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5 Simple Ways to Cut Your Monthly Expenses

Monthly billsBy Benjamin Feldman

At the beginning of this year, I decided to pay off my credit card and stick to a serious monthly budget. I was excited to pursue this goal, but I was also nervous. After all, we all want to spend less money, right? But the problem is that finding new ways to save money is usually much harder than finding ways to spend money.

For example, you might decide to pass up a Starbucks latte on your way to work in the morning and then later that evening you indulge in a nice meal at your favorite restaurant. Which can easily make it feel like your efforts to live frugally are not amounting to much. However, I've found that the most effective way to cut your spending is to focus on those things that you pay for each month.

If you can reduce the cost of your monthly fixed expenses, you will find your budgeting is much more successful and you'll have less stress about saving money. With that in mind, here are 5 simple ways to cut your monthly expenses:

1. Reduce your food bill

Easier said than done, right? Well, yes. But the "food" category is often the one with the most potential for reduction. When I finally took a hard look at my own budget, I realized one of the places where money was leaking out was in my spending on food. I was eating out everyday at lunch because I never took the time to make lunch at home. At the same time, I was having dinner at restaurants almost every weekend, and I was not closely monitoring how much I paid for groceries.

Once you closely track your own spending, you might find that you are in a similar situation - if so, here's what to do. First, come up with 3-4 easy lunches you can make at home and plan for how you'll add time to your daily or weekly routine to prepare these lunches. Some people prefer to do cooking on Sunday and put enough veggies, meat, fruit, etc. into tupperware to last all week. Others like using leftovers from dinner each night to create lunch for the following day. Whatever you prefer, make it your habit and make sure you add enough ingredients to your shopping list to account for this increased cooking.

At the same time, find tricks to make weekend cooking more enjoyable. Whether it's listening to the radio or doing some "team cooking" with your significant other, focus on having fun with the entire process of making a meal (rather than feeling the urge to visit a restaurant). You might find you have more fun with a leisurely meal at home than at a restaurant anyway!

2. Cut the car payment

One of the major components of your monthly budget may be your car payment. And there's not necessarily anything wrong with that – however, if you are working on cutting expenses (in pursuit of a goal such as: getting out of debt, buying a house, early retirement, etc.) then the car payment might be excessive.

Consider this: if you have $3,000 to $5,000 saved up, or if you can get out of your current auto loan or lease and sell your vehicle for around that much, then you can get a functional car that you can rely on to get you where you need to go, with no monthly payments. Now, you won't be riding in luxury, and it may take some getting used to. But if you can find an older model car like a Toyota or Honda that tend to be quite durable and reliable, the reward is a big-time savings in your monthly cashflow. Depending on what your current car payment is, you could save up to $400 per month!

3. Take advantage of free entertainment

Do you know how much you pay for all your entertainment in one whole month? Adding up your spending on cable TV, Internet, movie subscriptions like Netflix, concerts or sporting events you attend, happy hours with friends, etc., you may see that your entertainment spending is hundreds of dollars per month.

I won't tell you to cut off your Internet access, but beyond that, think about how much of this entertainment spending you really need. A Netflix account and premium cable channels may be redundant. Do a quick audit of your costs and decide what you can cut. More importantly, make a commitment to focus on free ways to have fun - such as picnics in the park or local events that are open to the public like summer concerts sponsored by the city. I've often been surprised at how satisfying free entertainment like hosting a board game night with friends can be compared to more costly activities.

4. Don't pay (much) for a gym membership

It's always good to exercise, but these days a lot of gyms cost a hundred dollars per month or more. The reality is, for most people, effective exercise can be done at home with light weights and resistance bands. If you're someone who appreciates exercising in the gym, you can still do it in a frugal way if you find a good deal. There are lots of gyms that advertise discounts online, and one prominent nationwide gym has a very cheap discount available for anyone who shops at Costco (or who has a friend that does). With one of these options, you can still get your workout while reducing your monthly expenses.

5. Remember that fashion is fleeting, but clothes are not

How much do you spend on clothes per month? One quick way to find out is to tally up all your clothing purchases over the last 6 months and then divide the total amount by six. That average will tell you what to expect on a monthly basis. Then think long and hard about whether you really need any new clothes. It's one thing to replace a pair of worn-out jeans that you've worn for years. But it's another thing to buy a new pair of jeans every couple of months. Remember, you're not going to save money unless you focus your spending on things you need, not just things you want.

Hopefully these ideas will help you get on your way to reducing your monthly expenses. You can also check out ReadyforZero's Credit Card Debt and Student Loans resource centers for advice on getting out of debt. I know it's hard because I've spent 2012 trying to follow this same prescription, but I also know that when you start making progress and feeling more confident about your financial position, it's totally worth it.

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Eli Brown

A lot of hilarious comments on this thread! :)
On a more serious note, I agree with most of the article.
Regarding entertainment expense, I would recommend using a bill negotiation service to negotiate discounts on your behalf. I have used a few times in the past and they were able to get me some amazing discounts without modifying my service.
When it comes to the food bill, I think way too many people eat outside everyday. In my opinion, this si an extremely expensive lifestyle...and a very unhealthy one too!

