Case Study: Ready for a Change of Everything in my Spending/Saving

[laughingmanzero]

Income

Main Job (9-5)
Gross:
$48,000/yr
$4,000/mo
Net:
$33,800/yr
$2,800/mo
 
Side Income
Gross:
$28,000/yr
$2,330/mo
Net (approx.):
$22,000/yr
$1,830/mo

*Contract based side income at $2000/month; variable side projects average about $4,000/yr.

Total Income
Gross:
$76,000/year

Net (approx.):
$55,800/year
$4,650/month


Current Expenses

3-Month Average
$4,010/month

3-Month High
$4,672

3-Month Low
$3,600

Last Month
$3,600.00

Breakdown - Fixed
$1,050/mo – Rent
$250/mo – Verizon Cell Phone (This is due to me being far too generous with family in the past, 1 line is my brother, 1 line is my dad, 1 is mine, contract ends in 2 months, and then I can kick them off and get different provider for just myself at MUCH cheaper cost)
$150/mo – Credit Card Bill #1 (Furniture Payoff - 0% interest – 24 mo., utilizing this to rebuild credit, minimum payment is $70)
$100/mo – Internet/TV
$100/mo – Secured Loan Payment (Local credit union, 1.5%, utilizing this to rebuild credit, minimum payment is $80)
$75 - Student Loan 1 ($3,300, 5.75%, min. $44)
$50 - Student Loan 2 ($2,000, 6.55%, min. $28)
$70/mo – Electric Bill (Very Consistent)
$30/mo – Gas
$24/mo – Trash/Water (Same bill)

$750/mo – Secured Credit Card Payoff (I put all fixed expenses on this every month and payoff entirely the next month, 0% interest, using this to rebuild credit. $750 is 25% of my $3000 limit that I secured this with)

Side Business Expenses - Fixed
$175/mo

I don't really have variables with this, any business expenses are reimbursed almost immediately. I set this company up to run on very low costs without unforeseen emergencies. No loans/credit cards or anything of that sort yet.

Fixed Expenses Total
$1,900 + $750 secured CC payoff from previous month + $175 side business expenses
$2,825 Total

Breakdown – Variable – Avg. from 3-Month
$400/mo - Restaurants
$150/mo - Fast Food
$125/mo – Groceries
$250/mo –Entertainment (Varies: fishing, drinking with friends, etc., aside from food, this will be my other major area of improvement, average is skewed by $80 due to keg purchase for a wedding last month)
$140/mo – Cigarettes (they kill my body and wallet!)
$65/mo – Dog Food/Treats (Great Dane, he’s a hungry boy)
$45/mo – Gas

Variable Expenses Total – Avg. from 3-Month
$1,175/mo


Assets
$5,000 – Cash from side business income – sitting in savings account doing nothing while I figure all of this out
$3,500 – Motorcycle – Paid off back at purchase date in 2006, use this for commuting; value based on current rates in my area for this same motorcycle, no plans to sell as long as I maintain it well enough, hard to beat 50mpg and not having to deal with traffic

Liabilities - $9,600 Total Owed

Student Loan 1 - $3,300, 5.75%, min. payment $44)
Student Loan 2 - $2,000, 6.55%, min. payment $28)
Secured Loan -    $2,700 secured in share certificate, amount owed $2,000, 1.5%, min payment $80
Credit Card #1 - $2,300, 0%*, min. payment $84  (*as long as payments on time, 18.99% if late, I won’t be late)
Secured Credit Card #2? - $3,000 secured credit card – I spend $750 every month to cover fixed expenses, 0% interest since I pay it off before the 25-day grace period, 13.9% if I pay after grace period. I’m never late, I learned my lesson from screwing up so bad with credit when I was younger. Not sure if I should’ve included this or not.


Questions/Goals
How best to lower expenses? I know (and cry myself to sleep over this) that my biggest area of concern right now is entertainment and food. Ways to improve the habit? Ideas on how to stick to the improved spending habits?

