Trimming the Fat from the Family Budget

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Photos courtesy @JimmyDean

Annie Peterson | Civil Patriot

Remember that nutty “I Love Lucy” episode where Ricky accused poor Lucy of overspending? Her financial shenanigans forced him to place her on a ridiculously tight budget. She responded by defiantly cutting back in her unique way, starting with sewing her own clothes. She also opted to style her own hair (an oddity in those days) and cook micro-budgeted meals. What a fiasco! In the end, Ricky ended up spending more getting her out of the mess than he would have if he had left things alone.  So much for budgeting, right?

Wrong! 21st century families still struggle with Lucy’s core problem. We overspend.  However, unlike that famous television couple, modern families really are learning how to cope with a budget out of control. First and foremost, they are taking ownership of the problem and doing something about it.

Ten Budget-Slimming Ideas

There are several common-sense ways to cut back. While others around you are scratching their heads, complaining about their bloated budgets, you can actually be doing something about yours.  Here are ten practical suggestions for “trimming the fat” from your family’s chubby budget:

1. Strategy:
Clearly the first step in the process of cutting back lies in coming up with a workable plan.  Where does such a plan come from?  It often springs from desperation, to be quite honest.  A family gets in over their heads and needs a way out, so they ‘go on a budget.’  All fine and good, if sticking to that budget was possible. Problem is, many well-intentioned plans aren’t feasible. They’re too tight or too loose. Once you’ve established what is truly realistic for your current financial situation, present said plan to the whole family (yes, the whole family) and ask for suggestions. Based on those suggestions, put together something on paper so that no one forgets. Then implement that plan as a family unit. Do your best to stick with it.

2. FOOD:  In the Mouth – Out of the Pocketbook

Eating Out:
Not surprisingly, food eats up a good chunk of our budget – no pun intended.  In particular, eating out seems to zap our finances. We’re exhausted after a long day at work, so we zip through the local fast food restaurant. We’re in a rush to get to the soccer game for the kids, so we pick up a burger and fries instead of stopping to pack sandwiches.  According to franchisehelp.com: “There are over 200,000 fast food restaurants in the United States and it is estimated that 50 million Americans eat at one of them every single day.” And don’t forget, the cost of fast food is on the increase. (So are our waistlines, by the way.)

Eating In:
Eating in doesn’t always solve the problem when it comes to overspending on food purchases. Commercials advertise mouth-watering delicacies at every turn.  The grocery store does a more than adequate job of displaying expensive, tantalizing treats at the end of every aisle. The average family spends upwards of $7000 a year for food! This is a staggering amount of money for the average family, but there are ways to trim, even in this area. Learn to cut back in simple, old-fashioned ways.  For example, create and use menus.  Encourage the whole family to get involved.  Let different family members cook each night of the week. Try to out-do one another with frugality. (My meatloaf surprise only cost $4.59 to make! Oh, yeah?  Well my chicken casserole is a winner at $3.99!)

3. Eliminate Personal Debt
Eliminating personal debt is critical when it comes to trimming the fat. Credit cards, in particular, seem to zap our resources. It starts out so innocently. You use the credit card to make a few small purchases. No big deal. You pay the minimum amount due. You continue to pay the minimum amount due. Approximately two years later, you’ve compounded your original expenditures four or five times over.  Sound impossible? According to thebalance.com: American consumers began the year 2020 carrying a whopping $1 trillion in credit card debt. It happens every day and families don’t even realize what they’re getting themselves into. Many use the cards for convenience, others because they’re short on cash.  Interest adds up quickly and varies depending on the size of payments made. A 16% APR translates into a total payment of $13,991 on a credit card balance of $5,000 if only the minimum 2%, or $100, is paid each month. 

No wonder we have such a monstrous problem on our hands – and no wonder so many families spend their evenings avoiding calls from bill collectors. There are ways to eliminate personal debt without further destroying your credit. Credit counselors can help, but so can this simple step: If you don’t have the cash on hand to pay off credit cards in full, consider taking out a low-interest loan. Once you’ve paid them off, place your credit cards in water and put them in the freezer. Next time you feel like spending, remove the block of ice from the freezer and allow it to melt on its own. If, by the time it’s melted, you still feel the need to use it, you will surely do so more wisely.

4. Entertainment
“Take me out to the ballgame… or the movies, or the theater…”  We love to be entertained, don’t we? According to howmuch.net American families average $3203 per year for entertainment. That’s approximately 5.3% of their annual budget. This may sound like fun, but what at point do we say, “Hey, let’s just stay home tonight and put together a puzzle?”  Entertainment is the rule of the day, and teens, in particular, seem to think (for whatever reason) that they deserve it. Sure, entertainment is a form of escape, but when we’re spending $462 billion a year on leisure activities, how are we going to escape when the bills come rolling in or when we’ve sacrificed in one area so that we can exceed in another? The answer to this is really less stressful than it seems. Cutting back doesn’t mean never going out. It simply means carefully choosing when and where you will go – and how much you will spend when you get there. Besides, when your visits out are fewer and father between, you will appreciate them more.

