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s/o Oprah thread--frugality for the high income crowd - Page 2

post #21 of 141
Why don't you decide that you're going to knuckle down until your credit card and your car is paid off, and then you'll be able to start eating out again?
post #22 of 141
The absolute, most helpful thing that we did for our budget was to start paying CASH. I love the feel of having cash, and it's an absolute. When it's gone, it's gone.

FWIW, we used to waste money like nobody's business pre-kids in the early days of our marriage. Thus the debt accumulation (not all CC, some was a motorcycle and a car). When I look back now, my huge regret is wasting so much money on eating out and craft supplies that I never used.

I still sew and quilt and scrapbook, but at a much more reasonable level. Hope this helps!
post #23 of 141
We have a fairly high income, but live in a VERY high cost of living area. Yet we don't go into debt. Looking at your list, here some stuff we *don't* spend on:

No cable. No tv. No commercials telling us to buy stuff
Our internet is much cheaper. Can you find a better deal? Or even call and get them to lower it for you? Tell them you're going to switch providers if they don't...
No real eating out (dd's sensitive to everything) but we buy organic and local whole foods and cook some fancy stuff at home
not much shopping. In my family we say I didn't get the 'shopping gene.' But I am enjoying spending on things I *really* like and that will last a long time. For that reason alone, I avoid target and prefer to shop at craft faires.
I've been trying to work through my stash of craft supplies and only buy new with a specific project in mind *that I'm ready to start working on*

Also, you really are paying down the credit card, fast. Once that's gone, you'll have a lot more money to save and the deficit will go away.
post #24 of 141
We have a good income too, and while we are not in debt I sympathize with the OP because its so easy to let the little things slip if you have some cushion. Our weekly Starbucks trip, which we really enjoyed and looked forward to all week as time spent together enjoying coffee and conversation, started turning into an every other day Starbucks trip until we made a conscious effort to nip it in the bud.

Quote:
Originally Posted by grlpowers View Post

You really are not doing too bad but you might want to stay out of target for a little while. That was quite a high bill for a month, ya know?
I absolutely agree with this. Staying out of stores, and especially places like Target have been my number one money saver. Somehow there always seem to be things I "need" or things that are "too good to pass up." Even thrift stores can be dangerous.

What I do now is keep a list of things I actually need or want and write a target price. For instance I inventoried my son's clothing and found that I have tons of 2T pants (his current size), but no 3T. Since I have a year before he gets to 3T I set a maximum price of $1 per item of used children's clothing, or $2 if new or name brand. For anything beyond 3T I won't spend anything more than a $1 and it has to be perfect since I will likely have time to find petter stuff. So I write on the list:

3T pants, $1 used. $2 really nice.
4T+, $1 really nice.

So when I go shopping at the thrift store or yard sales I don't even look at the 2T, and only buy 3T or bigger if its a fantastic deal. I have more of a goal this way when I hit the store and even if I go over budget I know I'm at least buying things we really need/want.

I also have things that aren't needs, but nice to have on the list like: White linen tablecloth, Kitchenaid attachments, etc.

If it's not on the list it doesn't get bought period because obviously I didn't think I needed it until saw it. If it is on the list it only gets bought if its below the target price.

I find that this really, really helps reign in spending.

For groceries I just shop with cash and set a weekly budget. If my pantry is full then I can afford to spend some of the week's money on salmon or steak, but if I need to stock up on some basics then we eat simpler meals. We are wine drinkers too and my husband buys it by the case at wine festivals twice a year so we budget for that and then don't buy any the rest of the year. We also host a lot of dinner parties and people always bring over a bottle and we end up with extra this way While entertaining can be expensive, feeding an extra person or two can still be less than going out to eat at a nice restaurant especially if your friends reciprocate or bring wine/or dessert.
post #25 of 141
I was bored so here goes:


WHAT is your goal? Do you BOTH (you both have to agree or it will never work) want to be debt free? Retire early? Pay off mortgage early? Have 12 months bills saved up? Have $10,000 in your savings account? WHAT is your goal? With NO goal, you have no reason to truly change anything.


