Money Problems – Day 6: Reducing Expenses

Today, I am continuing the  series, Money Problems: 30 Days to Perfect Finances.   The series will consist of 30 things you can do in one setting to perfect your finances.  It’s not a system to magically make your debt disappear.  Instead, it is a path to understanding where you are, where you want to be, and–most importantly–how to bridge the gap.

I’m not running the series in 30 consecutive days.  That’s not my schedule.  Also, I think that talking about the same thing for 30 days straight will bore both of us.   Instead, it will run roughly once a week.  To make sure you don’t miss a post, please take a moment to subscribe, either by email or rss.

On this, Day 6, we’re going to talk about cutting your expenses.

Once you free up some income, you’ll get a lot of leeway in how you’re able to spend your money, but also important–possibly more important–is to cut out the crap you just don’t need.  Eliminate the expenses that aren’t providing any value in your life.  What you need to do is take a look at every individual piece of your budget, every line item, every expense you have and see what you can cut.  Some of it,  you really don’t need. Do you need a paid subscription to AmishDatingConnect.com?

If you need to keep an expense, you can just try to lower it.  For example, cable companies regularly have promotions for new customers that will lower the cost  to $19 a month for high-speed internet.  Now, if you call up the cable company and ask for the retention department, tell them you are going to switch to a dish.  Ask, “What are you willing to do to keep my business?”  There is an incredibly good chance that they will offer you the same deal–$20 a month–for the next three or four months.  Poof, you save money.  You can call every bill you’ve got to ask them how you can save money.

I called my electric company and my gas company to get on their budget plans.  This doesn’t actually save me money but it does provide me with a consistent budget all year long, so instead of getting a $300 gas bill in the depths of January’s hellish cold,  I pay $60 a month.  It is averaged out over the course of the year. It feels like less and it lets me get a stable budget. Other bills are similar.  You can call your credit card companies and tell them everything you take your business to another card that gave you an offer of 5% under what ever you are currently paying. It doesn’t even have to be a real offer.  Just call them up and say you are going to transfer your balance away unless they can meet or beat the new interest rate.  If  you’ve been making on-time payments for any length of time–even six months or a year–they’re going to lower the interest rate business, no problem.  Start out by asking for at least a 5% drop.  In fact, demand no more than 9.9%.

Once you’ve gone through every single one of your bills, you’ll be surprised by how much money you’re no longer paying, whether it’s because somebody lowered the bill for you or you scratched it off the list completely.