Cutting the budget clutter

We've been hacking into our budget, and reducing expenses lately.

On this blog, I don't tend to say a lot about my personal life, mainly because it's...well, personal. But with oil and food prices continuing to rise, we've been taking a good long look at what we spend and why.

We've been making some pretty drastic changes to tighten our budget. I thought I'd share some of them with you, and explain the reasoning behind them. Maybe they'll be useful to you, maybe not. If you have any useful and positive tips of your own, please share.

Food

We buy bulk for staples (rice, flour, dry goods), and buy tinned goods in bulk when on special. We keep a large food store which is regularly checked and rotated, and that also enables up to avoid buying when costs are high, and take advantage of discounts.

For fresh food, we eat locally and shop at the Farmer's Market for as much as possible of our weekly produce (eggs, tofu, cheese). We don't buy meat (our home is vegetarian), and that saves us huge amounts from a weekly shopping bill. At the supermarket, we buy what is in season, and avoid packaged and junk foods as much as possible - although a bit of ice-cream is always yummy!

Overall, we try to eat a fairly simple diet, and keep treats to being occasional rather than regular. I make cakes and biscuits, rather than buying them, and that saves money too. We also limit meals eaten out to once per week. Any more must come from personal spending money. Or from guests staying with us who treat us to takeaway curry!

Growing food

I have started my own potted garden. I am growing over a dozen types of food plants, and will be growing many more as the weather warms up and growing season begins. To set up the potted garden cost me less than $25 in total (including seeds, potting mix and cheap plant pots), and we expect to return $25 many times over in fresh produce from the garden.

The pots all fit into our bathroom/laundry, and on our fire escape and windowsill outside our main bedroom. We live in an apartment, but are just thinking as big as we can in our current space. We will also be growing some food trees from seed, figuring that by the time they are ready to transfer from pots we may have bought a home. If not, they have not cost us anything and we will sell them on Ebay for a tidy profit :-)

I think having a potted garden is also a cheap way to feel happy, and to entertain the kids. My son loves watering the beans. I just hope he doesn't kill them with love.

Personal spending money

We allocate a set cash allowance to my husband, to me, and to the kids (jointly) per week. This is dealt in cash, and covers: extra treats (e.g. if hubby wants to buy lunch or a coffee), all clothing except shoes, entertainment, cosmetics, luxury items, rentals (DVD hire, library fines etc.), and all non-essential purchases.

We found that this made a huge difference to our budget. Prior to the personal spending money cash allowance, we were spending huge amounts on the credit cards (just $20 here, $10 there), and although the cards were paid off every month, we weren't making any real progress with savings. The cash allowance scheme changed everything. Over the years we have significantly reduced the allowance per person. Nowadays I am allocated less per week than I received as pocket money from my parents as a teenager, but I seem to manage fine. I'm getting to love Op Shops.

Bills: Electricity, gas, water, rent

We do what we can to reduce our bills by standard fuel conservation methods, and we are also doing the Riot For Austerity, which has been fantastic for our budget.

However, being in a short-term rental has made reducing as much as we'd like difficult, as we have no control over such things as insulation, double-glazing etc. We didn't have much choice in fully furnished rentals (it was a choice of two suitable places), and the place we're in is huge and beautiful and impressive, but a bugger to heat. We hope to reduce our bills further once we move to our own home.

Bills: Phone, Mobile phones

Our home phone has a set-up where we have capped international calls. As most of our home phone calls are overseas (all our family are overseas) or local (local calls are free), this has saved us hundreds of dollars.

We moved to pre-paid phones, and slashed our mobile phone bills by more than 50%. By having a 'buddy' system, where calls to each other are free, we saw a huge difference in costs compared with a mobile plan. My mobile now costs me less than $10 per month.

Petrol

Petrol is becoming an increasingly large part of most people's budgets. Ugh. We're dealing with this in a few ways.

Hubby catches the bus to and from work when the weather is not foul - it takes him to the door. He's looking into, and will be testing, electric scooters, as a possibility for getting to and from work.

We also re-set the trip meter, and only buy petrol once per week. We plan trips, and monitor usage. Our petrol usage is also smaller than average by the fact that we moved to a small city where we live within 2 kilometers of the centre of town (quite walkable), and distances are correspondingly smaller. In short, we're driving less.

Living locally

Where we live now, everything is within walking distance. My husband's work is about 4 kms away. The children's playcentre is 800 metres away, and the supermarket is closer, with the chemist and local shops next to it. The Farmer's Market is down the hill, about two kilometers away. The furthest distance we regularly go is the Botanic Gardens, about 5 kilometers away.

On the weekend we went out to an outlying village for a sustainability expo. It was a long way away - 17 kilometers!

By living locally, we're supporting our own budgets, as well as those around us. If we support the services we need in our local area, those services will be there when we need them.

Conclusion

We're looking okay, but there is still a lot of room for improvement. We're very aware that when we buy our next home, the decision we make will prove critical.

• If we live close to services, we can save thousands per year on petrol and transport. We may not even need a car.
  
• If we have enough land, we can grow our own fruit and veggies, keep chooks and bees etc., and save money that way.
  
• If we buy a smaller home, insulate it well and double glaze, we will save hundreds of dollars on energy bills each year.
  
• If we live close to good schools, we don't have to pay for private education.
  
• If we buy energy-efficient appliances and put in compact lightglobes, we can save lots of energy.
  

Where we live makes as much of a difference as what we do when we live there, in budgeting.

We do have the power to change our situation, and to make it better for ourselves. It's just a matter of doing a bit (ok - a LOT!) of thinking, and coming up with some sensible answers.

We're doing allright, and saving a significant amount each month, so we're happy. But even so, I think it is wise to tighten more and live frugally. In some ways, I wish I didn't have to, but I'm trying to learn to live this way and deal with the old habits that I had, and learn the new habits instead. Some habits that have been useful include:

• I've become a library-lover. I now use bookshops as a catalogue. I go look, then make a note of what I see and like, and put it on hold at the library :-) I feel secretly very clever and pleased (and rather smug) with myself each time I do this, and sorry for the folk that are still buying books for themselves out of habit.
  
• I borrow DVDs. This has saved me HEAPS. I don't buy DVDs now at all, and if I really want one, I ask for it as a gift for my birthday or Christmas.
  
• The kids go to playcentre, and we haunt the Botanic Gardens. This saves us heaps in entry money to fee-paying kiddie activities. And the kids love it.
  
• I Op Shop. These days I find shop bought clothes rather...dull. Who wants to wear something that everyone else has?
  
• We have a roast on Saturdays. And clear out all the leftover veggies from the week before. Anything tastes good when it is roasted with rosemary! No waste is great!
  
• We don't buy snacks at the cinema. It sounds really obvious, but addicted as I am to cinema popcorn, I realised (finally!) it was pretty dumb to spend $16 on a movie ticket and $15 on a softdrink and popcorn. These days, I do without. Interestingly, although I could see twice as many movies with my money, there aren't twice as many decent movies to see...I cure my popcorn fetish with home-popped popcorn instead :-)
  
• I wear makeup and look nice when I shop. I realised that part of the reason I was wanting to buy clothes was because my self-image wasn't great. Some silly part of me thought that clothes would make me feel better, I guess. So these days when I go out shopping I make sure I look good and...guess what? I find I don't buy anything!
  
• I bring a water bottle with me everywhere. Plastic so-called 'disposable' water bottles are just lame. 'Nuff said.
  
• I eat before I shop. I know this trick has been listed again and again in magazines, but it really works! And I avoid the snack food aisles at the supermarket.
  

I hope this has been useful. Cheers.