As you have stated you are in debt, and spending more than you earn. This last month you were nearly $500 in the red and you said this "was reined in" AND that it was a "good month for you".



You have to either spend less money or make more. Period.



Get a joint goal and put it on paper, both sign it, give a time frame.... and post it everywhere so you BOTH can see it!







First off the red flags...

$310.05 Pets... is this normal??

$101.42 on thrifting.... WHAT exactly are you buying each month? Are you boredom shopping?

$80.76 craft supplies... what are you buying? That's alot for a hobby.

$71.79 postage... what are you spending so much postage on?

Groceries + eating out + Target = $1001.62 for the month for TWO people.




Here is another way to look at your spending (shake it up and look at it differently):


True Bills:

Banking fee: $6.95
Annual parking pass: $138
Mortgage: $1,248.51
Home repair/housewares: $119.20
Groceries: $359.49
Car payment: $300
City bill: $177
Cell phones: $79.84
Internet: $56.97
Gasoline: $44.12
Postage: $9.80
Gas: $17.48
To credit cards: $1,118.29
Savings: $100
Student loan: $257.60

-$4033.25





Not true bills:

Thrifting: $101.42
Eating out: $44.74
Gym dues/Weight Watchers: $22.36
Magazine subscriptions: $6.11
Cash withdrawal: $40
Clothes: $58.34
Craft supplies: $80.76
Postage: $61.99
Eating out: $275.68
Entertainment: $71.97
Target (some groceries, some not): $321.71
Pets: $310.05
Cable: $88.29

-$1483.42





I left cell phones and internet as a "bill"... we all have them and you can afford them. Pets was not put on true bills as it is a choice (not trying to debate care for animals... I have them too, but having a pet is a choice to be "technical").






Also at this rate of $100.00 per month, you will only save $1200.00 per year. In retrospect you spent $1001.62 on groceries/Target/eating out for the last month.




It would be best if you made a firm on paper budget for a goal you both agree on. Your "real" bills need to be paid FIRST. Your savings needs to come next. And then your "wants" come last out of what is left... not what you want to spend.





Eating out could be reduced by agreeing on one or more of the following:

Only eating out once a week or once a month.

Only eating out if you have a coupon.

Only eating out if it is under $xx.xx amount.

Only eating out within "set in stone" eating out budget.

Only eating out by using personal allowance.




Groceries can be reduced by having a set budget each week and using cash. Allow $xx.xx each week for gourmet ingrediants. You will feel less deprived. But when you eat them, they are gone until the next week.





Stay out of Target. Make it a personal challenge to go XXX many days.

Stay out of the thrift store. You can't possibly need $100 + month in clothes/trinkets/antiques/junk. Don't spend more on "stuff" until you can budget and not go red each month.

Suspend craft purchases until you have a real budget and do not go red each month.


Crafts and thrifting are more than you save each month. If you are boredom shopping or "deprivation" shopping, or addiction "but I am saving so much money" shopping... try to find something else to fill that hole.



You can't afford to do these things if you are red each month.



You make enough money to do them, but you have to budget them WISELY and not "impulse" shop. When you have a good working budget and are saving MORE than what you are "blowing"... budget in a weekly allowance for each of you and all misc spending comes out of that.


It's the best of both worlds!






We have BTDT too. It's harder to be "diciplined" when it's not a daily struggle to just survive and eat!








.
post #26 of 141
Are you on Etsy? That crafting supply/postage bill is crazy. That has GOT to go down.

I'd stay clear of target. We used to do that too...never leave with less than $80 each time. Now if we need TP or something, I just get it at the grocery store and save the gas and temptation.


What are you thrifting on, as well? That's high, too.

May I ask why the pet costs so much?

I'd go balls to the wall to get out of this debt. No cable, no internet. You have internet at work? Him at school? Public libraries or places around town with wi-fi? That's $60 a month. Heck, if you're nearing the end of your phone contract, drop the cells. We did and saving even more $ a month.

We used to make 60k a month (2 incomes) and had that same problem...just didn't have enough. Looking back, man, I wish I knew then I what know now.

