How To Cut Your Budget When You Think You Can’t

It’s no secret we all need a budget. You can make $10.00 or $100.00 an hour or more. It really doesn’t matter, everyone needs to make a budget based on the amount of income you have coming offset by your expenses each month or year. The first thing is to write down on paper the amount of income you bring in after taxes. If you are 1099’d then set aside enough money to pay your taxes when you get paid, not a year from now.

If you don’t know what a 1099 form is, let me explain. Some people, such as independent contractors, are paid the whole amount due them for their services without any taxes taken out of their paycheck. Yep, if you are one of those people you need to plan ahead and be ready to pay those taxes when due, so set up a savings account now and set the money aside. And while you’re at it, set up a savings account for you and your family for other things too, like a vacation, college funds, funds to cover co-pays for medical expense, etc.

Wait, you may think there is no way I can put any money in a savings account right now. I remember when Mark and I were first married and he was in college and we were expecting our first child. We both agreed that I should be home with our baby girl. We also realized it would take some work to cut our expenses because I would no longer have a paycheck.

I decided I could use my sewing machine if people needed something sewn I could do it for a small fee. I also took in ironing, wow, no one irons much these days. Then I started babysitting for mothers in the neighborhood that needed someone to watch their kids. It was hard, but I knew I didn’t want to work outside the home. I also love children, so I was anxious to help other mothers who were working.

Mark worked an extra night job or two, and we could soon see we could do it. Yes, it was hard work, but it was worth it. And we put him through school without any student loans.

1. Put Your Budget In Writing

I wish schools and churches would teach our youth how to make a budget, put it in writing like a roadmap. This is where we are right now and this is where we want to be. We have all heard the statement you can’t squeeze blood out of a turnip, I get it.

2. Find A Way To Bring In More Income

So, we have to make some tough decisions, where can we cut expenses and how can we bring in more income. Simple as that, or is it? It’s hard to think I have to get another job or cut out our cable bill.

3. Write Down Expenses and Income

First of all, don’t be tough on yourself, this will help the entire family learn to live on less and work harder. It’s okay, you can do this, I promise. I’m going to list a few places to possibly cut expenses. I want you to write down your income as I mentioned above. Grab a piece a paper and write it down. Now, write down all of your expenses you’ll be faced with this month. Of course, our rent or house payment will be the first thing to pay and then our utilities. Then list your car payment, food, clothing, school loans, and so on.

4. Set Up A Savings Account

Please save at least $10.00 every paycheck for your savings account as a starting point, more if you can afford it. If you set it up by automatic payment you won’t miss it. Please start small and it will work, you can skip eating out or your soda pop run. In the end, having a few bucks in the bank is awesome!

5. How To Cut Expenses/Wants or Needs

This is a really long list of ideas to help you cut expenses, they may or may not pertain to your situation. But we need to think out loud how to cut our spending.

1. Put money in envelopes to help you budget for groceries, haircuts, clothing, eating out, medicine, Doctor/Dentist visits, dog grooming (for gas I use my debit card)
2. Cut your own family’s hair
3. Eat at home every meal, if possible (consider sending a sack lunch with the school kids)
4. Cook from scratch
5. Stay out of stores
6. Turn lights off when you leave a room
7. Keep the blinds closed on those hot days to help with utilities
8. Unplug electronics that are drawing electricity when not in use
9. Skip the pedicures or manicures
10. Stay away from the corner soda pop stores
11. Do you have a landline and a cell phone, can you cut one?
12. Get a clothesline and hang your sheets to dry
13. Can you cut your entertainment expenses?
14. Can you downsize your house or apartment?
15. Cut your food bill by growing a garden
16. Cook less expensive meals
17. Pack lunches with leftovers, even you and your spouse can take lunch to work
18. Buy little if any convenience foods
19. Make your own bread
20. Can you trade your car in for a less expensive car or truck?
21. Use coupons wisely, sometimes you can get a gallon of milk if you buy a box of cereal
22. Watch for meat that is slashed in price
23. Watch sales and shop at cheaper stores, if possible
24. Ditch cable or cut it way down if possible, look at Hulu and Netflix
25. Skip the monthly subscriptions for magazines
26. Go to the library and get movies, books, or audible books
27. Use cash whenever possible, when it’s gone it’s gone
28. Track what you spend, write down everything you spend money on
29. Sell items in your house you are not using or may never use (extra income) it also makes you think twice about spending money on things you don’t need
30. Cash is self-control, it takes some work but so worth it
31. Have fun going on cheaper dates
32. Cut lessons if you can’t really afford them
33. Get help if you can’t afford groceries, food stamps are there for short-term use to help people
34. Save gas in your cars by planning those trips to town, combining all the errands into one trip
35. Janet, another thing, is after you pay off the car, keep it a long time, and put the money in a savings account for when you buy a new car. Cars depreciate so much. The worst investment you can make, but necessary.

6. Budget With Envelopes

Leanne reminded me to set up equal pay with monthly utility bills. I have always done that and I take it for granted. It’s awesome because there are no surprises like high bills!!

Groceries

$50.00 dollar bills (set your budget and put large bills in your envelope) if you go to the grocery store, you put the change in your grocery envelope. For instance, if your budget is $300.00 and you spend $80.00, you place the remaining $220.00 back in the envelope for the next grocery shopping day.

Haircuts

$10.00 and $20.00 bills, fill the envelopes tagged with each person’s haircut. For instance, Mark’s haircut is $15.00 including a tip so I put $15.00 in one envelope. My haircut is $20.00 every two weeks so I have two envelopes, one for Mark and one for me. My envelope has $40.00 in it.

Clothing

$20.00 bills (set your budget and stick to it) Once you realize how much you are spending out of your envelopes you will cut back big time because the cash is gone. It’s hard in the beginning, but you can do it.

Get Out Of Debt

Pay off your car as soon as possible, buy a cheaper car if you need to. Get by with one car if you can. Don’t carry any credit card debt. If you have credit card debt pay more than the monthly required payment. Debt owns you. Don’t buy stuff just because you want it, just consider those things you really need.

Please let me know how you have learned to cut expenses and cut your budget, I love hearing your thoughts and ideas. We learn from each other. May God bless you and your family for being prepared for the unexpected. Staying out of debt makes us more self-reliant. We can cut our budget even when we think we can’t.

Copyright pictures:

Piggy Bank: AdobeStock_79298456 by Rob Hyrons