Edited to say: Thank you very much for all of the insight and replies, and the mostly kind nature of your language (I expected harsher criticism, so thank you for being gentle!).Based on this discussion, I have put together the following goals and associated plans for achieving them in 2016:
Cut food budget down to 900/monthAnnual savings: $5,844Strategy will be cooking from scratch, choosing cheaper alternatives (i.e. oats instead of "puffins"), restricting restaurants to $80/month (one family meal and one date as a couple). Based on this online guide I think it is possible:
http://www.cnpp.usda.gov/sites/default/files/CostofFoodMar2015.pdfCut clothing budget down to $750/yearAnnual savings: $1850Strategy will be to shop at mom-to-mom consignment sales for the kids, and check out Salvation Army for me/husband. Us grown ups are set with most of what we need and will likely be able to spend little or nothing on ourselves this coming year.
Cut gardening budget down to $100/yearAnnual savings: $1,000Spending was high in 2015 due to the purchase of fruit trees, berry bushes, asparagus and rhubarb plants, along with starting new garden beds and renting a community garden plot. This year the only cost will be mulch/straw/soil, as we have everything else we need including seeds.
Cut Amazon.com and Misellaneous budgets in halfAnnual savings: $2458No big purchases earmarked for 2016 (unlike the bikes/swing set/computer upgrade in 2015) will take care of a lot of that. Also need to seriously consider purchases before making them, to determine if they are really and truly needed and if so, explore alternative buying/borrowing options first.
I also intend to be more frugal about family outings, packing cheaper food when we go camping, skipping the snack station at the water park, etc. With our new bikes husband and I have been able to enjoy dates without going to restaurants or movie theaters which has been helpful.
We will also carefully consider whether to invest our savings into Roth IRAs immediately or after we purchase our home in 2017. We are definitely intending to buy (after much, much research and discussion on whether to rent, buy, or rent for longer and buy later).
Thanks again everyone, I hope to report back here once I begin to see savings, and wouldn't it be lovely if my "case study" in December 2016 showed that I met the above goals? :)
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Life situation: We are a "Married Filing Jointly" single income family in the Midwest with a mother, father, and three children ages 1-7. We are a one car family, husband commutes to work via free bus while wife drives 25 miles a day bringing kids to school/running errands etc. We have no debt and are renting a house with hopes to become homeowners in 2017.
Deductions include FSA, Pension and Life Insurance. We have no other income sources or capital gains, etc.
Expenses below are actual totals for the year. We began the year with basically no savings, as we paid off our student loans and became debt free! Groceries and restaurants I am working on right now with strong intentions to reduce each! Gardening investments were for perennial foods such as fruit trees, berry bushes, asparagus and rhubarb plants (we are long term renters with intentions to buy this home from our agreeable landlord). Gardening in 2016 will be wayyyy less $$.
I "think" I did the adjusted gross income and income after taxes correctly...
Where else would you recommend working on to reduce spending? My guess would be miscellaneous, Amazon.com (random things like a white noise machine for the kids' room), and clothing. Otherwise how are we doing?
Gross Salary | $90,000 |
Deductions | $7,989 |
Adjusted Gross Income | $82,011 |
Taxes | $7,489 |
Income After Taxes | $74,522 |
Total Expenses | $62,780 |
Total Savings | $11,742 |
EXPENSES
Item | Annual $ | Monthly $ | % of income |
Rent | $19,500 | $1,625 | 26.2% |
Veterinarian | $491 | $41 | 0.7% |
Comcast | $725 | $60 | 1.0% |
DTE Energy | $1,632 | $136 | 2.2% |
Fuel | $1,500 | $125 | 2.0% |
Life/Rent/Car Insurance | $1,287 | $107 | 1.7% |
Cell (work pays part) | $156 | $13 | 0.2% |
Water Bill | $900 | $75 | 1.2% |
Gym Membership | $1,008 | $84 | 1.4% |
Groceries | $13,920 | $1,160 | 18.7% |
Restaurants | $2,724 | $227 | 3.7% |
Pets & Supplies | $320 | $27 | 0.4% |
Clothing | $2,600 | $217 | 3.5% |
Medical beyond FSA | $300 | $25 | 0.4% |
Amazon Subscribe & Save | $302 | $25 | 0.4% |
School Related Expenses | $365 | $30 | 0.5% |
Diapers/Wipes | $660 | $55 | 0.9% |
Hygiene Products | $690 | $58 | 0.9% |
Houshold (i.e. furniture) | $1,033 | $86 | 1.4% |
Gardening | $1,100 | $92 | 1.5% |
Entertainment | $100 | $8 | 0.1% |
Donations | $300 | $25 | 0.4% |
Family Outings | $700 | $58 | 0.9% |
Babysitter | $950 | $79 | 1.3% |
Pharmacy Stores | $1,051 | $88 | 1.4% |
Amazon.com | $2,354 | $196 | 3.2% |
Miscellaneous | $2,562 | $214 | 3.4% |
Auto Maint/Repair | $1,075 | $90 | 1.4% |
Gifts | $850 | $71 | 1.1% |
Vacations | $1,625 | $135 | 2.2% |
TOTAL EXPENSES | $62,780 | $5,232 | 84.2% |