Notes: I have a Costco card, crockpot, oven, microwave, and a good full kitchen that I just simply don’t use. I am wasting what is available to me. This is where I know I can improve my health and wallet the most. Succeeding at this is the biggest hurdle to overcome. Any tips or guidance on how to go about this is greatly appreciated.

Pay off student loans or leave them going to continue rebuilding credit?

Pay off Credit Card 1? Or continue paying $100/mo at 0% interest for the next 23 months in order to build credit?

I personally believe keeping at what I’m doing with the secured credit card #2 is my best bet, until my credit is back into the 650+ range where I can then look at regular credit cards and free up that secured money for other uses.

After choosing what to do with current debts, and fixing current expenses, what is the best option for beginning investments? I recognize that I have a problem where when I see money in my checking account, I feel more willing to spend the money, so I’d like to lock the money I don’t need away in some type of investments where I can’t touch it until I become more Mustachian, or FI. I have to hide myself, from myself, in other words. What are the best options for this?

I am considering a first home purchase 2 years from now, if things look right at that time in the market; this is motivated by not wanting to pay so much in rent every month to something that does nothing for me in the long run except that whole "roof over my head" thing :P Should this be an option? I would be trying to find something in the $150-300k range, however, it is exceptionally difficult to do so in my area. I live in Southern California in the Orange County area so cost of living is high. It is difficult to find cheap rent, and even more so to find a house cheap enough to buy that isn't falling in upon itself in repair costs. Most homes out here are 40+ years old. I've considered a mobile/manufactured home as I can find those for about $250-300k but, I am still studying the future prospects I would have out of something like that as far as appreciation/depreciation are concerned. Still learning after all :)

Supplementary: Financial Portrait
I am a man that likes to be optimistic about the path ahead, and I also like to reflect on what I’ve done wrong. Here are some numbers from the past that will make any true Mustachian on this forum pass out from anger. Please pay attention though as these numbers may be able to help paint a picture for future growth.

I am 25. I do not have data for the years before 2010, you could say I was going through my young exploratory years finding myself and what not. The financials for those years would have been worse than or equal to 2011, so there’s not much to discuss or pick at there.

Annual Income:
2011: $14,112.12 – Baseline (First year data was collected through Mint; previous years were <= this amount)
2012: 68% increase over previous year $23,727.76
2013: 57% increase over previous year $37,385.13
2014: 101% increase over previous year $75,235.02*
2015: Can't see into the future, can we? Realistically, I can expect at least a 10% increase due to main job raise and increase in side venture income as I slowly hone in on exactly what I want to target my career towards and how I want to proceed with either my main job or side business.

*Number based on total income from 1/2014 - 7/2014 plus projected income from stable main job income plus side ventures; current income as of 7/23/14 is $37,735.00

Here’s the faint-y part…

From 02/2011 – 07/2014
Income: $112,960
Expense: -$102,105.89
Net: $10,854.14

Sad.

When I saw these numbers, I realized that I have just been ignorant of my own habits and that everything needs to change. That is why I am so excited to have found you Mustachians, and cannot wait to make a complete change to my finances. Please help, and let the punching commence.

[4alpacas]

Get ready for a few face punches. 

First, I want to congratulate you for facing the issues head on.  Now to the unfun part:

Cell phone:  You've got a plan and an escape date (2 months).  Read I.P. Daley's blog (http://www.techmeshugana.com/theguide/) to be ready to strike as soon as you're out of your contract.  He's SO helpful.  I recently switched to Ting with his help. 

Internet/TV:  Cut it to just internet.  Savings: $50

Food:  $675 REALLY?!  You're spending $550 eating out!  Stop eating out.  Pack snacks.  Start cooking.  My favorite website is Budget Bytes (budgetbytes.com).  I also recently stumbled across this cookbook https://8e81c55f4ebf03323905b57bf395473796067508.googledrive.com/host/0B2A2SnkA9YgxaHdzbEhGSmJOZDg/good-and-cheap.pdf 

Entertainment:  You already said you're going to work on it, so I'll hold my punches.

