I was reading this article on MSN about a woman trying to survive on $32,000/year and how the first crisis for the poor was the gas prices of last summer, not the stock price and housing collapse of now. This woman went from being able to put away $40 per month to draining her savings to pay for expensive gas. I was sympathetic with the woman until the point in the article where it said that this woman, poor woman, had to switch to Kool-Aid packets instead of soda for her kids to drink. What!? To me, this right here is symbolic of something wrong in America. We regard luxuries as necessities and cry "poor me" when forced to curtail any luxury.
If it came right down to it, where money was that tight, what would you plan to change in your life to decrease your expenses? To, in the words to one of my favorite songs (by Bad Religion, from their "How could Hell be any worse" album with a picture of downtown L.A. on the cover) "dig real deep, and give until it hurts"?
Here's what I would do:
No more cable, because TV is not necessary. If I want the internet I can go to the library or go to work early and do my surfing before my shift starts. No more eating out, period. Purchase staples such as rice and oatmeal in bulk, cook a big batch at the beginning of the weak, and eat it all week long. Cut down on eating meat to three days a week or so. Utilize more of the produce that grows in my yard: almonds, oranges, lemons, peaches, plus my vegetable beds. Cancel the house phone, switch the cell (have to have a cell for work) to pay as you go and use it minimally. Use the free bus pass offered by my work even though taking the bus makes my commute three times as long. I could also earn more by taking a second job and only giving myself one day off a week. Life would be less pleasant if I did this but I could shave about $500+ from my budget, or more, and increase my income by $1000/month or more with the extra job. I call that painful but it would still leave me with my own roof over my head, a full belly, and still making contributions to my retirement plan as well as making additional principal payments on my mortgage. If I stopped contributing to my 403(b) and stopped making principal payments I could save another $1400 per month. Overall, if I was super hurting for cash in the short term (and still had my job) I could find an extra $1900+ in my budget with the possibility of more if I work another job.
Until I really looked at it I had no idea there was so much wiggle room in my budget. How much room is in your budget?