We are now up to week #8 on our Take Back Your Finances 52-Week Challenge! It’s an exciting week because it is another week where we will be taking a giant baby step that will turn into long term positive financial impact!
Well, you are probably wondering what it is?
Remember back on week #3 when you created your budget using our system based on what you are currently spending? We promised that we would soon get to dropping that budget a little each month.
At least the first month’s time has come. You also may remember that week #3 was a busy week because you had some small reading assignments to complete as well – those were our 2×2 plan – 2% spending decrease each month and 2% income increase each month – to help you gain an understanding of what we were going to be doing with those budgets we created that week.
This week, we just want you to implement the first part of the 2×2 plan – the 2% spending decrease.
Here’s a link to remind you about this approach from week #3’s assignments:
- It’s Here! Our Secret 2×2 Formula We Used To Pay Off $1ooK of Consumer Debt (there are additional links within the article about why other approaches did not work for those lifelong financial changes)
Remember that we are working on this in BABY STEPS and we want to ease into these changes for 2 BIG reasons:
- It is more doable and achievable when it is not so overwhelming.
- This approach will also create the lifestyle of living as a financially free – not just a temporary solution for the short term.
Resources Needed for This Week’s Challenge
You will need to find and gather the following resources to help you complete part of the challenge this week:
- Budget Sheets from Week #3
- 12-Month Monthly Summary Budget Planner from Week #7
- Thinking Cap
How to Figure What 2% Cut Is?
First, you need to know how much a 2% cut from YOUR budget is.
Okay – so let’s share the simple math again as review and so you can figure out exactly what 2% spending cut from your budget looks like with a sample.
We are going to use our sample calculations based on the sample budget sheets from Week #3. Referring back to these sheets – there were 3 kinds: Bills, living expenses and debts. Exclude the debts form at this point. Add up your Bills and Living Expenses Monthly total.
In our samples, we have $1265 in living expenses and $1825 in bills. This is a total of $3,090. Then you will calculate what 2% of this is by taking 3,090 x .02 = $61.80.
$61.80 is our target spending decrease goal for this first month! Write this on this month’s Budget Summary Printables from week #7 (again only on the current month as you are going to refigure this goal number each month).
Where to find the 2% spending cut
The next question is now “where do we cut $61.80?,” and that is a GREAT question.
Before we share ideas for cutting this first month, we do want to point out the obvious. There will be a point in which you will reach your “rock bottom” budget. You can’t cut 2% from your budget forever. When you get to your rock bottom budget, you will know – and that is awesome! Try your best to stay there. We’ve been at ours for many years, but a few times a year, we still evaluate where we are at with our monthly spending and if there is anything we can cut. More often than not, we find that we can save a little more in a certain category, cut a service out, quit spending on something. But most everyone will have a many months on the 2% spending decrease before they get to this point.
For the first few months on the 2% spending decrease, we are going to encourage you to look to that Living Expenses Budget Sheet from week #3 as these are your most flexible and most immediate spending numbers to drop.
Again, the living expenses are the things like: groceries, gas, eating out, entertainment, miscellaneous shopping, travel, Christmas, etc. The things that can and, for most, fluctuate each month based on whether you keep your cash/card in your wallet or not! But we have found for ourselves that the anything food category is usually the best place to start; many of those places could include (and that usually adds up quickly in your budget – getting hid in your credit/debit card spending):
- Restaurants – think family dining or non-fast food in the evenings
- Lunches out – while at work our running errands around town
- Breakfasts out – when running to late stopping at the local gas station or running through the drive through
- Quick snacks “out” – this could include gas stations, vending machines, that candy bar you eye in the checkout lane 🙂
- Coffee stands – we’re not recommending cutting back on coffee but instead trying to make it at home
So generally one of these subcategories is the BEST place to start cutting that budget. And within this food category – and depending on your family, often the BEST sub-category to find your first cut is the grocery budget. In fact, we find that there is so much room to cut in the grocery budget for many households, that this can often cover your 2% decrease each month for several months.