May 22 2015 at 3:49 PM Report abuse rate up rate down Reply
Thomas Rockford

Another point, $10 a month for one utility, another $ to cut extra cell phone service you don't use. Get $30/month auto insurance from 4autoinsurancequote. Cut your heating/AC by one degree, now you are over $50 a month. It is amazing how these small leaks sink big ships.

February 07 2014 at 1:56 PM Report abuse rate up rate down Reply

Are you in the habit of investing your costs late? If so, you're probably investing extra for the advantage. Start investing your costs quickly, and say goodbye to delayed expenses and amount outside outdoor hikes once and for all. Running a household is an expensive affair, but there are lots of things that you can do to minimize the cost.

November 01 2012 at 7:06 AM Report abuse rate up rate down Reply

How do you spread 1,382.00 over a month??????????????with car payment.electric bill, prescriptions, doctors co pays, internetw/phone/,gasoline,groceries with an added 17.00 a month for food stamps,personal items,cat liter, and cat food from the dollar general store. I'm a senior citizen, please tell me what you would do. Thank You.

October 28 2012 at 1:47 AM Report abuse +1 rate up rate down Reply

Doing without has been a way of life for us. When we were children and ran out of milk, eggs, butter or whatever we did without till payday. There was no borrowing from the neighbors allowed. At this point in our life, we are sick and tired of doing without, especially when we see how much of our money the President and BOTH Parties - (Democrat
& Republican) of the Congress Spend Like Water.!! Hundreds of BILLIONS for people and countries who not only Hate us and want us DEAD, but who have KILLED OUR PEOPLE ! Now our Government has taken to watching our people being killed in "Real Time" & Will Not Send Them HELP. When is it going to be the "Middle Class Americans" TURN??

October 27 2012 at 7:12 PM Report abuse +1 rate up rate down Reply
Ta ma'ra Elliott

My Dad used to say- money is a mistress most men can't handle. hahahahah
Make saving a game- we used to have who could eat the cheapest lunch?
Say "NO" once in a while to the kids- it's good for you and them.
Stop blaming everyone but yourself. Good luck! ( we all need it)

October 24 2012 at 7:36 PM Report abuse rate up rate down Reply

I'm a pro at this. I was left the house and a large monthly nut by the ex so i would loose everything. instead i took the bull by the horns and made it work. the day she left i canceled cable, lowered my Internet, got rid of the land line, respected the thermostat, I shop at savings outlets. i have NO car payment i gave my ex the loan before she blew up her credit, i kept the classic car, i am entertained by netflix for 8.54 a month, I didn't date it wasn't important (Good LOOKING Mid 40's yes ladies I'm available now a great catch) I modified my mortgage and own a 4br 2ba for less than renting an efficiency (2% interest rate). Yes i do work a full time Lower middle class job i get nothing from the government in the way of public assistance. it took a couple of years but i got it done right. its just a matter of not crying and get the job done Be RESPONSIBLE . my focus is my child my job and keeping a roof over our heads cutting bills has nothing to do with the government it starts with you

October 24 2012 at 5:13 PM Report abuse +3 rate up rate down Reply

1) get a government housing voucher. 2) get food stamps. 3) send your 10 kids to a public school. 4) get aid for dependent children and earned income credit on your taxes, if you pay any. 5) get a free Obama phone.

October 24 2012 at 3:33 PM Report abuse -8 rate up rate down Reply
Shad Velasco

Does anyone really think that the government will cut spending? They all eat out every night, drive fancy cars and that will never change. Romney? Is anyone concerned that he says what everyone wants to hear every week. The president of the united states is not responsibe for the irresponsible action of the people of this country. Spend what you can afford and save when you can, and everyone will be ok. I love all the reasons why not to eat out. And less tipping? Obviously you have never been a waiter. How about we stop being cheap all the time. If you cant afford to tip then dont go out. Thats their income. You drve a $50,000 car and complain about tipping someone $20? If you cant afford internet than you are spending too much elsewhere. Stop spending money you dont have. When the economy got bad I got another job. Step up America. Its time to be responsible.

October 24 2012 at 2:35 PM Report abuse +1 rate up rate down Reply

Old cars mean repairs.
If you are a couple or live alone, it is more expensive to make food and then throw out much of it.
If you eat out, eat out for breakfast, it is cheaper.
If you want restaurant food, do take out, with no tip.
Volunteer so you have less free time to go shopping.
Watch reruns on free stations.
Do household projects to avoid boredom. Boredom leads to expensive habits.
Can't afford to fly away on vacation. Drive to Canada for a change, if you live up North. If you live in Florida, drive to Key West. Both offer exotic changes.
Yake the children to the library for activities.
Don't use coupons. It is a trap to change your spending habits. If you don't need to buy in bulk, don't. You will never use it and waste money.
Do look for store specials on items you do use.
Working overtime might put you in a higher tax bracket and you might lose daycare subsidy, if you have one.
If you are unemployed, tell everyone. Someone might know of a job.
Don't listen to commercials. Put on mute. They are trying to sell you something.
If necessary, move to a state where cost of living is less.

October 24 2012 at 12:26 PM Report abuse +1 rate up rate down Reply