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Tips to Curb Your Spending When the Economy Is in the Trenches

Updated: Nov 30, 2022

With inflation at an all-time high, many of us are taking a hard look at our spending habits. If we’re honest, as we’ve become more financially stable, we let lifestyle creep set in. That’s when the extra income we get from a raise or a new job goes into our way of living instead of our savings account. A 1-2% raise can alleviate some financial pressures, but as you relax your purse strings, new spending habits creep in. For example, instead of packing your little brown lunch bag for work, you start eating out for your lunch break. Or you add extra retail therapy to your weekends. But the current economy is forcing us to examine our spending habits under the microscope. If you need to make some changes to your finances, remember, a little bit goes a long way. A few lifestyle adjustments can stabilize your accounts and help weather the financial storm.

Like anything in life, moderation is key. You don’t have to go all in at once. If you’re not a strong swimmer, you shouldn’t jump headfirst into the deep end, but you could do laps in the shallow end and inch your way deeper as you get stronger. When it comes to being frugal, you don’t have to cut out every expense and live off ramen, but you can make incremental changes to become more spending conscientious. Make feasible changes to your lifestyle that you can realistically achieve. Start small, and over time, work your way to the deep end.

Let’s look at practical ways to cut back on your budget.

1. How much is your morning brew costing you?

Look, we get it. Everyone needs their morning fix. If you don’t rely on it to function before 10 am, that’s great! Most of us consider it a necessity as 62% of Americans drink it every day. If coffee is a necessity for you. how much are you spending on this cup of joy? The most popular Starbucks drink, the Grande Vanilla Late is sitting at $4.15. If you get one every day, or even several times a week, that really starts to add up. You may think you depend on this sweet and delicious late to cheer you on as you start your work day, but what’s it really costing you?

According to this breakdown by NextAdvisor, here’s what the hot (or iced) cup of joe is costing you per year.

Regular Coffee Pot - $45.90 per year

French Press - $160.60 Per Year

Keurig - $533.50 per year

Nespresso - $962

Starbucks - $2,007.50

If you are regularly getting coffee from major chains, that will hurt your wallet over time. Don’t panic! We don’t want you to give up coffee! But how can you make it more friendly to your budget?

If you LOVE the taste of fresh delicious coffee, try making it at home! You can buy an affordable coffee bean blender and coffee press for around $30. Even after purchasing the supplies, you would still be paying under $200 a year for coffee.

You can still get a delicious morning fix but ditch the green and white cups and settle for a to-go cup. Your savings account will thank you.

2. How much is eating out costing you?

Food is a hard one to cut back on because it’s easy to justify. Our basic needs to function are food, water, and sleep. Yes, a good meal nourishes our bodies and satisfies our souls, but how often do we justify the high price of eating out?

According to a survey by Fourth, the leading hospitality operations platform, 56% of Americans go out to eat or get takeout/delivery 2 to 3 times a week. 10% eat out 4 to 6 times a week, and 6% eat out every day

Even if you’re nifty and thrifty, how much do you spend a day on food? The most recent USDA findings for individuals 20-50 is $66.50 per week. That comes down to $9.50 per day.

You’d be hard-pressed to eat out for $9.50 outside of fast food for one meal alone. $9.50 per day is around $3.17 per meal. If you compare a meal for $3.17 to the average dinner at Chipotle for $15, the average meal out costs you almost $12 more than eating at home. Eating out three times a week would add up to $36 extra dollars spent on food. That’s only for one person.

At $15 per meal:

A couple dining out 3 times a week adds up to $90 a week, totaling around $360 per month.

A family of four dining out 3 times a week adds up to $180 a week,

totaling around $720 per month. Meal planning and stocking your fridge can help you avoid the pitfalls of eating out too much because “there’s no food at home.” Look over your bank statements and give yourself a reality check of how much you’re spending on your food and compare it to the USDA food plan. There could be vast room for improvement. ​

3. Budget Fun Money instead of splurge spending

A tactical mindset for saving money beings with creating a budget and sticking to it. A solid way to categorize your budget is 30% Housing, 30% Debt, 30% Saving, and 10% Fun.

Fun money is the category of your budget where you spend money on wants rather than needs. ​ What purchases should be put in the fun money category? Any purchases that are for entertainment or for personal enjoyment will typically go into this category. So, retail shopping, fun nights out with your friends, etc. These kinds of non-essential expenditures should fall into that section of your budget. ​ This portion of your budget is important because it leads to a less anxiety-filled life. When money is tight, you can be internally plagued by every personal purchase that you make. But when your weekend adventures are purchased with purpose, you shouldn’t have anxiety because that’s what this portion of the budget is for! It’s controlled spending. Keeping to the confines of the set amount prevents you from getting overwhelmed and can keep you out of credit card debt. ​ Setting aside fun money is important because budgeting is HARD, and we need to reward ourselves for sticking to our financial goals. Living on a budget can feel very un-rewarding but taking time for yourself can help you apricate it more than you would have if you treat yourself every time. You can have confidence in being a strong, responsible adult that’s on a path to financial success.

One Day at a Time

As the economy shifts, we have to shift with it. You may have to bend your finances a little, but you can be empowered by maintaining control. By implementing small changes, you will not have to overextend yourself. No one enjoys the panic of falling short of paying your bills, but tiny changes can allow you to take control of your finances instead of letting them control you. ​ Cutting back on your expenses shouldn’t be viewed as a life sentence. You may have to live less extravagantly than you want to, but the money you save now can evolve into serious financial security later on. Imagine if you’re thrifty lifestyle extends through the tight times, and you continue to save after the economic storm passes. What if you could break free from credit card debt or pay off your mortgage?! Focus on the benefits of being frugal instead of the setbacks. Lifelong accomplishments are made by making good choices each day. ​ It's almost impossible to completely change your lifestyle overnight, so start small. Sit down and make a list of what changes you can implement into your lifestyle to promote financial peace and security in the long run. You won’t regret it.

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