Oh, it’s going to be a GREAT week of change for you, your family and your budget!
We are at a pivotal point – the point in which we are now going to challenge you to both decrease spending by 2% and increase the extra income opportunities by 2% at the same time.
This is where the regular, incremental changes take place that are going to make for a rock solid financial situation. The tasks on the “in between” weeks that we recommend are going to have some amazing impacts on your finances, but it is this habit that will keep you going on and on and on…
Just like we mentioned the first time we talked about decreasing spending by 2%, you will eventually hit your rock bottom budget. You will know when you get there. However, you can also reevaluate your spending each month after you hit it to be sure and monitor. We follow this process today. Most months, we don’t have anything else to drop, but every several months, we find ways that we could cut back and do! However, for most of you, as this is only the third month, most households have many more months of dropping 2% monthly spending before reaching their rock bottom budget.
In fact, since this is just the third month, you probably still have quite a bit of wiggle room in your grocery, eating out and household products budget. We shared many tips in the first month’s spending decrease challenge with a list of things to work through step-by-step in the all things food and household products spending. Please continue to implement the grocery changes step-by-step. For us (and many others) this seriously is a several month process. And that’s perfectly fine and will often be more than enough each month to help you cut spending by 2%! Also, many of the upcoming tasks in this challenge are going to help you tighten your grocery budget even more than you are now and even beyond the list shared in the first month of 2% decrease.
If you feel you have thoroughly implemented the grocery/food/household products task list from the previous post and feel like you can’t squeeze anything else out of your grocery budget at this point, it’s time to look at the other areas of your budget and see if there are any unnecessary bills that you really don’t need. Services, fees, other payments on things you are not using, etc. Are there areas in which you could cut back and make a sacrifice? One big area that we changed several years ago was our cable/Dish Network bill. We switched to a streaming device. We have used Roku for the past several years and still have the same unit and so we haven’t changed to any other. We love our Roku and save at least $500 per year. There have since been MANY streaming devices hit the market. Read about the Roku and how we are saving over $500 per year.
Other areas to consider are insurances. We have our home/auto/life insurances reevaluated and even have agents give us the current competitive rates each year. By doing this, we have dropped our premiums a little more each year for the past several years as companies and agents want to earn your business by being a little more competitive. Also, explore our site, the frugal living and finances section and more for even more ideas. Many often think “I don’t have anywhere to cut in this area” but once they actually evaluate this, they find that they indeed had one or more bills that could be eliminated or reduced!
Then of course, this is the first month where we will also be encouraging you to increase income by 2% at the same time! We have shared the articles on this and instead of restating the steps and ideas here, just see the previous articles as well as the Money Making Ideas section of our site and the Over 130 Ways To Earn Extra Income Ideas list.
Here’s the previous articles on the 2% increase:
- Brainstorming extra income ideas
- Turn your ideas into real money
- How to increase income by 2% each month
For those that are just now reading this and don’t know what we are talking about…
We recommend that you read up on a few articles regarding the 2×2 plan. This is a life-changing, incremental financial plan and one that helped us get out of $100k of consumer debt and one that has helped countless others to get to a better financial place. Start with this article talking about the 2% decrease that also contains additional links for even more details on the plan.
We also recommend that you start our financial challenge from the beginning if you want to really see some big changes with small weekly steps for the next 52-weeks! You can read about how to join us in the 52-Week Take Back Your Finances Challenge from the beginning.
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 2% Decrease and 2% Increase
Just revisit and recalculate for this month.
As review, 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. This is showing the same example as last month, but theoretically, there may be less living expenses or bills this month after last month’s 2% cut.
But in any regard, $61.80 is our target spending decrease goal for this month using these examples! Write this on this month’s Budget Summary Printables from week #7 (again only on the current month as you are going to recalculate this goal number each month).
Then follow the same steps by evaluating your income by referring to page #1 of the 12-Month Monthly Summary Budget Planner from Week #7. Then fill-in your 2% increase.
So now that you know your target goal, evaluate where you can make these changes this month.
BTW – we haven’t made it a continual challenge, but be sure that you are filling-out your 12-Month Monthly Summary Budget Planner from Week #7 each month. Just coordinate with the week you prepare to make your 2% decrease and 2% increase. Just start the habit. 🙂
Stay motivated, stay focused and stay encouraged! Big things are happening! You will be so thankful for these small steps that you are taking!
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.