During the holiday season, we give thanks to family and friends, but we can also use this time (and really any other time) to think about what we would do if we were in financial trouble.
We all have different life situations, and different levels of comfort. We range from singles, marrieds, widows, partners, families and single parents, and may be living a frugal lifestyle on the bare minimum of state/federal income, single or dual incomes, or may even be millionaires. I can’t write about all of your situations, but I can write about our own to give some insight into what you could do during financial trials.
Giving Up the Luxuries
I went through our budget to see what kind of “luxuries” we have and what would be on the quick-hit list of things to cancel/sell-off to help create some extra room in our monthly budget. Some items are bigger than others, and are thus more useful to drop when things are tighter.
We all have different ideas of what a “luxury” is. For us, it’s our cable, gym, dining out and some other categories. But for you, your car may be a luxury. For others, you may not be able to survive without cable TV. But the goal here is to make an effort at classifying our expenses and learning what we can do without when it matters. In parts Two and Three, I’ll talk about our “Semi-Luxuries” and “Essentials”.
Obviously the first little luxury that would go is cable. For many of you, your bill is between $50-150 and even higher. For us, we pay about $20 per month for basic cable. We pay for cable in order to get clear reception of network channels rather than trying to mess with an antenna or spending loads to get a bunch of channels that would only waste our time.
Although many bloggers abhor gym memberships because they seem to be a waste of money, Stacie and I actually only pay $25 total per month for both of our memberships. We belong to Bally Fitness and went through the 3 years of $100 total monthly payments in order to get down to the special post-contract rates. Since we also have a free “dumpster treadmill”, and can work out in many other ways than at the gym, we could do without this monthly drain if needed.
Many of you pay between $40-90 per month for your home phone bills, but Stacie and I use Vonage’s 500 minute plan and only pay about $20 per month. However, we also have cellphones and barely use the home phone. We do like to have the home phone so that we’re not giving out our cell numbers, but if we needed another $20 per month, we could give up this luxury.
Our monthly budget for dining out for lunch (me) and dinner (us) is $300. If we never dined out, we would probably need to bump our grocery budget up by $100. Savings here would be $200 per month.
Parking at the Metro:
I ride the metro to work, and we’re walking distance to numerous bus routes and 2 metro stops, but since I’m going to school, I drive to the metro twice per week to save 20 minutes of walking each way. However, most times I end up having enough time that I could walk home (if I had to). I pay $4 per day to park at the metro, so walking those 8 times per month (twice per week) is a $32 savings.
TOTAL LUXURY SAVINGS: $297.
This doesn’t seem like a big savings (to us) because it wouldn’t do much towards our monthly bills if either of us lost our job. However, it’s a start, and could pay for our more essential utility bills if that’s all the help we needed. These luxuries are things we could easily give up right now, but we’re keeping them because we can pay for them.
What are your luxuries? These are expenses you could easily do without today if you had to. Be honest with yourself. Oh, I should tell you that tomorrow I’ll be posting a “Semi-Luxury” category that are almost essentials, but not quite. These are items that would make your life difficult to live without, but you have other fairly easy and free alternatives. Here’s a hint (internet, extra vehicles).