Change your habits, change your life.
post #27 of 141
I won't say what our income is, BUT I find it so hard to stick to a cheap food budget. Organics can be expensive, and I feel guilty when I don't buy them, but it is just too much sometimes even if you cook from scratch.

I am trying to convince dh to get netflix instead of cable. We don't watch much tv anyway.

We are going down to eating out once a week which I think is helping. But then our washer broke, and set us back a bit.

That is great that you are paying off the CC. Go you!
post #28 of 141
Thread Starter 
OK, lots of good comments. I'll try to address everything:

Quote:
Originally Posted by whoMe View Post
Our internet is much cheaper. Can you find a better deal? Or even call and get them to lower it for you? Tell them you're going to switch providers if they don't...
I've looked into this before and not been able to find anything similar (high speed with wireless) that's cheaper, but I should probably look again. High speed at-home internet is necessary both for my freelance work and for Mark's working at home for school. It's pretty necessary.

Quote:
Originally Posted by Thystle View Post
I was bored so here goes:
WHAT is your goal? Do you BOTH (you both have to agree or it will never work) want to be debt free? Retire early? Pay off mortgage early? Have 12 months bills saved up? Have $10,000 in your savings account? WHAT is your goal? With NO goal, you have no reason to truly change anything.
My immediate goal is to get out of consumer debt, then my goal is to have a comfortable amount saved. Not sure how much. But those are personal goals. In terms of us as a couple, we're sort of counting on selling our house for a profit in a year or so to build some joint wealth. We don't really have joint savings goals, aside from not spending down our home emergency account (currently about $4,500) unless we have to.

Quote:
Originally Posted by Thystle View Post
$310.05 Pets... is this normal??
Not exactly. We have extra foster dogs right now, so we're buying extra food, and we had to refill an expensive three month prescription for our elderly dog this month. But pet expenses run about $125 month for food/vet insurance generally, plus $600/year meds and $400/year minimum for vet care, so it's pretty close. However, unless we were seriously starving or about to lose our house, we wouldn't feed our dogs and cats cheap food or stop their vet care, so...

Quote:
Originally Posted by Thystle View Post
$101.42 on thrifting.... WHAT exactly are you buying each month? Are you boredom shopping?
Not boredom so much as joy--I LOVE to thrift shop. This amount includes some clothing items for both my partner and I, some gift items, and lots of things I just wanted. Thrift shopping is my #1 hobby. I've been meaning to start keeping a record of exactly what I buy/how much I spend. I should probably do that.

Quote:
Originally Posted by Thystle View Post
$80.76 craft supplies... what are you buying? That's alot for a hobby.
This is honestly high. I ran out of several needed things this month (I make bath products). I usually spend more like $25/month, if that.

Quote:
Originally Posted by Thystle View Post
$71.79 postage... what are you spending so much postage on?
Swaps. Almost entirely.

Quote:
Originally Posted by Thystle View Post
We have BTDT too. It's harder to be "diciplined" when it's not a daily struggle to just survive and eat!
That's the thing that blows my mind--I never ran into debt at $18K, or as a student with almost no income. And I don't remember feeling particularly like I was missing out on anything then, either.

Quote:
Originally Posted by Savoir Faire View Post
Are you on Etsy? That crafting supply/postage bill is crazy. That has GOT to go down.
I am on Etsy, but I sell almost nothing. Mostly I make bath stuff for myself, for gifts, and for swaps. Right now mainly swaps.

Quote:
Originally Posted by Savoir Faire View Post
What are you thrifting on, as well? That's high, too.
See above. But honestly, I need to start keeping a complete record, because it doesn't quite even add up to me.

Quote:
Originally Posted by Savoir Faire View Post
May I ask why the pet costs so much?
This is the breakdown for the month:
$120 prescription arthritis medicine for elderly dog (90 days worth)
$80 dog food (two 30 lb bags)
$60 insurance for dogs (beginning of the year--it's usually only about $30/month and it has paid for itself many times)
$20 shelter fee for foster dog (will be reimbursed)
$30 cat food (one 15 lb bag)

There is actually also about $15 worth of cat litter mixed in with my Target spending.


