their SpeakOut Wireless prepaid phones. Unlike other prepaids, a $25 charge lasts an entire year (most prepaids require recharge after 90 days). Calls cost 15 cents a minute, but if you use it just for very important calls or emergencies, it can last a whole year. I only used up about half of my minutes last year.
For the land line, check with your phone company for the basic economy plan. I’m only charged $15/month for mine. It allows 25 total outbound local calls a month. After that, they charge 8 cents a call. I rarely ever go above 25/month.
For long distance, go with prepaid. I use talkloop which charges only 2 cents a minute.
My total phone related monthly costs comes out to under $19.
June 9th, 2008 at 9:45 pm
@JLP
No worries, JLP… I just thought it was really amazing to save 19 grand by just cutting back on those things… so I did the math.
I mean I could pay off my student loans in one year by doing just those things!!
Anyway, it is amazing how much less some of us COULD spend… but choose not to. We should consider ourselves very blessed that we have not had to cut back like this already because of rising energy prices Etc.
Luckily, the difference for me between $35/wk and $42/week in fuel really doesn’t matter.
June 9th, 2008 at 11:46 pm
Movies! My husband goes to the movies about 2x month on average, and it’s probably about $15-20 per time, including concessions. That would save as much as $450/year.
Miscellaneous travel. We live in the middle of nowhere, so going to see anything requires a full tank of gasoline. This was ok when it only cost around $30 or so to fill up, but now that we’re paying $75+, we’ve put a big damper on a lot of our travels. That probably saves us around $200-300/year.
I’m with you on the beer and pop. My husband averages about $30/WEEK on those two things.
June 10th, 2008 at 12:05 am
Do you like CDs, or do you like music? Because if it’s the latter, it would be pretty simple to cut down expenses drastically by buying individual MP3s instead of full CDs. In other words, indulge in your hobby/passion while saving money without crimping your style. Win!
June 10th, 2008 at 12:14 am
Fred,
I like CDs.
June 10th, 2008 at 9:14 am
This is not really a fair contest. There’s plenty I could cut out. Big city income breeds big city expenses, which make it a lot easier to add up potential savings fast. In fact, I already have an emergency budget for just in case I find myself “income constained”. It involves cutting back in ways big and small.
Some simple examples:
Eating out: Avg $250/week = $13,000/yr
- living in the big city and working 60/hrs a week, serving on boards, etc. does not leave much time for cooking. Plus with all the extraordinary restaurants in NYC, its more a form of entertainment (like going to the movies).
Beer & Wine: Avg $400/month = $4,800/yr
- I’ve been gradually moving up the scale, experimenting with more expensive wines. The local wine shop has done a good job of cultivating me as a customer (too good a job it seems).
Car rentals: apprx. $8,000/year
- We don’t own a car, I take public trans to work, but we rent cars a lot during the summer for weekend getaways. Could cut back on half that easily.
Vacation travel: $15K - $20K per year.
- Except for going to visit family, we could cut back most of this. Like everything, our taste has moved up over time. We could get used to traveling in steerage again if we had to.
There’s plenty more we could cut back. Don’t get the wrong idea. We save plenty too. And we always have a contingency plan for cutting back if we need to. We hate fixed expenses, and we don’t ever lock ourselves into long-term contracts or payment plans for anything.
Our biggest fixed expense is our housing, which in NYC is a BIG expense. That one always scares me a bit, but come to think of it, we have rental income to help defray a big part of our housing costs.
I believe in having a plan for just about everything.
June 10th, 2008 at 12:09 pm
Wouldn’t getting rid of high speed Internet impact the income that you earn from advertisements this site? I would think that would be like giving up transportation to your job… something you’d do after you switched to eating white rice and water for a month.
I hear you on the beer budget though.
June 10th, 2008 at 1:14 pm
We started cutting coupons and following the grocery game, http://www.thegrocerygame.com and we have seen between a $40 - $50 decrease a week in our grocery bill. It’s not a ginormous amount, but it helps!
June 10th, 2008 at 9:09 pm
We’re 46 and 47, and we live in Portland, Oregon - where gas prices have been above $4 a gallon for many weeks now. We have very good mass transit here, however, and home gardens are wildly popular, as is bicycling.
