After years of working at it, I finally feel like my monthly expenses are low enough. My spending during the past few months has averaged about $1,500-$1,600 per month, which is down from the $2,300-$2,400 per month that I was spending three years ago.

Leftovers in refrigerator

If you are trying to cut your spending and are not sure how to do it, hopefully my approach can help. Here’s how I cut the $800 out:

I Got Out of Debt (-$415/month)

I never liked debt. I felt the need to pay off my debt even before I knew of Dave Ramsey. But after I started listening to him, I knew I needed to get out and stay out. I had two debts back in 2008; a car loan and a student loan. They totaled $25,000 at their peak. The monthly payments totaled $415 per month ($350 on my car and $65 on my student loan).  That meant that my loan payments were almost 20% of all my expenses. Ouch. Well, I sweated for two and a half years to pay off my car. Then, with the free $350 every month, it didn’t take long to knock out the student loan as well. This was the beginning of my momentum and a critical step in cutting my expenses.

I Got Rid of Unnecessary Bills (-$75/month

The first unnecessary bill I cut was digital high-definition cable TV with hundreds of channels. Instead of cutting slightly, I decided to do away completely with all $60 worth of it. It hurt at first, but I don’t miss anymore. Besides, there are many ways to get your entertainment using the internet. I use Hulu.com for free, Netflix for $8/month and I rent movies once in a while from iTunes for $3.99 each. Of course, I do have my TV hooked up to my computer, but that’s an easy thing to do nowadays.

My second unnecessary bill was unlimited text messaging, picture messaging and data on my cell phone plan. I simply wasn’t using any of it but regular texting. A quick analysis of my cell phone bill revealed that and after a short phone call, I had shaved another $15 off of my monthly expenses.

I Cut Discretionary Spending (-$315)

I cut down immensely on eating out and instead, bought a full week’s worth of groceries every weekend and brought lunches to work. This shaved another $80-$100 per month off my spending. I also stopped shopping for fun or out of boredom. I decided to only go to a store if I absolutely NEEDED something and if I had a list. This cut $100-$150 per month from my spending. Last but not least, I quit smoking. I actually just did this one month ago. Yay, I am on a role! Anyway, that was an additional $65 every month.

I believe the key to cutting your monthly expenses is figuring out where you are spending your money. Once you know where it is going, you can take action on telling it to stop going there and go to your savings account instead. Good luck to you all on your expense cutting journey.

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