Cigarettes:  Stop.  Now.  You'll save $140/month now and thousands of dollars in the future. 

I estimated that you could cut over $1k from your monthly budget without much pain.  Good luck!

[Gimesalot]

As far as "locking up money," if you are planning on buying a house in 2 to 3 years, you can use a savings account.  There are several online options (capital one, ally, smartypig, etc.)

Remember that paying interest does not necessarily build more credit than paying off a loan.  Don't have money borrowed if you don't need it.  Use cerditkarma.com to figure out your current score and run some simulations about how to increase your score.

[Frankies Girl]

Hi and welcome. :)

Just kill the fast food and cigarettes. Both are horrible for you and costing you right under $300 a month. $3,500 a year. Just stop as soon as possible. I know how hard it is to quit smoking... I've been a quitter many times, but it is totally worth it.

Your food/entertainment budges are insane. Seriously. As long as I had debt, there would be NO eating out or entertainment expenses. There are way more things to do entertainment wise that won't cost you hundreds of dollars a month - movie night, go play a sport with friends at the park, free/cheap concerts... check out your town or city's activities to see what is going on out there and you may be surprised if you happen to live in a moderately decent area. Fishing is expensive? Seriously? I have been fishing... if you already own your own tackle, what is the expense other than maybe (?) live bait. And "drinking with friends" can be pretty easy to reduce spending as long as you aren't hanging out in a bar all the time. Or alcoholic.

You can learn to cook tasty and cheap meals - I also love budgetbytes.com and also search around this forum as we've had many posts regarding cheap eats. Take your lunch to work too.

Cable? Sigh. 99% of the stuff on cable is available through the internet now. The other 1% (mostly sports stuff that is live) will be on there in a short time. Cut it out.

See if you can get out of your contract early on the cell phone, but at the very least, be ready to go the instant the contract is up. Republic Wireless or Ting are both great options, but check out the link 4alpacas posted. I think they both might have ETF payback options as well (Ting will pay you up to $75 to break your contract). And hopefully you'll only be paying for yourself and not your brother/father.


Do you have a 401k at work? If so, are you kicking anything into it?


If it was me, I'd be throwing everything I had at that debt. It isn't as bad as I've seen on here, but you've got some high interest loans, and carrying a credit card balance is a fool's errand even if it is zero percent now, the least little mistake and you're screwed. I would make sure to have around $3K in savings as an emergency fund, and then take the $2K and pay off the higher interest loan. Make the minimums on the rest. Then take the monthly surplus and hit the second highest interest loan and get that knocked out in a few months and then hit the credit card and the secured loan. And then I'd only ever use a credit card for purchases that could be paid in full each month - never carry a balance on a credit card again if humanly possible! Your credit should also be getting better (depends on how crappy you're having to come back from) but you should be checking around once a year and when you start getting into decent rating territory, start looking for a rewards credit card that has a lower APR to use as your everyday - and still promise yourself to never ever ever let it carry a balance. ;)


If you reduced your spending and hit the loans/CC debt hard, you could have all of it paid off in under a year. And do make sure to check all of your options for work-related tax-deferred investing, and start funding a Roth or traditional IRA (not sure which would be best in your situation). If you have a 401k with matching, I'd make sure to hit the minimum to get that match, and then follow the rest of the stuff I outlined.

[surfhb]

It's not very Mustachian but, at the very least, start vaping instead of smoking.   

If you continue to smoke and eat fast food you WILL die an early and unpleasant death.   

Beyond that, I see about $700 a month wasted on stupid crap.    Been there done that too my friend :)

[Jack]

Cigarettes:  Stop.  Now.  You'll save $140/month now and thousands of dollars in the future. 

