WE need to halve our living expenses - can you help?

H

Highlygeared

Hi All

we're trying to reduce our living expenses but finding it tough going trying to get it lower than what we live on today. Works on paper but harder in reality - routines, habits and all that. Does anyone think we're living too extravagantly? If so how can we realistically slash our budget by say $20K per annum? Would love to hear your thoughts on cutting our budget to a sustainable, sensible limit.

Have attached a table showing what our expenses are per day, week, month and yearly equivalent.
 

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How many under roof do you have? 2 adults/2 children?

Straight up I reckon you could get circa $5000 off your grocery bill with a food plan and eating more leftover lunches.


pinkboy
 
Start with the things that don't materially reduce living standards (and may improve health) if you go without. Eg an outright ban on soft drink, takeaway coffee, cakes, etc.

It is better to reduce purchases of some things by 100% and important things not at all than try to reduce everything by 50%.

But if you still want to consume some of those things change the way you consume it. Eg a slice of cake costs $3. Whereas you can make a whole cake from a $2 pack of cake mix with carrot, banana & lemon added for extra substance. Or buy a $2 pack of biscuits and wrap a few in gladwrap for later consumption rather than paying more than that per time (resisting the temptation to scoff the whole pack in one go!). Or maybe home brand lemonade augmented by the juice and rind of real lemons.

That's just the junk food. A quiche with carrot, potato, onion, spinach, zucchini, eggs and tuna is economical, nutritious and filling with optional cheese and tomato sauce. A couple of slices could easily pass for a meal.
 
the main ones that jump out to me are $18k/yr on groceries in addition to $4k/yr r on bought lunches and $2k or so on takeaway

groceries are far too much, that can easily be cut by eating more in season f+v, making buying meat in bulk, cooking secondary cuts instead of prime ones, shopping at the right places etc

im sure it would be possible to at least cut the lunch bill in half by preparing lunches 2/3 times a week, i guess it would come down to motivation and how badly you need to cut expenses as im sure there are times where having 3 kids would be exhausting
 
There could be movement in the groceries, takeaway and lunches. Shopping at Aldi or warehouse type stores could reduce your spend. Making lunch at home or taking supplies to work from home will at least halve your spend. While your takeaway spend isn't high, that could be eliminated.

Things were a bit tough for us a few years back. We saved an absolute fortune on groceries. Admittedly we each put on a few kilos living on staples of pasta, potatoes and sausages but we were making $5 meals and at the time that was more important than a number on the scales.
 
Highlygeared said:
Hi All

we're trying to reduce our living expenses but finding it tough going trying to get it lower than what we live on today. Works on paper but harder in reality - routines, habits and all that. Does anyone think we're living too extravagantly? If so how can we realistically slash our budget by say $20K per annum? Would love to hear your thoughts on cutting our budget to a sustainable, sensible limit.

Have attached a table showing what our expenses are per day, week, month and yearly equivalent.
Click to expand...

I think your budget is pretty reasonable for a family of 5. I have one of those and my figures are similar to your except 2 things
- my health insurance is a lot more at around $350 pmth
- my groceries are less at $200 per week

The best thing to keep grocery prices down is to meal plan and do online grocery shopping. Meal planning will ensure that you only purchase the items needed for the next 7 or 14 days and stops impulse buying that happens when you are cruising the supermarket aisles.

When I have a clear meal plan for the week or fortnight then I find it so much easier to stick to budget and I don't need to pop down to shops for item X and end up spending $40.

You will learn recipes which can still be healthy but hearty and not too expensive. If you make enough then freeze or take for lunch the next day.
 
BTW those figures in your budget aren't from reality are they? You are just guessing judging by those nicely rounded figures.

You need to track every dollar spent before you can budget. Write down everything for a fortnight and you will see where the money leak is.

Petrol seems a bit high at $200 per month - is there an option to take more public transport?
 
 
I'm not seeing any accommodation-related expenses in that budget. What about rates/house insurance/rent/mortgage?

Re the rest of the budget, I concur with other comments already. Groceries is too high by at least $5K - minimise treats, avoid prepared meals that come in boxes/cans, make meals from scratch more often and smaller meat portions offset by more fruit and vege, make a shopping list based mostly on sales items that week. Buy lunch at work once a month, not once a day, and have home prepared meals/leftovers all other times. Health fund is a luxury IMO as medicare will keep you all alive, so I'd drop that. The outside world is my gym, so I'd drop that too. Kids sports expenses seem pretty high and could be halved and give your kids back some more "them" time.
 
