Save Money After A Pay Cut, step by step
The bummer-of-an-economy hit home with us a few weeks ago. My company issued pay cuts to all employees in an effort to ward off having to take more drastic cost-saving measures down the road. It is obviously not news I hoped to hear, but I was certainly grateful that it was not worse. When I told Sherry about it, we shared some moments of disbelief, anger, and worry. But over the following days we slowly embraced the reality of having to live on about $400 less per month.
You folks know that we have already adopted a fairly affordable lifestyle and pride ourselves on being able to live life to the fullest even when our wallets are not (Sherry gives me haircuts, we are a one-car household, we eat in all the time, I brown bag my lunch, etc). But we have gotta be honest: four hundred beans seemed like a lot to cut out of our already no frills budget. We do not have it 100% figured out yet, but I thought we’d let you in on how we are planning to adjust so far.
1. Kick my iTunes habit: It is small, but I can keep a few bucks in our bank account 99 cents at a time by being a bit less iTunes glad. Music is to me as shoes are to Sherry (yeah old school SAT-style analogy), so I am trying to absorb my pay cut a bit by rediscovering my existing music collection, and turning to Internet radio and YouTube when I want to enjoy playlists of new music.
2. Pause my gym membership: I work out at the Richmond area YMCA, and primarily use it as a place to shower after a lunchtime run downtown. By simply shifting my runs to mornings or evenings I can shower at home, where it is free. And since it will not cost me to restart my membership, I will not be penalized for taking a break. Though Sherry will have to do without my rippling muscles for a little while (please note the sarcasm).
3. Trim our vacation by a couple days: We’d saved up for a week-long road trip to Atlanta, Savannah and Charleston, but we chose to cut back a little by holding off on Charleston for next time. Shortening our little trip by 2 days put nearly $250 back in our pocket in hotel fees alone. Plus, we cannot complain about the extra time that we spent relaxing in our own home sweet home instead.
4. Watch movies at home: Movies are likely second to my music obsession, so we try to allow ourselves a couple of trips to the theater each month. Instead I am simply going to practice patience this summer and rely on our Netflix subscription to satisfy my craving for cinema.
5. Cash in some credit card points: Sherry and I have gotten into the habit of using our credit cards to pay for simply about everything. Not because it allowed us to buy things we cannot afford (we pay it off in full each month) but because it is an straightforward way to track our spending. A few years of this habit later, we have wracked up quite a few points and have at last chose to trade them in for some bonus dinero.
6. Remember our refinance safety net: The strong coincidence of all this is that my $400/month pay cut came simply days after we refinanced, which reduced our monthly payment by – you guessed it – $400 per month. Perhaps it is all a big financial joke the universe is playing on us, but we are still planning to have the last laugh. We hope to be able to continue to overpay our mortgage each month, but find comfort in the fact that we can reduce our monthly expenses by exactly $400 by letting that go if we encounter any unexpected expenses.
All in all, we are fairly optimistic about everything. With Sherry having earned a variable freelancers income for over 3 years now, we are well versed in adjusting our spending based on how much we are bringing in each month. So ’til the economy gets better (knock on wood) we have our noses to the grindstone and our hands out of the piggy bank. Have any of you folks felt the financial pinch especially hard lately? We know we are certainly not the only ones with employment woes, so feel free to commiserate or, better yet, offer up some money saving pointers or words of encouragement to the group.
And speaking of money saving pointers, check out our other moolah-related posts which list a bunch of things that we do to keep cash in our wallets and smiles on our faces. Here is the first one, the second, and the third. Glad saving to one and all.