When we implemented this system eons ago, we found the 2% in our groceries for quite some time ourselves. This is a category of spending that many can easily cut by 50% or more. It is also a very BROAD category that is an entire several-week challenge within itself. Don’t get overwhelmed, just take it bit by bit!
There are several ways to cut your grocery budget in half – but we only need 2% right now. If you are spending, let’s say $600 a month on groceries… how nice would it be to drop that down to $300-$400 over the next several months? Sweet, right? Of course, there are many factors that affect your family’s grocery budget vs. your friends – there is not a “one-size-fits-all” grocery budget. Many try to say that there is, but we have seen this fail and frustrate many families over and over again! Factors like region, family size, ages of kids, time, food allergies, grocery/big box/discount food stores, storage available in your home, etc. are all factors in making your grocery needs unique to your family.
But, there are methods, tips and resources that most all can adapt and find to drop those grocery budgets dramatically! The good news is that we have many resources on our site here to help you start dropping your grocery budget and cut it this month to total your 2% goal!
The following list of articles, tips, resources and more will help you drop your grocery budget. Each of these categories are all great ways to save a little more and drop the budget each shopping trip, whether you want to use coupons or not – and no, coupons are not required to save money on your grocery budget. You can learn to spend your time making more things at home and focusing on getting food on the table and not reverting to the expensive convenience foods or eating out.
5 Areas to help drop grocery budget with links for more information
How to Save Money on Groceries:
- How to Save $4,068 This Year on Food – This is a great place to start!
- Learn the Insider Tips To Save Big Money on Meat
- 8 Ways to Save Money on Groceries Without Coupons
- 8 Tips to Save Big Money on Diapers
- 30 Ways to Save Money on Produce
- How to Get A Great Deal on Bulk Chicken Nationwide
- How To Find Grass-Fed Beef Deals in Your Area
- Nationwide Produce Co-Op For Great Produce Deals
Dinner by 10 (read on how this saves you money!) and Menu Planning (including a no-food waste menu planner to save money by using it all!):
Free Grocery Printable Shopping Lists and Smart Phone Apps based on sales and discounts in your area (automatic 30% + savings when utilizing these tools without coupons and up to 70% or more with coupons – but just start, even without coupons!)
- Print this week’s current grocery shopping lists with the sales (and coupons where applicable) for your local grocery stores from the drop-down menu.
- Free Grocery Savings App with Shopping lists directly from your smart phone!
- Find the Best Grocery Deals with These Free and Easy To Use Resources
Articles on couponing (if this is something you choose to do):
- How Do I Start Couponing?
- Help, I’m Using Coupons But Spending More!?!
- Does Couponing Take Too Much Time?
- How to understand coupon lingo and language when you are using shopping lists
- 20 Reasons You are Not Getting the Same Results as Extreme Couponing
- Example of our real life shopping trip
- Many Sources for Printable Coupons to Start Saving Money Now (Plus, click on the “Savings” tab at the top of our page and then scroll over “Coupons” to find even more!
Recipes to replace grocery store bought items that save money and health (click on Replace Store Bought Tab in our menu above):
- Replace the grocery store by making your own homemade versions of popular store-bought foods (and in bulk)
Ok, so as long as you are not feeling overwhelmed, you are ready to dive in!
IF you are feeling OVERWHELMED, start with the first category and slowly move through the 5 areas and add them in one at a time – over time, not all this week! Each one will help you drop your grocery spending a little more.
Need to catch up? Come join us on this challenge from the very beginning by clicking on the 52-Week Take Back Your Finances Challenge and sign up to start receiving your automated challenge from the very beginning!
One final thing…we also have a Facebook Group where you can engage in discussions, receive encouragement and talk to others that are participating in the challenges too for more ideas! Head to the Be Intentional with The Thrifty Couple Facebook Page HERE and ask to join us there! You can also invite friends and spouses too!
Disclaimer: We are not licenses financial planners. We are only a couple that have been just a hair-breadth away from bankruptcy and found our way out of debt with a goal to now help others. Please make sure to consider any advice given on our site and in this challenge as tips we have used ourselves; they may not work for everyone. If you have questions please make sure to contact a licensed professional.