Budgets and Cutting Costs

Budgets are a great thing, because you can work on cutting costs once you have an accurate picture of what you’ve really been spending your money on and what your fixed expenses are. You can use those cost-cutting measures to come up with extra money — extra money that will help you get out of debt faster. Here’s how to do it.

Take a look at every single budget category and try to determine how you could cut the amount you came up with (or more) from it. Typical areas to cut back in, eliminate, or ask for lower rates in are things like cell phones, home phones, internet, cable TV, dining out, entertainment, groceries, etc. Some additional areas to ask for lower rates in are car insurance, homeowner’s insurance, and renter’s insurance. (I’m not suggesting reducing coverage unless you know for a fact that you’re over-insured, but it probably won’t hurt to shop around and ask for discounts.)

There are few-to-no categories that you won’t be able to reduce at least a little bit. Tackle one category per day if need be, but really search for ways to reduce it. Remember, even a dollar helps. Sometimes it’s a simple as a phone call. You might be surprised how many places say yes to “is there a way I can pay less?”. If you run across some place that isn’t willing to reduce their rates, don’t be discouraged. Try again in a few months or begin researching alternatives.

Go through this same exercise on a regular basis to be sure you aren’t missing out on additional savings. Rates and offers change, so it’s worth keeping up to date.