A Balanced Approach to Cutting Back

February 22, 2023

As a financial planner, I enjoy listening to other financial planners. I love when they discuss strategies to help people get out of debt and better manage their money. Although I agree with many of the money management strategies, it strikes me that some approaches are extreme. Additionally, many common strategies have little room for a more balanced approach.

For those knee-deep in a financial crisis, I agree that drastic financial cutbacks are needed to climb out of an emergency. There may be a better approach for others not in crisis but need ways to save and pay off debt. I always tell people to gauge what strategy will keep them consistent in paying off debts and saving more. The more extreme you cut back, the quicker you will reach your goals. However, you can still reach your goals and enjoy some of the extras in life with a little modification:

Cable and Streaming Services

I do agree that cable is a want, not a need. However, perhaps watching football or the Real Housewives of “insert city here” is one of the joys in your life. In that case, consider reducing your cable plan to a cheaper streaming service covering your most watched channels. Better yet, look at cable alternatives such as Sling TV or Playstation Vue, where you can watch your favorite cable channel shows in real time. Or rotate your “extra” streaming services so you’re constantly binging the hottest show.

Eating out

Again, if you are in a financial crisis and are seriously behind on your bills, you may have to eliminate eating out. However, if this isn’t the case, and you can’t seem to stop eating out, consider simply cutting back. If you spend an average of $20 eating out and cut it 2x weekly, that’s $40 a week, $160 a month that can go towards saving for emergencies or paying down debt. If you have a typical weekday at work that you work longer or a day where your kids have a lot of after-school activities, you could make those eating-out days (give yourself a budget) and still save towards your financial goals.

Entertainment

Consider some modifications if you are single and going out is your main social activity. For example, you can order an appetizer or a small salad if you eat before going out with friends. Your wallet will thank you. Better yet, skipping drinks with your meal or having only one cocktail with your friends can save even more money.

If you enjoy going to movies, check to see if your employer offers movie ticket discounts. Look for deals using websites like Groupon or Living Social, or search for dollar movies in your area. If you go to a big event, consider either not buying food since it is so expensive or getting the kids’ options, which are cheaper but still give you your food fix.

Cutting back doesn’t have to mean extreme deprivation. As you can see, you can still enjoy your life and save money. The key is looking for certain areas to cut back in and modifying the areas that matter most to you so you can save money with a more balanced approach.

15 minutes Could Save You $150

May 19, 2016

My colleague Tania Brown recently wrote a blog post about cutting her cable cord. It’s something I did many years ago too and never regretted it. If you’re not willing to go quite that far but still want to save some money on your cable bill, another colleague and former Financial Finesse blogger Greg Ward writes about how to negotiate your bill down…

When it comes to in-home entertainment, you have a lot of choices. Phone, television, and Internet services are available through a countless number of providers, but here’s something you may not have thought about. By having so many options, you can have these service providers compete for your business rather than just accepting what they charge you for their programming. Knowing this, here’s an easy way for you to save $150 or more over the next six months.

Contact your in-home entertainment provider right now and ask them what specials they are offering new subscribers. Unless you have recently subscribed yourself, I’ll bet that what they are offering new subscribers is better, either price-wise or programming-wise, than what you are getting today. If that is the case, then you need to be assertive and tell them that you want the same privileges that they are giving new subscribers. In other words, you want more service or a lower price (or both as the case may be).

Now most likely two things will happen. The first is that they will try to accommodate you by offering a different programming package. If you are really looking for a different programming package then hear them out, but if not, hold your ground. Let them know that unless they are willing to work with you, you are willing to work with someone else (i.e., a different provider). Have a few names of other providers that your provider competes with so that they know that you’ve done your homework.

Once you’ve determined that the first operator is not going to be much help, you’ll most likely have to talk with an “account specialist” to see if they might be able to do something for you. That’s good news, because in most cases, the initial person who answers the phone is NOT able to make any concessions. Once you have the account specialist on the phone, you can calmly let them know of your intention to discontinue service in the absence of reaching an agreement. They will also try to accommodate you through other offers, but stand firm.

My experience has been that they WILL make a concession as long as you are kind and persistent. I did this recently, and the specialist was able to apply a $25 discount to my bill for the next six months. That’s $150 in just 15 minutes!

A word of caution: know your other options. Account specialists usually know what their competitors are offering, so if you are going to suggest that you will terminate service if they are not willing to work with you, be prepared to walk.  Hopefully it doesn’t come to that.

5 New Year’s Resolutions You May Not Have Thought Of

January 10, 2013

With 2013 officially upon us, it’s time to put on your thinking cap and create some quality resolutions. The national economy might be unstable, but you can still have a banner year. Strive to improve your finances as much as possible and you’ll be off to a good start. Continue reading “5 New Year’s Resolutions You May Not Have Thought Of”

How to Lower Your Bills

August 25, 2011

One of the great things about your 401(k) is that it allows you to put away a small amount of money each month and end up saving quite a bit of money over time. The “fixed” expenses I’ll write about in this post work the same way, except in reverse. While they individually aren’t as big an expense in most people’s budgets as the housing and transportation costs discussed earlier, these relatively small costs can still add up to a lot of lost savings each month: Continue reading “How to Lower Your Bills”