Three Practical Ways we Saved $520 a Month Last Year

cut back expensesLast week I wrote about how we’re saving for our home emergency fund and I mentioned that last year we were able to reduce our expenses by $400 a month.  After doing a year-end review of our finances I realized that the number is actually closer to $520 a month.  So I decided to outline how we did this.

Last year we started on a mission to cut back our expenses and use that extra money to pay down our debt.  We have had a nice balance on spending and saving through out the years.  We saved to put 20% down on our home and to pay for some of the renovations needed.  However, after incurring credit card debt due to our home renovations in 2012 we knew we really needed to tighten our belts in order to pay off our debt sooner rather than later.

We are not really crazy spenders but we knew were using a good chunk of our discretionary income on entertainment and other material things.   We decided to take a second look at our budget to see where we could cut back our spending.  These are the three most practical ways we were able to save money last year.

Eating Out

We used to eat out 2 times per week.  Each time we would spend approximately $35 to $40 per meal which added up to about $80 per week.   For the past 9 months we have cut back on eating out.  Now I cook 6 times per week and we order take out only 1 time per week.  We keep it to $20 per order saving us approximately $220 per month.


Our monthly allowance is the money we use to pay for gas, lunch or other incidentals relating to work or any other item we want to buy for ourselves.  We can spend it as we see fit without having to check in with each other.  Since most of this money is discretionary we decided we could live with less and we were able to cut $200 per month from our allowance.


When we moved in to our house we ended up having a much bigger closet where I could fit all my clothing.  This was an eye-opening experience as I was able to clearly see how much clothing I had.  I could not believe that I had almost 20 pairs of jeans!  I had to say, Really?  This is ridiculous!  Not to mention all the other items of clothing, handbags and shoes I had accumulated throughout the years.  I decided right there and then that I would drastically reduce my spending on clothing.  I did not need another pair of jeans!  I’m not exactly sure how much we saved in this category but just by adding up how much I usually pay for jeans, tops, shoes and handbags I can safely say we saved approximately $100 per month.

We started the mission to cut back our expenses in May of 2013.  We also decided to cut back on concert tickets and vacations but we had already taken 2 small trips and attended a few concerts before we decided to cut back so that savings was not as significant as the ones stated above.  As I mentioned the savings were used to pay down our debt.  We were successful at paying off one credit card debt of $8,000 last year.  This year we’re working on knocking off the remaining credit card debt with these savings.

After seeing how easily we found ways to cut back expenses within our budget we became avid fans of finding new ways to save. We are continuing with this mission in 2014 and we’re spreading the word to our friends and family so they can do the same.

What practical ways have you found to cut back your expenses?

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This post was included in the Carnival of Money Pros hosted by The Money Principle.


Three Practical Ways we Saved $520 a Month Last Year — 32 Comments

  1. We’ve been trying really hard to cut down on eating out. As much as we enjoy this it is really expensive. Thankfully after only one month of really tracking our eating out expenses and subsequently cutting down, we’ve really noticed a difference. I think seeing our bank account improve will keep us motivated!
    Liz recently posted…January {In Review}My Profile

    • It was difficult for us in the beginning too. Especially when your friends are calling to go out to eat but now that they know we are on a mission they’ve become more supportive.

    • I agree, once you’re at the restaurant it’s hard to control yourself. It’s better to avoid going in. It gets easier the more you practice staying home and cooking your own meals.

    • For me having small closets in my old apartment just made me forget which clothes I had because I had things in drawers or under the bed in storage. I just kept buying the same items because I couldn’t remember I owned them already.

  2. I’d have to say the most practical way we save money is meal planning and shopping once per week. We used to go to the store whenever we needed something to make the meal we wanted that night. That lead to us spending tons more than we had to. Now, our grocery bill is down about $300 per month, just by sticking to meal planning and structured shopping.
    JRod @ CNA Finance recently posted…Stock Markets Are Down, What We Should Learn From ItMy Profile

    • Our spending was a bit high in these categories so it was easier to be able to cut back this much. Right now we are at reasonable limits so it would be harder for us to cut more.

  3. We rarely eat out anymore with a little baby…he’s good during the day but once we get to night time, it’s not a good idea to bring him to a restaurant! I will say that we have spent a little more buying lunch at work as we have less time to pack lunches and might order out because we have less time to cook. So I guess it evens out a bit.
    Andrew@livingrichcheaply recently posted…Are You (Financially) Better Off Than Your Parents?My Profile

  4. As much as I love eating out at restaurants, the prices are incredibly high. I can make the same food for a cheaper prices, and in the long run it might actually taste better without the wait. However, fast food is much faster, and doesn’t require as much time to prepare a meal. Now, that I have more time at home, I am able to cook more, and after cutting down on eating out, it made a huge difference in my monthly income.
    David recently posted…How to Maximize Retirement IncomeMy Profile

    • My cooking has improved now that I cook more so that is another positive about eating out less. We only dine out as a treat now and will probably remain that way now that we can see the huge savings.

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