And by "in the future," 4alpacas means just over 7 months from now because that's how quickly your $140/month habit will accrue to $1K. Wasting a THOUSAND dollars in only 7 months!!!!! WTF!

I don't even need to facepunch you for that; the cigarettes are punching you in the lungs for me!

Your $125/month grocery budget should be your total food budget. Quit eating out.

For entertainment, do more fishing and less drinking (or at least do your drinking while fishing; that's cheaper than going to a bar).

Cable TV and cellular phone service are not "fixed" expenses.

What's your side business, by the way?

[CestMoi]

I agree with other posters regarding the cigarettes, fast food, and restaurants.

Do you eat at restaurants for everyday meals for yourself, or is it a social thing where you meet friends regularly? If it's to feed yourself, start cooking at home instead. If it's a social thing, try reducing it to $150 per month to start. Become more aware of what you spend out with friends there, and in your Entertainment category.

With these changes, you can save between $540 and $690 per month, or more. Put that toward an emergency fund and then your debt.

If you don't get into cooking every night, find some recipes you really like and cook yourself a big batch over the weekend. Take it to work for lunch during the week.

As an ex-smoker, I know how difficult it is to quit, but it can be done. Read some online articles about the effects of smoking on the body. You're still young enough to reverse some of the physical damage.

"Quitting smoking is easy. I've done it thousands of times." - Mark Twain

[laughingmanzero]

Cigarettes:  Stop.  Now.  You'll save $140/month now and thousands of dollars in the future. 

And by "in the future," 4alpacas means just over 7 months from now because that's how quickly your $140/month habit will accrue to $1K. Wasting a THOUSAND dollars in only 7 months!!!!! WTF!

I don't even need to facepunch you for that; the cigarettes are punching you in the lungs for me!

Your $125/month grocery budget should be your total food budget. Quit eating out.

For entertainment, do more fishing and less drinking (or at least do your drinking while fishing; that's cheaper than going to a bar).

Cable TV and cellular phone service are not "fixed" expenses.

What's your side business, by the way?

Thank you for the insanely fast response times! :)

Jack, I'm in IT. I work as a systems admin at my main job, and then consult out to clients on the side doing the same. The clients I work a total of 5-10 hours per week and earn the contract amount of 2000/mo. I also contract out to a few airlines in San Diego about 3 times a year for side work when they need me. I'd make a lot more off of these jobs but I typically have to hire one or two guys to help with the work as these are bigger 24-hour straight type jobs. I'm going to proceed with this arrangement for another year or so, and see which route offers me more success (9-5 or my business).

I spent the last hour checking out the links you guys provided and reading into some more of the FAQ/Getting started guide on here and all of its links. These are great resources to get started with. I'll put some things together and figure out a budget for a costco run this weekend. I know that if I can really succeed with eating at home and taking food to work, I will be able to take out large portions of my current expenses and stop crying at night about how helpless I am (I'm not, I'm just doing this to myself) :P

Smoking: Honestly, today was the first time I looked at what I spend on cigarettes. I just about fell over in my chair when I saw the amount.  It's going to be a huge thing to overcome, but I know if I can stop that, I'll have a nice little chunk shaved off my annual expenses. I'll have to refocus my efforts to quitting if I want to make any real progress both for the health aspect and the money aspect.

Phones: I'll only be paying for myself after the contract expires. I am working on a plan for this once my contract is up. My work, and passion, is in IT and networking, so if all goes well and my planning develops something reliable enough, I should have a system that costs me $1/mo for the phone number, $10/mo for a 1GB data connection to major providers, and some piggybacking off of my own business' phone system which costs me $25/mo to run. The total cost for my personal cell phone will be just $11/mo with full access to major provider networks since my calling will be going over the internet instead of the voice connection and up to 1GB of data with no overage charges, just speed throttling. I'll always have phone service as long as a cell tower or WiFI is nearby and it'll only cost me $10/mo without a contract.

