By Cindy Santos-Mendoza
I know many blogs, articles and even full books have been written on the subject of cutting personal expenses. Trust me. I’ve read them. However, as a busy mom of two little ones who also works from home, it is hard to have full control of all the money coming in and going out. My husband is constantly reminding me that it is not about how much you bring in, but how much you spend out.
I am a bit of a Type A person, so for 14 years I used Microsoft Money to keep track of every single dime that we spent. That plan came to an end when I became a mom. Not because I didn’t think it was necessary. Instead, it was because I didn’t have time to sleep or eat so I wasn’t about to spend my time entering receipts. Then, my computer crashed and I lost all my files and after the initial stress of feeling lost passed, I actually felt relieved! No more penny counting.
I am not a big spender so I didn’t feel as though I needed to keep track of that much spending, until I did. Right around March that year, I started to get antsy about filing our taxes and then it was crunch time. I needed to backtrack my expenses to be able to file them. I endured one month of complete anxiety, but I finally found my Year End Expense Report. That’s when it hit me! We spent how much on clothes? Starbucks? Magazines?? I don’t even have time to read magazines!!! But then again, these things went unnoticed because I went on with my daily living and daily spending not really paying attention to where the money was going.
Fast forward to this year. From the start, I wanted to focus on living my best year ever! I had attended Darren Hardy’s High Performance Summit and I was incredibly inspired. I was also working with Landon Taylor on the launch of the Wealth Triangle website. And I felt that this was the year to get focused. I set my priorities straight, focused on my goals, and realized that I needed a financial makeover.
I found that way too much money was going out on unnecessary expenses for me to be able to achieve my financial goals. I went to work on looking at every single expense and if it was not a necessity, I removed it. I found out that most of those expenses came from subscriptions to magazines, health and beauty products, monitoring services, email accounts (yes, I was still paying for AOL!!), and other types of expenses that were hiding under that monthly automatic withdraw. Since I didn’t have to write a check, or send a payment every month I wasn’t really aware of how much these small little expenses were impacting my finances. In all, I was able to cut $1400 per year! I can definitely find better ways to invest that money.
I was psyched about all of the new possibilities. I examined our family’s expenses with a fine-tooth comb, including my daughters’ after school programs, beauty expenses such as weekly manicures, the cost of dining out, and grocery expenses. You name it! I found it and made some tough decisions about our spending habits for the purpose of cutting more expenses.
In the end, I realized that mindless spending is also mindless living. I needed to pay more attention to how and where we were spending our money so we could actually make a decision on what was important to us as a family. The real question became: What is it worth to us?
Cutting down on those small expenses perhaps could be better spent on sending an extra payment toward our mortgage, which could save us thousands of dollars over the life of the loan.
I am not saying I don’t go to Starbucks anymore, or that I don’t get manicures. I do. But I know I am very conscious of when I do it, and I decide if that is exactly where I want my money to go. It turns out that the process of cutting personal expenses is less of a sacrifice, and more about putting money where it matters most.