Changing Middle Class Perspectives

When I started writing this blog, I started it for one reason. I hadn’t yet found a good resource for our family type. I even went so far as to list our annual budgeted expenses and lament that there was not a lot of wiggle room for us to lower them. Over the last six months, through reading personal finance blogs, educating myself by reading books like The Millionaire Next Door, The Wealthy Barber, Rich Dad Poor Dad, Your Money Or Your Life, and Nice Girls Don’t Get Rich, and plain old fashioned common sense, we’ve really worked to lower those expenses.

Our income is significantly less than it was when I started writing here. Mark started his own consulting company, and working for yourself rarely pays off in the first year or two. It’s been an interesting (and by that, I mean frustrating and stressful) experience, finding out just how little we can live on when we have to.

Just for giggles, let’s take a look at the modifications to our annual budget from 6 months ago, and how it’s changed:
Annual expenditures
$27,624 14,424 – Child support (YL18 and YL19 are off to college now – Lowered by $13,200)
$13,044 – Mortgage (NC)
$9,400 8844 – All utilities & telephone expenses (Lowered by $556)
$9,100 5200 – Groceries and household (Lowered by $3,900)
$9,000 – Back Taxes (NC)
$6,500 – Health Insurance (NC)
$6,000 – My 401K (Maxed at 15% of my income) (NC)
$5,000 – Travel expenses to visit YM 10 (he lives 4 hours away and we see him every other weekend) (NC)
$5,000 – Gas (auto) (NC – We’re just driving less.)
$3,900 1300 – Mark’s discretionary budget (Weekly amount now $25 – Lowered By $2600)
$2,600 1300 – My discretionary budget (Weekly amount now $25 – Lowered By $1300)
$2,050 2200 – Auto Insurance (Raised by $150)
$2,500 – Auto Repair and Home Repair (NC)
$2,000 – Clothing (NC)
$1,500 750 – Dry Cleaning (work clothing and ROTC uniform) (Lowered by $750)
$1,416 – Student Loan (NC)
$1,000 – Medical co-pays and prescriptions (NC)
$876 – Gym Membership (NC – But only because we have a 2 year contract. UGH)

Overall, we’ve lowered our annual budgeted expenses by $8956 by conscious effort. Our total budgeted has lowered by $22,156. I guess that working hard and lowering our expenses by almost $9000 over the last 6 months is a pretty good track record. However, we’d never have done it if our income hadn’t taken a hit. So, how did we do it?

Utilities:

• Lowered cell phone plans on all phones. If you have rollover minutes every month, you are paying too much.
• Replaced light bulbs with CFLs
• Use attic fan more
• Hang clothes out to dry instead of using dryer for all loads
• Cook outside on the grill as often as possible to keep from heating the house

Groceries and Household:

• Developed a Coupon Management System and use it religiously
• Using The Grocery Game and best deals blogs like Be Centsable and Money Saving Mom
• Stock up at the best price so I don’t have to buy anything at full price.
• Growing our own tomatoes, lettuce, peppers, basil, chives, and a few other herbs in our Square Foot Gardens

Discretionary Spending:

• This was the easy one. If there’s no money sitting there to tempt you, you don’t spend it.
• Stopped eating out at lunch and started bringing lunches from home
• Stocked desk with healthy snacks to keep me from using the vending machines
• Started asking ourselves “Is this what you really want to spend your $25 a week on?”

Dry Cleaning:

• Looked at ALL of the laundering labels and pulled out all items that were machine washable
• Stopped dry cleaning all of Mark’s work clothes just to keep from having to do the ironing
• Stopped wearing dry-clean-only clothing, unless it was necessary

What about the rest of you folks that are trying to be more frugal? Have you had a drop in income? Lost a job? Trying to keep your budget from exploding with rising fuel and food prices? Share your tips here. We can definitely use them!

Don’t miss an entry… get your free updates online, or get them emailed directly to your inbox.

Be Sociable, Share!

•