401k: Nothing at work yet. I've been asking them for months now as they keep saying they'll be rolling it out soon. I will contribute whatever they will match and then some.

Entertainment: I'm thinking as someone suggested, to basically look for close-by events that me and my significant other (SO) can go to. We both are very tired of spending so much going out and are more inclined to just start reading books instead and watching movies at home through netflix or something. The reason fishing costs so much is due to going out on the boat with the friends. We do infrequently, but it is typically $50 for a full day of fishing. It adds up when you do it enough. This is something I have no problem saying no to for the mid-term while I get my house in order, so to speak, or if it happens only once or twice a year.

Do you have a 401k at work? If so, are you kicking anything into it?


If it was me, I'd be throwing everything I had at that debt. It isn't as bad as I've seen on here, but you've got some high interest loans, and carrying a credit card balance is a fool's errand even if it is zero percent now, the least little mistake and you're screwed. I would make sure to have around $3K in savings as an emergency fund, and then take the $2K and pay off the higher interest loan. Make the minimums on the rest. Then take the monthly surplus and hit the second highest interest loan and get that knocked out in a few months and then hit the credit card and the secured loan. And then I'd only ever use a credit card for purchases that could be paid in full each month - never carry a balance on a credit card again if humanly possible!

If you reduced your spending and hit the loans/CC debt hard, you could have all of it paid off in under a year. And do make sure to check all of your options for work-related tax-deferred investing, and start funding a Roth or traditional IRA (not sure which would be best in your situation). If you have a 401k with matching, I'd make sure to hit the minimum to get that match, and then follow the rest of the stuff I outlined.

Frankies Girl,

I think you are right in regards to the debt. I will take 2k out of my 5k and pay off the higher interest loan immediately. It won't hurt me as I have a large amount of invoices being paid in the course of the next 3 weeks totalling 6k. I just have to be careful to not spend all of it as I always need to set some aside for tax season. I will then work out a budget for working down the list and having zero debt. Due to the credit situation I've been having to finance some things on secured options just to rebuild up to a solid point, another 6-9 months should be enough to get me back into the 650-700 range though.

Would you be able to expand on the "work-related tax-deferred investing"? I'm going to be spending the next few weeks researching everything I can find on these forums in relation to how to put aside my money but I have to say, as a newcomer, it is very overwhelming.

Thank you for the face punches, as odd as it is to say that. They hurt, but I've gotten good at getting back up again when I fall.

[laughingmanzero]

I agree with other posters regarding the cigarettes, fast food, and restaurants.

Do you eat at restaurants for everyday meals for yourself, or is it a social thing where you meet friends regularly? If it's to feed yourself, start cooking at home instead. If it's a social thing, try reducing it to $150 per month to start. Become more aware of what you spend out with friends there, and in your Entertainment category.

With these changes, you can save between $540 and $690 per month, or more. Put that toward an emergency fund and then your debt.

If you don't get into cooking every night, find some recipes you really like and cook yourself a big batch over the weekend. Take it to work for lunch during the week.

As an ex-smoker, I know how difficult it is to quit, but it can be done. Read some online articles about the effects of smoking on the body. You're still young enough to reverse some of the physical damage.

"Quitting smoking is easy. I've done it thousands of times." - Mark Twain

Me and my significant other, live, work, and spend most of our free time together. We have developed the very nasty habit of going out for fast food or quick lunches when at work every day. When we get home, sometimes we will cook, but sadly, the majority of the time it is fast food or something cheap. This adds up to a LARGE amount since you can think of it as paying for 2 people every time one of us buys. We keep it very even where each of us switches off, but still, that makes it only more terrifying knowing that the budget that I put up there is only half because my SO is buying the other half of meals.

This is the biggest thing we need to combat as a couple. We have the materials to cook and make smoothies at home, so now we just need to force ourselves to do so until it becomes second nature. Budgetbytes.com looks like it will be an amazing aid with this.

