Saturday, September 14, 2013

How We Cut our Expenditures in Half

Dining at Sky City, the Seattle Space Needle.
You may have seen recently (on Instagram or whatever) that Dan and I have been out a on a few fancy dates. And, we are about to go on a Mediterranean cruise.  And, we are saving money to buy a house. And, spoiler alert: we are not rich. So, I feel like I need to explain a few things. The dates can be explained by a few Christmas giftcards, the cruise is a special treat we've been saving up for and we got a great deal through our friend who works for the cruise line. But, let me explain the rest....

A few years ago, with the loss of a steady income from Dan (due to his new music career and the unpredictability of being paid as a musician) we embarked on a quest to cut spending and increase savings. 
  1. We started by renting out our house. We eventually sold the house but renting it out was a great option for us. We found a great place to rent (the downtown loft and then the place we are in now) and our pricey mortgage was being paid for by college students. It was is weird renting after being a homeowner but it was better than stressing out about making ends meet.
  2. Now that our rent/mortgage had significantly decreased we tried to live off of one income
  3. Then we started to save. We saved everything Dan made and used my income for paying the bills. But how we saved is key. We had a bank account that we didn't use much. We dont even have debit cards for this account. So, we use that as our savings. We can't get to the money - unless we drive to the bank, go inside, and ask for it. I highly recommend this method of saving. If you have access to your savings, you'll never save. It's so easy to transfer money from savings to checking in a pinch and we wanted to get out of the habit. 
  4. Next, we started to eliminate our debt. We paid off credit cards and never used them again and made bigger payments on student loans until they were all gone.
  5. Then, we got rid of our "newer" car. The one that wasn't paid for. For a long time we drove around a very old BMW as our primary driver. We paid $1200 cash for that BMW and it was the same cost of up-keep as our '06 Chevy. We saved ourselves $240/month plus another $120 for the insurance (you have to have extra insurance on a car that isn't paid for) by selling the Chevy. We sold it to the dealership and even paid them a little to buy it and wholesale it but it was worth it. We saved ourselves $4000/year by driving the BMW instead of the Chevy. Eventually we saved up enough money to buy another car so that we have 2 again. Totally worth it to buy your cars with cash.
  6. What can you live without? We cut out any unnecessary expenses and took a look at EVERYTHING we were paying for. I gave up my gym membership and bought a treadmill on Craigslist. I found a cheaper internet provider.  Can you give up cable for Netflix or Hulu? Do it. You wont miss it.
  7. Lastly, I had to stop going out so much. You cannot spend $4 on a coffee every day when you're trying to save money and be responsible. Before I became a mom I was out every night of the week at a concert, a happy hour, tea, coffee, wine bar, dinner, dessert, whatever. It had to stop. It was a huge adjustment and I miss it. But, I think our friends have been happy to come to our house and save money by not meeting up for "half price apps" and just watching a free movie on Netflix. (Maybe our friends are cheaper than your friends?)
It really isn't as hard as it sounds. You do things slowly and you'll never notice the sacrifices you've made. When I look back at how we used to live, I dont see what I'm missing out on now, I see how I was throwing away thousands of dollars without even realizing it. 

It's worth it, for the day to day, but when we put a big downpayment on a house - or even buy a house with cash - it will really be worth it. So, that's the story of how we cut our living expenses in half - even after  a major career-change and becoming first-time parents.  Please feel free to ask me any questions!  

The view from the observation deck on the Space Needle.


  1. Love this post! This is great advice! We too live off of one income, as my husband is still in school. And yes, we too have {mountains} of student loan debt. Adjusting to living frugally can be hard initially, but after a while it just becomes the new routine. I do love your suggestion about the separate bank account for savings :)

  2. I wish we had done all this before it became a necessity. We didn't realize it at the time, but before kids and our house we were living the high life! Thank goodness our income has been steadily increasing along with our expenses. We are still in debt payment mode, but man I can't wait until we can actually save some (when the kids are out of day care and in pubic school!)

  3. I totally love staying in and entertaining at home. It really does help and my friends can bring their kids, too! I also agree about how the little things add up. For me, if I do go to happy hour, then I add on a drink, then another app then I'm spending about the same amount of money. So it's easier to eliminate that and stick with my friends, who are usually parents, too, who do the same.


Thank you so much for commenting! I love feedback and I read every comment and would love to respond to you! If you want to be notified of a response, click that little "notify me" box! xo, Lindsy

Related Posts Plugin for WordPress, Blogger...