We already cancelled the landline ($420 annually), the gym ($408 annually), the daily paper, and have reduced how often we eat out as well as grocery splurges. I hate tracking our finances with Money or Quicken, so signed up for Mint, and I check it weekly to monitor our spending.
But here are some things we’ve always done to save, or recent changes we’ve made:
FOOD:
We now shop at the local Winco (discount grocery store that also offers bulk items) for most staples, with limited organic produce purchases at other stores. We purchase meat in the discount, quick sale section of the grocery stores, which means we can’t be as picky, but we often save 30% right off the top. Then we freeze it immediately.
WORK/COMMUTING:
I am lucky enough to telecommute. I rarely use more than a quarter tank of gas a week and I drive a 4 cylinder Nissan truck, so my mileage is fairly reasonable. Hubby owns his own business, his airline travel is covered by clients, or is tax deductible. My employer pays for our high speed internet.
DRIVING/AUTOS:
We sold the big Ford 250 two years ago - we saw this gas increase coming. We both drive smaller 4 cylinder trucks now.
My husband does all of our oil changes and most of our auto maintenance himself (brake & shock changes, tune ups, belt changes).
We both changed our driving habits! We don’t go above 60 mph now and avoid jack rabbit starts or gunning it at yellow lights. We’ve reduced fuel use by 15-20% doing this alone! That’s an $11 savings per tank for me at $4.20 per gallon.
ELECTRIC/UTILITIES:
We cut our electric bill by 20% each month! Here’s how we did it:
*Unplugging chargers (toothbrush, cellphone) and other small appliances like the microwave when not in use.
*Turning OFF the computer and printer when not in use.
*We changed all of our lightbulbs to compact flourescents
*We changed our hot tub timer to run during offpeak hours (10 pm-6a.m., ours runs for 2 3-hr cycles). We lowered the temp to 101f.
*We do our laundry and run our dishwasher after 10 pm on weeknights, or on Sundays, when power is cheapest here. We use the energy saver button always.
*We turned the hot water heater down to 120 and wrapped it in insulation.
PETS:
We cut down on treats for our 2 dogs to just 1 per day. We trim their nails & wash them here at home instead of at a groomer or dogwash.
HOME/MISC:
We repair our items as much as possible rather than replace them. For instance, we have good shoes resoled and we polish our leather items ourselves; we purchased a second hand sewing machine for minor clothing repairs; we tune up our lawnmower ourselves; husband reglazed our windows himself. We also do most of our own home maintenance (we built our own fence and clean/seal our own deck) and all of our own yardwork.
GARDENING:
In the summer we grow our own tomatos, herbs, and some veggies like snow peas, squash and beans, etc. I make and preserve our own jams, and also can fruits (I purchase from a local farmer in bulk) and our homegrown tomatoes. Not necessarily cheaper, but much tastier and a lot of fun. We purchased 3 rainbarrels (end of season sale) and catch the water from our downspouts, and use it for as much gardening as we can.
In the shower, I catch the cold water that runs (while waiting for the hot water to arrive) in a big bucket, and dump it into a rainbarrel for garden use. Or I water my plants with it. I do the same at the kitchen sink in glass bottles - for the dog dishes, the house plants, etc. Our water bill is 1/3rd less than our comparable neighbors because of our conservation efforts. They’re now doing the same.
MEDS:
I am on two medications (chronic problem but well managed) - using a mail in pharmacy saves me 40% cost! That’s a savings of $40 per month!
Doing these things has enabled us, even during these tight times, to save 18% of our income for retirement and have a 6 month emergency fund
We just purchased a small 1000 sq foot home on 4 acres. Because we settled for less house, more land - the payment is only $100 a month more than we pay here in Portland (it’s just the two of us, 1000 sf is plenty, folks!). We’ll be moving there soon, then we’ll be renting out our current house for a $120 monthly positive cash flow.
No, we’re not flush, but we’re fairly thrifty, and I have to admit we’re not feeling the pinch of this economy all too much. When we hit $8 a gallon, then I’m sure we’ll feel the pain too!
Sorry so long! Love reading everyone’s ideas and efforts. Good luck to all! :o)
June 11th, 2008 at 2:28 pm
I wish I could stick to a regiment like this. There is no way that I could be able to do this. I love my luxury items way too much.
June 11th, 2008 at 10:15 pm
Now buying cheaper Pinot Grigio–goodbye Santa Margherita, hello Cavit!