The other problem with quitting smoking, is that I believe I'll be able to, for health and financial reasons, but my SO will continue to do so. It is her one vice that I can't seem to help her stop. This will make it difficult for me, but I'm always able to find a way.

[Frankies Girl]

Do you have a 401k at work? If so, are you kicking anything into it?


If it was me, I'd be throwing everything I had at that debt. It isn't as bad as I've seen on here, but you've got some high interest loans, and carrying a credit card balance is a fool's errand even if it is zero percent now, the least little mistake and you're screwed. I would make sure to have around $3K in savings as an emergency fund, and then take the $2K and pay off the higher interest loan. Make the minimums on the rest. Then take the monthly surplus and hit the second highest interest loan and get that knocked out in a few months and then hit the credit card and the secured loan. And then I'd only ever use a credit card for purchases that could be paid in full each month - never carry a balance on a credit card again if humanly possible!

If you reduced your spending and hit the loans/CC debt hard, you could have all of it paid off in under a year. And do make sure to check all of your options for work-related tax-deferred investing, and start funding a Roth or traditional IRA (not sure which would be best in your situation). If you have a 401k with matching, I'd make sure to hit the minimum to get that match, and then follow the rest of the stuff I outlined.

Frankies Girl,

I think you are right in regards to the debt. I will take 2k out of my 5k and pay off the higher interest loan immediately. It won't hurt me as I have a large amount of invoices being paid in the course of the next 3 weeks totalling 6k. I just have to be careful to not spend all of it as I always need to set some aside for tax season. I will then work out a budget for working down the list and having zero debt. Due to the credit situation I've been having to finance some things on secured options just to rebuild up to a solid point, another 6-9 months should be enough to get me back into the 650-700 range though.

Would you be able to expand on the "work-related tax-deferred investing"? I'm going to be spending the next few weeks researching everything I can find on these forums in relation to how to put aside my money but I have to say, as a newcomer, it is very overwhelming.

Do some research (and wouldn't hurt to ask on here in a more specific post) about solo 401k options. As you make a decent amount of income from a side business, as the business owner, you should be able to open and fund a large amount of tax deferred money into this and since you can decide where and what funds, it should be a super option to get into investing when you get going... especially since you don't currently have any tax deferred investing/retirement accounts at your 9-5 job. (I'm by no means an expert on this, so definitely do the research on if you qualify!)

Otherwise, Roth IRAs are open to anyone that earns income under certain limits. $5,500 per year, after tax and you can open them anywhere (like Vanguard).

But in this case, it would be best to get the debt killed off first. Good luck!

[Another Reader]

If you quit and your SO does not, one of two things will likely happen.  You will go back to smoking, or you will break up.  Everyone I know that has quit permanently and their partner has not, split up.  Usually it's things like the smoke smell everywhere (including on the person) the frequent need to smoke, and the cost.  Being with an addict of any kind when you have beaten the same addiction is extremely difficult.  In your shoes, I would try to work with her on quitting together.

[Joy]

If you haven't read it already, I would recommend reading the book Allan Carr's Easyway to Stop Smoking. I was able to kick a ten year smoking addiction after reading the book (ten years ago). My sister and two of my roommates also quit smoking after reading the book.  There are a ton of positive reviews online.  You could check to see if your local library carries it.

Good luck with reducing your food costs!  I am also a huge fan of budget bytes.  I find that making big batches of our favorite things such as: lasange, chicken enchiladas and lentil soup with rice keeps us from buying takeout. I enjoy being able to  just grab something from the fridge and heat it up faster than it would take to stop and pick something up. I also love making meals in the slow cooker.

[Thegoblinchief]

Another way to go about it is to figure out what you like the most at restaurants, then learn how to make the same stuff at home.

