Author Topic: Can't get my expenses down enough!  (Read 3712 times)

a.true

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Can't get my expenses down enough!
« on: April 15, 2015, 04:48:51 PM »
Newbie here.

I've gone over and over our budget, and I can't get our expenses any lower than 45K. We have a mortgage, we have a little credit card debt (yes I'm paying it off as fast as possible!) and then utilities and food and just basic living. Our problem is that our income after taxes is barely above our expenses, so we can't pound away at the debt the way we need to.

This blog sounds great- it really does- heck, I've been using a lot of these principles for a long time, simply out of necessity. Our grocery bill for 3 people is under $150 every week, we don't eat out, we don't buy stuff, we don't see movies, we don't take vacations (time away from work, can't afford it) we only ever buy used cars when we need to and buy Honda when we do so we can drive them for over a decade. We live too far away from things to bike to the store, etc. As of this week we both work from home, so there will be almost no driving. We live in a small house (1400 sq feet), we don't have tv- haven't for a decade- but we need internet/cell phones for work, and for mine I need a data plan, for work. I don't shop for clothes unless our daughter grows out of hers. We reuse, we recycle, all this stuff, and we have been for years now. It's a little frustrating to read this blog, he makes it sound so easy when it's just not realistic for some of us who never made enough money to put anything away or kill the debt- and before someone asks, the cc debt was a huge tax bill from years ago (when we were young and stupid and didn't know how to do them), medical bills (from having our daughter- we didn't understand how much was NOT covered by my insurance) and some big car emergencies from years ago.


Anyway it's frustrating. For us, I've taken a job where I can work from home most days and from now on I'm focusing on enjoying life now, whether we can save or not, because what little we can is not going to see us to retirement any time soon and frankly this blog is just upsetting. We just made too many mistakes along the way and we'll be paying for them, quite likely, for the rest of our lives.

Still love the blog though.



Kris

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Re: Can't get my expenses down enough!
« Reply #1 on: April 15, 2015, 04:51:51 PM »
Post a case study here.  I'm sure the good folks on the forum will find lots of things you haven't thought of:

http://forum.mrmoneymustache.com/ask-a-mustachian/how-to-write-a-'case-study'-topic/

JLee

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Re: Can't get my expenses down enough!
« Reply #2 on: April 15, 2015, 04:52:01 PM »
Can you write a case study? It may not be as hopeless as you think! :)

swick

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Re: Can't get my expenses down enough!
« Reply #3 on: April 15, 2015, 04:56:44 PM »
Welcome to the forums a.true

there are two sides to the FI coin - reducing expenses and raising your income. You might be as dialed in as you can go with reducing expenses (in which case, I hope you will stick around and share your knowledge and experiences) Is there any option to raise your income?

A case study would be a great idea...you basically have access to a whole collective of people with different knowledge/skills/experience that can make suggestions or give you a different way of thinking about things.  I learn something new every single day :)

jj20051

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Re: Can't get my expenses down enough!
« Reply #4 on: April 15, 2015, 05:01:13 PM »
Would moving closer be an option?

$600 per month for groceries for 3 people seems a tad high to be mustashian. The "thrift" plan for a family of 4 defined by the government is $567.00. My DW and I spend between $250 - $300 a month on food... I'd look into that see what you're paying for... see if you can buy in bulk.

kpd905

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Re: Can't get my expenses down enough!
« Reply #5 on: April 15, 2015, 07:08:45 PM »
Can you post all your expenses so we can help?  And $600 for groceries seems pretty high for 3 people.  We average about $320 for 2 people and I know we could improve that a lot.

possumjaw

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Re: Can't get my expenses down enough!
« Reply #6 on: April 16, 2015, 05:02:46 AM »
I think they mean it is $150/all three each month groceries...not $150 each?

kpd905

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Re: Can't get my expenses down enough!
« Reply #7 on: April 16, 2015, 05:55:13 AM »
I think they mean it is $150/all three each month groceries...not $150 each?

Yes, but that is still $600 a month which could be improved.

cerebus

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Re: Can't get my expenses down enough!
« Reply #8 on: April 16, 2015, 06:30:16 AM »
From what you're describing, it sounds like the only thing keeping your expenses at $45000 is the credit card debt plus I guess your house repayment. If you eliminated those from your income, what kind of impact would it make annually? The blog talks about a $25k budget but that's with no debt whatsoever.

It could also be that you live in a HCOL area where factors like rates and utilities are higher than average, and preventing you from cutting down. It's very hard to speculate though without a clear budget.

Ricky

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Re: Can't get my expenses down enough!
« Reply #9 on: April 16, 2015, 07:31:51 AM »
I'm sorry, but I hear a lot of complaining, immediately starting with the title. The correct answer is you CAN get your expenses down enough, but it takes time.

I don't know enough to speculate too much really. It does seem like you've accepted defeat and told yourself you're just going to accept a lower paying job with some at-home work even though it's not one that will help you meet your goals anytime soon. You've justified this decision by reasoning that the "now" is pretty good (and it sounds like it is). Yet, you're still complaining. You really can't have both, so you need to do something about it.

These two sentences stand out:

Quote from: a.true
It's a little frustrating to read this blog, he makes it sound so easy when it's just not realistic for some of us who never made enough money

Quote from: a.true
For us, I've taken a job where I can work from home most days and from now on I'm focusing on enjoying life now, whether we can save or not

Those kind of contradict one another. You can't make more money if you keep accepting low-paying jobs that are much less stressful and focused on lifestyle. It's not that you CAN'T make more money, it just doesn't sound like you're willing to right now.

It seems like you've got the whole Mustachian thing dialed down pretty well - small house, no cable/tv, modest or no vacations, used cars, etc...A lifestyle like that for 3 people without debt shouldn't be over $25-$35k even with the mortgage. Add the debt in, and yeah, you've hit the $45k mark.

By the way you describe your expenses:

Monthly -
Mortgage*: ($250k, includes insurance/taxes): $1,500
Food: $600
Utilities: $70
Gas: $150
Car Maintenance: $25
House Maintenance: $150
Internet: $60
Cell Phones**: $120
Clothes/Misc: $100
Debt repayment: $1,000

Total, Yearly: $45,300

Without Debt: $33,300 (And still many ways to reduce this!)
Without Debt or Mortgage: $19,500 (Beating the MMM family!)

All hope is not lost. There are ways out of this. You just need the right attitude and to gain whatever knowledge you lacked before so you can use it in the future. A big part of being FI is haven't a paid off home or having enough invested to cover rent, so you're money isn't being wasted. As long a the debt numbers are accurate, you have nothing to beat yourself over about how you're spending money. There is maybe only a little room for improvement, but nothing that I think would justify it. You're well on your way, overall, it's just going to take longer if you don't get your income up.

*Huge guess, but probably not too far off? Modest home in a HCOL area.
**This could vary wildly, but I think this is average for those that haven't toned down this cost yet.
« Last Edit: April 16, 2015, 08:00:36 AM by Ricky »