Quote:
Originally Posted by Savoir Faire View Post
I'd go balls to the wall to get out of this debt. No cable, no internet. You have internet at work? Him at school? Public libraries or places around town with wi-fi? That's $60 a month. Heck, if you're nearing the end of your phone contract, drop the cells. We did and saving even more $ a month.
See above re: Internet. We don't have a land line, so I don't think canceling our cell phones would work, and we're not at the end of the contract anyway.

Ug. Writing this out honestly makes me feel sick. Not so much because I feel unstable in my situation, but because I feel like such a bloated, wasteful American a**hole. Yuck.
post #29 of 141
When I read your title I thought this would be a thread for high income folks cutting back, but your income isn't what I would consider high income. DH's is higher than what you've stated, but we consider ourselves solidly middle class, and I am a SAHM. I'm not sure exactly how to say this, but I'll just present it as our experience. My parents and DH's parents do fall into the solidly high income category. There is very little cutting back that they do because they have never been anything less than cautious and level headed about their money and investments. Maybe it was the generation, but eating out, shopping trips, huge homes, always the new or best of things just wasn't on their radar screen. For some in the wealthy category it's almost a badge of honor to see how realistic and frugal you can be. I personally think our generation-those of us in the 20's to 40's age range would do well to emulate them. I know we're trying, and it's a mindset that you just adjust yourself to. Not always easy, but it's worth the effort.
post #30 of 141
I thought of two more things. We started going to the library instead of the bookstore. This year we are not sending professional pictures of the kids for christmas cards. I'm getting cards at the dollar store and putting pictures in them that I photographed myself.

Don't get too down on yourself. Pick one or two things to cut back on. You already cut back on groceries so pat yourself on the back for that.
post #31 of 141
Thread Starter 
Quote:
Originally Posted by nichole View Post
I thought of two more things. We started going to the library instead of the bookstore.
I definitely do this. I am a huge, huge library patron. I never buy new books, and don't buy used ones often anymore.
post #32 of 141
Thread Starter 
Quote:
Originally Posted by karne View Post
When I read your title I thought this would be a thread for high income folks cutting back, but your income isn't what I would consider high income. DH's is higher than what you've stated, but we consider ourselves solidly middle class, and I am a SAHM.
It's kind of a stupid title, sorry. While it's definitely a high income for me (the most I've made), I know it's really just middle class. However, since we don't have kids, it is sort of made effectively higher.
post #33 of 141
No, it's not stupid at all! You are in a very solid position to be making this salary at your age, and you show wisdom beyond what I had at your age to be looking with such scutiny at your budget. More than any numbers you're working with, your attitude about money is what will see you through to your goals. I wish you the best of luck.
post #34 of 141
I just want to say that I think you are great for laying it all out there and taking everyones comments as constructively as they are meant! You are obviously a level headed person who sees the need to change, I think you will find a way!


My #1 advice, never go shopping without a list and never buy anything not on it. If you see something you want it has to go on a future shopping list and that gives you time to make a less impulse guided decision.,
post #35 of 141
I admire you for writing it out and being willing to take people's advice so thoughtfully. That's hard to do when you're looking at your own habits in a harsh light.

It *is* hard to cut back, but it's like a lot of habits: once the habit is made, it doesn't seem like any work to maintain it.

One thing that occurred to me is that if your issue is that you know the money is there and so you spend it, can you automatically divert some of your paycheck into a savings account so you never "see" it? I've found that dividing up my paycheck via autopay is one of the most effective ways I have of saving money. I never see it in my checking account so I'm never tempted to pull money out.
post #36 of 141
I know that when my salary hit a level I personally considered "high" I had all these perceptions of what I deserved. but, the reality is that when my salary went up, my partner's went down, and we were no more financially secure than before, but I sure felt like i deserved more. it helps me to think about our total income divided by two to help me put "my money" into perspective.

For example:

you earn 55,000 and have things you thought you would be able to do once you crossed the 50K mark. But, your husband is making $22K.

Are you living the life you would lead if you each made $38,500? i bet not. My guess is that if you each were making $35-$40K, you would be much more willing to make sacrifices...

