Cutting expenses is, of course, a vital part of good financial health for most people. I had to figure out a way to cut back by about thirty percent a while back when I realized that my income was just not high enough to cover my expenses and my savings rate was near zero. The first and most obvious thing to do is to reduce your expenses; I have written many articles on the subject.
The first thing I did was cancel all of my magazine subscriptions (except for those I received as gifts). This gave me an extra $50 or so per month… This may not seem like a lot but think what $600 a year would do. It was basically like getting a small raise!
Next I started using my local library more instead of buying the books I wanted to read. My library is fairly piecemeal – I aggregated books others didn’t want, those I bought myself, and some from my parent’s home, among a variety of other places.
You don’t need designer clothing or shoes, $100 haircuts, or a brand-new car. Simply not buying these saves you money and will increase your savings. However, do think about one thing: cutting expenses only works to a point. You can’t overdo it or your quality of life is going to fall dramatically to the point where you are unhappy. Part of being financially healthy is also reaching your goals; living frugally will handle one, but if you are miserable there are other ways.
Just try to keep everything reasonable. If you remove something from your monthly expenses, you shouldn’t suffer overmuch. Depending on your situation, some sacrifices may have to be made, but a good rule of thumb is that expenses you cut down should take as little effort as possible and make you relieved rather than feel worse off.
Now, if you are over your eyeballs in debt and in danger of losing everything, by all means, eat ramen, rice, and beans, cut all of your V/D expenses, and look for quick ways to earn extra income. But if this isn’t the case, take all of the advice and tips in here with a grain of salt – nobody follows all of them, not even me. The main idea is simply to become conscious of the options available to you for improving your financial health.
Tags: budget activities, Budgeting, finances, happiness, life, luxuries, money, savings