5. Running Money – Just Say No
We call it “pocket money” or “running money” – the stuff we need to “get through” the next few days.  Problem is – our pocket money never seems to stay in our pocket. It slips right through that invisible hole at the bottom. Many of our impromptu decisions are to blame.  We decide to go somewhere spontaneously. Then we drop $50 – $100 on our unexpected evening out. Too many nights like this and our budget doesn’t stand a chance.  Set a reasonable limit for pocket money and stick with your decision. Don’t run to the ATM for every little thing. Don’t depend on the debit card to bail you out when the cash runs low.  Instead, find creative ways to s-t-r-e-t-c-h that spending money. I have one friend who carries a pre-determined amount of weekly cash in an envelope in her purse. She always seems to have cash on hand when she needs it, but when the envelope is empty, the fun is over!

6. Re-analyze “necessities”
Even if it hurts, honestly assess your need for things such as cable television, cable modem/high speed Internet access, multiple cell phones, car washes, manicures, etc.  Little cuts can make a big difference over time. Many families have discovered that they don’t need cable television in every room.  They don’t need high-speed internet access on every P.C. They don’t need a cell phone for every person in the family.  They don’t need particular name-brand items or luxury items. When it comes right down to it, what we need and what we want are often two very different things entirely.

7. Use Utilities Wisely
A lot of money is wasted on utilities.  Adjust the thermostat to a practical setting in both summer and winter. If you’re too warm or too cold, try changing your clothing to accommodate instead of touching the thermostat. Fix all leaky faucets and/or toilets to save on water and remember to keep the vent registers clean. Turn off lights when they’re not needed.  Don’t leave doors and windows open for extended periods of time when you’re running the A/C or heat. Insulate your water heater and make sure its temperature isn’t set too high. Purchase a water-saving showerhead for your bathroom. These and other small changes can add up to big savings over time.

8. Shop Around:
Look for less expensive services. A friend of mine recently told me that she received auto insurance quotes for her family of four from several different carriers. She was stunned to learn that she could save several hundred dollars a year, simply by changing companies.  The same is now true with phone and electric services, as well. Monopolies used to “own” territories, but in many places around the country, customers are now free to choose providers of their choice. This is also true for those who need Internet access, web hosting sites, etc. Careful shopping and wise choices can result in phenomenal savings. 

9. Lessons (Ballet, Piano, etc)
Little Susie loves her ballet lessons and Johnny really excels at softball.  Milly’s great on the piano and Mark is surprising you with his drumming abilities.  You can’t help but pour money into these things, particularly those things that seem to come naturally to them.  Children need to be encouraged in their artistic and sports abilities, but there are ways to cut back, even in this area.  Parents, look through the paper to find out about local co-op programs.  Homeschoolers, in particular, will find that they can swap out piano lessons for sewing lessons – that sort of thing.  Find out if your community has an “all in one” arts program – one place where your child can take music, dance, art, drama, etc – all in one building for one set fee.  Such places do exist and they can save you a bundle (in gas alone!)  If you can’t find such a place, why not go together with other artistic and sports-minded friends and start a program of your own?

10. Refinance (anything and everything)
A friend who works at a mortgage company recently told me that she helps people save hundreds of dollars every month, simply by refinancing their homes while interest rates are low.  This is an excellent time to take advantage of the opportunity to lower monthly payments, not just on your home, but your car, your credit cards and more.  As mentioned earlier, if you’ve got a lot of high-interest credit card debt, you could consider rolling all of it over onto a card (or bank loan) with a considerably lower rate.  This one move could save you thousands of dollars and lessen your workload each month, as well.  

Budget Ideas That DON’T Necessarily Work

Shopping in Bulk:
Don’t be shocked! Shopping in bulk often causes us to purchase an excessive amount of one thing or another. These things may or may not ever get used in the real world. Many times, the family will grow weary of that particular type of cereal or this particular flavor of soda. Excess foods grow stale or get tossed after months of not being used. Many stores that sell in bulk also charge a membership fee and this can add up, as well. A better suggestion would be to shop around. Find the grocery store in your area with the best overall prices. 

Using Coupons:
While shopping with coupons can be a good thing, buyer beware! Many unsuspecting families find themselves buying things they would never have considered, had it not been for that tempting little coupon. Just be sure you’re only purchasing something you would have purchased anyway – even without the coupon.

Using Credit to pay monthly bills:
Pulling out that credit card to pay the phone bill might be convenient, but you never had to pay interest on your phone bill before, did you?  Why now? If you like the convenience of paying your bills by phone or over the Internet with a credit card, just make sure it’s a debit card – and also make sure you’ve got enough money in your checking account to cover the payment.

No matter how severe your problem, keeping an eye on the budget will surely benefit your family. Enter into it with Lucy’s enthusiasm, but be careful to approach the project realistically, with your own family goals in mind. After all, Ricky might not be around to bail you out, should you need him. 

 

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