It's all psychological, and I find that pooling our two incomes together and dividing by two helps me keep it all in perspective.
post #37 of 141
just quickly and i'll be back later tonight to discuss more. were considered high income (6500 net a month) and we are trying to be as frugal as possible too. have you seen my thread? it's called "7 months to being debt free".
post #38 of 141
Quote:
Originally Posted by avengingophelia View Post
I'd like to talk about the need for increased frugality and how to achieve it among those who are not low income. In particular, I am interested in those of us who have become accustomed to living a consumerist American middle-class+ life and are now trying to correct ourselves.

I can relate. Dh and I would probably be considered high income. We live in a high COL area (NYC), have 3 kids in different activites, rent an apartment (I don't really have any desire to buy a house), and have some debt. My goal is to be debt-free and I see us there in about 4 years. We're snowballing the payments and right now we pay out about $1400/month to debt alone. Rent is low, due to family-owned, 2-family house. I pay $25/month for full cable (over 300 channels), and very fast internet is free (I work for the cable company ). Bills equal about $1300/month and consist of the following:

Cable: $25
Internet: free
Cell Phone: $50
Home Phone: $60
Car Insurance: $130
Car Lease: $389 (never again )
Electric: $150 (summer) $65 (winter)
Gas (utility): $18
Gasoline: $450

I keep the grocery bill at around $600/month ($150/week) - and I try to keep things healthy and fairly organic. The kids' activities are a lot - dd (12) is a competitive dancer, dancing about 10 to 16 hours/week. It's her passion and I can't take that away from her. She also takes vocal lessons. Dd (14) takes guitar and 1 dance class, and dd (7) is in scouts, basketball, and 1 dance class. I also try to save a couple hundred/month and keep several hundred/month for those miscellaneous things that come up.

Believe it or not I do try and live frugally. The main goal for me is paying down the debt. We were almost debt-free 8 years ago until dh lost his job when I was a SAHM and 7 mos pregnant. It took us years to recover from that and we ended up accruing lots of debt because of it. I don't consider us very "consumerist" (I don't impulse shop, care much for clothes or primping, eat out much, or spend carelessly on the kids), but there are certain things I don't mind spending my money on.

I am, however, always lowering as many APRs as I can, groceries are 90% sale items, spend hardly anything on homeschooling 2 kids - even our trips are practically free (kids get free subway passes and my job gives us free corporate membership to almost all NYC museums and other cultural centers), dh's job comes with perks like free theme park passes, Broadway shows, luxury box seats to concerts and shows, etc, and we cook from scratch. So, I guess this isn't really a plea for help, but more of an understanding of having a certain standard of living one is accustomed to, yet still seeking ways to increase frugality.
post #39 of 141
Thread Starter 
Thank you so much for the support and the advice, everyone. I really appreciate you all being so nice to me and not just telling me I suck.
post #40 of 141
I think that in your situation what a lot of this comes down to is self-discipline and knowing how to set limits for yourself.

I can't fathom spending $70+/month on postage alone for swaps - but since you really enjoy swaps, so why not limit yourself to 2 swaps per month? It doesn't have to be all or nothing, it's about balance and that is something you don't currently have in your spending. Why not limit thrifting to once or twice a month and go with just a set amount of cash that you can spend and no more.

I think there is a lot of good that comes out of learning to tell oneself 'no, I don't really need this and although I want it, if I hadn't seen it I would be content with life" or "I want this, but I will wait to buy it for another few days."

Contentedness is such an important virtue to cultivate b/c it makes life much more pleasant and peaceful. It also helps combat the consumerist ideas of 'buy buy buy - want want want.'

I would probably advise you to go on a 1 month (or 1-2 week if one month is too much) spending fast - only buy food to eat but NOTHING material. Not clothes/crafts/postage/household 'stuff'/fun stuff. I have a few friends who have done that and they learned a lot about themselves and what was motivating them in life and it has helped them be more conscious and controlled in their spending b/c of what they learned from taking a break. If need be, give your DH the credit card/debit card/checkbook each day so you don't have the temptation to spend aside from a small cash allowance for food.
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