Ace in the Hole said:
Katherine is your friend !!!
Click to expand...

:)

In 51 days we spent $297.93 in groceries, but that was only for 2 people.
During this time we did eat away from home for 9 meals.

Now, our meals are included at no charge, where we are staying at...so restaurant food for the next few months

For a family of 5..$125 is plenty IMO
You will need to make changes..and most people don't like to do that.
 
kathryn d said:
:)
For a family of 5..$125 is plenty IMO
Click to expand...

Wow, that's low. Good on you Katherine.

Your food bill seems really high. That's the only major thing that sticks out to me which others have mentioned.

Some of those other costs seem lower than I would expect. Also stated previously, I imagine this is guesstimates?
 
Lots of responses here already and many thanks for that.

To address some of the feedback, the numbers are pretty close to reality as I've been tracking it a few years - maybe not writing every expense down but on a yearly basis, usually works out the same.

I didn't put our living expenses down bc that is something we can't (won't) negotiate on - we absolutely love where we live and whilst it isn't cheap, its cheap for where we live and what we live in. For the record, we pay $700 pw.

Sounds like our food bill is excessive - ok perhaps we need to work on that a little more. Problem is my wife's the one who does most of the shopping and she isnt' as much of a tighta@se/'astute' as me. So reducing that is essentially me changing her habits. That's a problem in itself. She's not extravagant but she doesn't check the price before taking something off the shelf.

Re; gym and kids sports that is also hard - particularly the kids sport. I guess I could give up on the gym but it has been a way of life for me for the last 20 yrs. I train with weights so its not like I just go use the treadmill or stationary bike and could swap that for a run in the park. But point taken.

As for earning more - ok there's more context to my thread. We are Highlygeared but have a property portfolio that is pretty sizeable and I'm contemplating LOE within 2-3 years and hopefully completely LOR a little further down the track. I don't like the thought of LOE ad infinitum but if its for a finite period and a relatively safe combo of LOR/LOE then I can live with that. The way look at it is - I'd rather retire from my JOB (which I hate and is extremely stressful) sooner and enjoy some of the equity we have rather than suffer longer and follow the 'safe' path. We'll all die one day and we can't take our E with us....so why not enjoy what we've worked for sooner if the benefits outweigh the risk.

Long story short is that if we were to fast track ,LOE then living off less has to be a part of that equation. I might in my free time follow one of my passions and make $ out of it but the point is not to put undue pressure on myself by swapping one form of stress with another ie no JOB but HAVE to generate $x pretty quickly and consistently or we'll risk our nest egg.

Therefore the goal is to live on no more than $70-80K including rent. For some that might be easy but for our family of 5, its more like $100K (minimum) with us 'feeling' like we're trying hard to keep it down.
 
Highlygeared said:
.

Sounds like our food bill is excessive - ok perhaps we need to work on that a little more. Problem is my wife's the one who does most of the shopping and she isnt' as much of a tighta@se/'astute' as me. So reducing that is essentially me changing her habits. That's a problem in itself. She's not extravagant but she doesn't check the price before taking something off the shelf.

Therefore the goal is to live on no more than $70-80K including rent. For some that might be easy but for our family of 5, its more like $100K (minimum) with us 'feeling' like we're trying hard to keep it down.
Click to expand...

Yes, that food bill is excessive. Only way you can reduce it though, is to get your wife on board with what you are trying to do, and start taking packed lunches to work will help too.

My mind simply boggles on how you can possibly spend $350pw on groceries. Basically that is only 7 breakfasts, 6 diners and weekend lunch per week, because I'm presuming that your takeaway allowance is one day per week. Of course, you've got some other consumables included in there like cleaners & toilet paper etc.
 
FWIW, my wife also used to be quite spendy with grocery shopping, but about a year ago I convinced her to let me have a go for a month and see if I could bring the cost down without bringing down the perceived quality. I was able to reduce the budget by nearly 50%, with the only real side effects being that I had to cook a bit more, that treats became treats again because I rarely bought the stuff anymore and we both lost and kept off 5kgs through the resultant healthier eating. Subsequent to this, we both go food shopping now and while there has been a little creep in our food budget since then, it is still some 40% below what we used to spend.
 
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