How to Cut Your Bills In Half and Lower Your Expenses
Whether you're moving from two household incomes to one, saving for college or simply have been hit hard by the economic recession, the easiest way to improve your financial situation is by reducing your bills and lowering expenses. Money management is a crucial part of financial security. By budgeting carefully and lowering the amount you spend on day-to-day purchases, you may be able to pay off debt, regain your financial footing and put some money aside for the future.
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Things You'll Need
- A month's worth of receipts or bank statements
- A month's worth of household bills
- Calculator
Instructions
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Gather your bills, bank statements and financial records for the last month.
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Make a list of the various categories that you spend money on each month, such as groceries, other food, your mortgage or rent, utility bills, phone service and other expenses. Total the amount you spent last month in each category, using your bank statements, credit card statements and other bills. Place a notation beside categories where you feel you may be able to reduce spending.
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Add the totals of each category to find your overall expenses for the month. Then, divide this overall total in two. The result will give you the monthly expense figure to aim for as you work toward your goal of cutting your bills in half. You will likely not be able to cut each individual bill in half, but you can strive to do so with your total monthly expenses by trimming some bills and eliminating extras.
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Plan to save on your food budget. Most families can dramatically cut it by eating all meals at home and using inexpensive ingredients to prepare food.
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Look for ways to save on transportation. You may be able to save on gasoline by driving less, using public transportation or working to maintain your vehicle.
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Call your utility companies and ask for discounts or budget plans. These plans allow customers to average their utility bills over the course of a year, paying consistently each month and evening out seasonal trends. If your gas, water or power company has this type of arrangement, signing up may save you hundreds of dollars per year.
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Switch to less expensive plans or services wherever possible. Many phone and cable companies offer low-cost packages with basic channels or service. You may be able to save even more money on phone service by switching to a VOIP provider instead of a traditional landline service, or by using your cellphone exclusively. If you choose to use a cellphone, consider a prepaid phone with no contract instead of traditional contract-based plan.
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Evaluate your credit card and debt payments. If you are genuinely struggling to make these payments each month, you may be able to work with a nonprofit credit counseling agency to lower your monthly payments to a manageable amount. Check each agency you consider with the Better Business Bureau to ensure that it is reputable.
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Tips & Warnings
If you fall behind on a necessary bill, such as a utility or rent, check with local agencies and see if anyone can assist you.