Make simple, cheap meals most days, but on a weekend when you're not as stressed, take your time and learn a new recipe each week. Within a few months you'll have a huge repertoire of meals.

Recipes can be a great way to learn how to cook, but consider also learning simple techniques like stir frying, sauteeing, and grilling. Buy what's on sale, then use one of those techniques and simple seasoning (often salt and pepper are all in-season produce needs to shine) to make your meals.

I find relying too much on recipes to be a big of a spending trap, where I'd be buying stuff that was either expensive or I never used afterwards.

[kallinan]

Good job facing your issues head on.  I'll reiterate what most other have said:  cigarettes & fast food of course.  And of course get the SO on board first - big life changes should be made together if they're worth keeping.

But I don't fully understand what Credit Card #2 is about.  You have $1,900 in fixed expenses... so where's that $750/mo coming from?

So my suggestions, similar to others:

• Cigarettes.  Obviously.  $140/mo.
• Restaurants & Fast Food.  You can cut it down without removing it.  1-2x week (total, no cheating and doing 1-2 lunches & 1-2 dinners) can be enough to have a little fun while not killing your budget.  Savings could easily be $400/mo, but you'll need to cook more.  So let's say real savings of $250/mo.
• Entertainment.  Same thing.  I'm sure you could cut your entertainment budget in half with relative ease.  $125/mo.
• Cell Phone.  You could easily get down to $20-25/mo before you get your long term solution up.  Just stop paying the $250/mo.  That's $225/mo savings.
• TV.  It's for suckers.  Really.  A couple hours a week is fine, anything more and there's better stuff you can do with your time.  $50/mo.

So now that your expenses will be lower - if you did everything on this list, that's $790/mo.  Wow.  I'd go after Credit Card #1.  Credit Card balances suck.  Once that is done, go after you highest interest loan.  That will be gone in months.  Then your second student loan.  Within a year you could be saving nearly $1,000/mo.  If your SO did something similar, you'd both be sitting pretty and have taken some enormous steps towards FIRE.

But how, you had asked -  well, I can't help with cigarettes.  But food & entertainment, I can.

For food, it sounds archaic & boring, but make a list of what meals you'll make for the week.  That way you're forcing yourself to make these items or have the food spoil - I know that's a powerful motivator for us.  Also remember to plan for lunches - either with snacks, sandwiches, or even leftovers you can re-heat.

Entertainment - Netflix, books, and exercise such as cycling, hiking, or even just walking is extremely rewarding and all very low cost.  Yeah, you can still do the occasional big expensive outing, but you can have plenty of fun with free options.  Are there festivals in town?  How about free museums?  Big, awesome parks?

Here's an example of my wife & I.  We live in Buffalo, NY.  That's where the NY State Barge (Erie) Canal starts.   Goes all the way to Albany, NY.  Turns out they took the old canal towpath and turned it into a bike trail.  We can literally ride from our front door 90+ miles east to Rochester, NY (and further, if we wanted).  So last year we decided to do this with an easy, 2-day cycling tour.  We bought some cheap panniers ($40), ate out for dinner both nights ($60?), and stayed at a hotel ($100).  $200.  Extravagant to us.  But the thing is, we had to train.  For a whole month before, our weekends were going on increasingly long bike rides so we could survive the first day's 60 miles.   So it wasn't $200 for two days - that was the excuse that made us spend half a summer on our bikes.

Best of luck!

[davef]

Quit smoking.
Fix your phone bill.
Drink at your house or buddies houses to save $ (I understand the bar scene has its other benefits) Cut down your drinking  (limit yourself to a couple nights a week)
teach yourself to cook and eat at home more. Loose the fast food, Roadkill is better for you.
I would never reccomend ditching a pet, but they are rediculously expsensive. I plan to not get another dog when mine passes.Including vet bills I spend about 1800/year averaged over 5 years on my foxhound.
Consider saving up a down payment over the next two years and moving somewhere not so expensive.