Budgeting your way to health | Learning to cut the fat

When I first moved to Los Angeles, I had about a hundred dollars to my name.  I had some budgeting experience from my college life (“How many cans do we need to recycle to get a thirty rack?”) but at this point I just needed to survive. I had just driven across the country from Boston for my first post college job.  I knew no one, had no money, and needed a place to live.  I ended up at a coworkers place for about two weeks and then moved into my first apartment (I’m still there and I still don’t have a fridge).  After about a year of miserable savings, I started a mint.com account and really began trying to figure out why I couldn’t save any money.  After my first month, I logged on to categorize and organize my expenses and really take a look.  What I saw shocked me.

I was spending almost $600 a month eating out and going to bars.  How did this happen?  I mean, I guess twenty-five cent wing night sort of got out of control from time to time but really? $600??  It was time to cut the fat, literally. Budgeting around my fixed costs of rent and student loans was the easy part.  Trying to figure out how to never go out to eat was a little more difficult.  It really takes an iron will sometimes.  All your coworkers are going to that awesome new burger place or the internationally renowned hot dog place and you don’t want to be left out!

This temptation is something that everyone is going to face and it’s one that a lot of us cannot say no to.  Budgeting requires an immense amount of work to keep in check.  The first few months after this revelation I still struggled.  I tried and I tried and although my happy hour attendance dropped tremendously, my lunches with the coworkers did not. I needed to find a way to force myself into action.  Budgeting for the number wasn’t enough so I began to look at how busting through my budget affected my net worth.

Eating out every day is expensive.  On an average week though, I ate out about 5 times between work and my weekends.  The average amount I’d spend per meal was $15.  Assuming I’d spend roughly the same amount whether I’m at work or on a vacation, we can safely say that I was spending $75 a week going out to eat.  That means that over the course of the year I was spending roughly $3900 dollars!

Yikes, that’s a whole lot of cash.  But wait a second, just because I’m not eating out does not mean that I’m not spending any money at all!  I do have to eat sometimes.  After doing some more research I figured out that the eventual difference between eating out and buying groceries was going to be $40 a week.  I could save just a little over $2000 a year if I stopped eating out.

Boom, that did it for me.  I always need a reason for something and numbers always work best to convince me of a certain way.  Budgeting will always be the best place to start but budgeting can only get you so far.  It’s easy to create a budget with drastic cuts and look at your potential savings with glee but it’s a lot harder to put it into practice.  Here’s my suggestion: start with small cuts.  Once you can go 6 weeks with those cuts and making them work, then work on the next item.  It takes 6 weeks of forced repetition to create a habit whether it’s working out, dieting, or budgeting.  The best thing you can do when it comes to budgeting is start small and slow and create good habits one item at a time.  And remember that when you set up your budget to always pay yourself first.  Until next time!

 

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