Thursday, October 16, 2008

Evaluation of "Necessary" and "Unnecessary" Expenses

I recently went through my August expenses. I wanted to see how much we could save if we cut ourselves back to the bare necessities. I figured I would come up with a lot of extra money spent, but I really didn’t. Granted, we’ve already cut our lifestyles back tremendously, but I still thought there should have been more to cut. Or maybe I’m leaving things in there that really should be cut out.

The first time I went through the list, I was able to remove a total of only $917.62. Some things included in this list are:

  • Green’s piano lessons at $12 per week.
  • Sports pictures, and I only got the standard solo shot and team shot.
  • All eating out, of course.
  • Specialized diet food for our pets (they have weight issues and tear their ACLs when they get too fat!)
  • Some clothing purchases for the kids where I probably could have gotten something cheaper at Wal-Mart.
  • High-speed internet at $50
  • A motivational book for $25.00
  • Cable at $40 or so.
  • Daily newspaper

That’s about it. I went through the list again to see what could be cut but found it difficult to come up with much. My grocery bill is already way below the norm for a family of 4, so I really can’t go any lower on that. Gas is a major expense for us since we both commute to work, but I suppose we could watch that more on evening and weekend trips. Overall, I’m pretty bothered by what I found – or didn’t find. I’m sure if push came to shove there would be other things that would have to go, but it scares me to think of being in that position.

I encourage you to do this with your own expenses. The point of the exercise is to figure out exactly what your family needs to live month to month. How bad would it be if you were suddenly without your income or your spouse’s income? Would you be able to make it without going into debt? It’s imperative that you are prepared. And the best way to be prepared is to not have silly debts sitting around being ignored.

Help me out. What are some things that you would cut out if you had to, that I didn't mention above?