Income vs. Outgo & 10 Ways to Substantially Save Money Each Month

When we consider financial preparedness, it is so easy to sit in our homes, watching our TV’s (or computers) and to belly-ache about how costs are rising or how it’s hard to make ends meet.  It’s both as simple as income vs. outgo and NOT as simple as income vs. outgo.  We all know that for our personal balance sheet to work properly, what we bring in must be more than we spend.  We tackled that topic a few weeks back, and how it is important that we spend appropriately less than we make.

When it is as simple as income vs. outgo

Since we aren’t the federal government, we actually have to be fiscally responsible.  While living on credit is totally possible for a while, no one can do that long-term.  It’s a fiscal necessity to make sure that we bring in more than we spend.

It’s HARD sometimes.  Do you find it hard to exercise financial self-control?  Or maybe you don’t have an emergency fund built up enough to take care of those unexpected, unpleasant financial surprises that happen?   It’s hard when the cost of everything just keeps going up and up.  Our grocery budget is larger than our mortgage payment, and that’s saying something!  Several of our bills just keep going up.

Do you feel it too?  Does it feel harder to make ends meet than it used to?  I bet it does.  Even then, just like me, you know that on one level, finances are as simple as income vs. outgo.  Bring in more than you spend.

When it’s not as simple as income vs. outgo

Sometimes, however, bringing in more than you spend on any given month, doesn’t give you the full view of your financial picture.  If you work on commission, some months may be so much better than others.  We have a chiropractor friend who makes money based on how many clients he sees.  Some months, he has more patients than in other months.  If you are a waiter or a waitress, your income changes from day to day.  You never know when you’re going to have an amazing day and when you’re going to get gypped by people.

If you live in a situation like that, you can’t always live by the principle ‘spend less than you bring in.’  You need to consider your financial picture by the year or more.  If you make $6,000 in November and December most years, but only tend to make an average of $4000 most of the rest of the year, it makes more sense to take your yearly income of $52,000 and spend $4,333 each month.  You have to have the willpower to not spend $6,000 on the months when you make it, but to put the extra back so that you have it when you need it.

Outgo

So how can we lower our outgo so that we spend less than we bring in?  I don’t want to go into all the things that you really know on your own, like cut down on non-necessities like music lessons, your cable bill, expensive cell phone plans, cut your grocery budget etc.  I want to give you some creative ways to think about your finances that you may not have considered before.

1.)  Lower the temperature on your hot water heater.

A hot water heater accounts for almost 14% of your entire utility costs.  That’s HUGE.  If you lower the temperature on your hot water heater to 120-130 degrees Fahrenheit, you’ll end up saving yourself money each month on your utilities.

2.)  Start by using thrift stores

Oftentimes, we can get a lot of clothes at Thrift Stores.  While I can’t often get everything I need there for myself, I have found some amazing thrift store deals.  I can find what my kids need at thrift stores more often.  We always start at the Thrift Stores and if I can’t find it there, then we will head to Wal-Mart especially when we’re talking clothes.  You don’t have to end there, but starting there is the way to save a good deal.

3.)  Make your own cleaning supplies

Make your own glass cleaner on the cheap.

Make your own amazing scouring powder for next to nothing.

4.)  When you travel, stay in people’s homes for free.

If you are a Christian, there is a way for you to stay at places for one or two nights for free through something called the Candle in the Window Hospitality Network.  When you join (for only $15) you fill out the information about your location and how many people you can put up in your house.  You are then free to search their member database when you take a trip and are looking for a place to stay for a night or two as you travel.  There are no guarantees that you’ll find someone in the area that you are traveling through or wanting to go, but for only $15 and so many families that you can potentially stay with, you could potentially save a bunch!

5.) Take advantage of discounts like Costco, AAA, Military, Teacher, or Senior Citizen

Did you know that Costco can save you money on renting a car?  They can also offer discounts on certain types of travel, on life insurance, car insurance, health, dental, and vision insurance.

AAA gives you opportunities for discounts for travel, car rental, hotels, car, and homeowners insurance.  Some restaurants even give a AAA discount.  You can get a discount on prescription meds.  You can earn AAA bucks back when you use their link to shop at Books-A-Million, Bass Pro Shop, Banana Republic, and Columbia Sportswear and more.

Teacher discounts oftentimes also are open to home educators.  Make sure you check out places that an educator discount is valid including Borders Books.

Make sure you check policies at your favorite restaurants and theaters.  Some “Senior Citizens” discounts start at 50.  Can you say, “That’s young, but I’ll take it?”   Well, *I’ll* take it in a few years at least.

6.) Use a clothesline 

Save around 6% on utility bills.  I’ve covered this one in-depth.  Check it out here.

7.) Each month spend a little money to switch out all the light bulbs in just ONE room in your house.

Costco has amazing prices on really good LED light bulbs.  Sometimes it’s a pain in the backside to switch them out (especially the high ones), but doing this will save you an average of $300-$500 per year.

8.)  Do you still have a landline?

Switch out your landline for a device we call an Ooma.  We purchased one about seven years ago, and we still have the same one.  The Ooma is connected to your wifi.  If you still have a landline, then you can even transfer your landline number to the Ooma.  I currently pay for the local taxes on the number each month and that’s it.  We keep this line because I don’t want my kids having cell phones yet, but some are old enough to be home on their own.  I want them to be able to reach me if they need to.

9.) Eat more soup

In the early colonial days and even through the days of westward expansion, soups were a normal fare in the house.  You would use the ingredients that you had on hand and if you had guests, you just added more water to the soup to spread it out more.  While using inexpensive ingredients, we can still make our soups a bit more chunky than it would otherwise be.  Soups are, in general, an inexpensive way to feed an army and are an excellent way to stretch the budget.

10.) Amazon Prime

Yes, the Amazon Prime fee has gone up, but when you pay yearly, the cost is only $10/month.  That’s cheaper than what I currently pay for Netflix.  With that once yearly fee, you get a streaming video service just like Netflix, but you get SO MUCH MORE.  Amazon has some of the best prices on most goods that I purchase.

While you don’t need to pay for Prime to shop through Amazon, when you have a Prime account, you get FREE 2 day shipping on a lot of their products!

You also get FREE returns on items that were ordered through Prime.

If you aren’t already set up on Spotify, Amazon has a similar music service FREE to Prime members.

Kindle Owners lending library offers to lend over 500,000 books FREE as a part of your Prime membership.  The list of books includes many bestsellers.

What About You?

What other ways can you think of that you can cut money from the outgoing side of your budget?  Do you have a creative way of thinking about how to balance the income/outgo ratio?  Share your ideas with us so that we can all be better prepared.  Leave a comment below and share it with all of us!

Together lets Love, Learn, Practice, Overcome

There are links in this post.  Some of the links may be affiliate links.  Some of the links may not be.  My promise to you is that I will only recommend the most economical version of the best quality of items to serve you. These are the items that I have bought for my own family.  You can feel free to use my affiliate links, of which I will get a small amount in compensation, or you can choose to search out your products on your own.

This is a repost of an original which was published on October 3, 2018.