Break the Spending Cycle

Just like being on a diet, being frugal seems to go in cycles.  One month we may get our ship going in the right direction, and BAM, the next month we totally drift off course.  In the months leading up to buying our house we saved hard, almost 50% of our income.  For three weeks after we closed, we went into a buying spree that left us with $4,000 of debt.  Some of these purchases were legitimate needs, but much of it was not.  We spent money to celebrate our milestone ($400 for a self thrown house warming party anyone?) and rebel against our months of restricted spending (how about a flat screen TV?).  We went from spending 50% of our income to spending 200% of our income in an instant.

By starting this blog I took the first steps in reigning back in the excess that accompanied home ownership.  Today I am taking another step to try and address some of the recurring expenses that sneaked their way into the budget.  By addressing regular monthly bills I will make a lasting impression on my budget.  Rather than require my will power to hold up next month as if this were a spending diet, I've trimmed my lifestyle instead.  To continue the weight loss analogy, what I did today is like starting an exercise routine rather than some fad two-week juice diet.

The first bill I trimmed is the $41 a month land-line telephone bill.  The most basic telephone hook up from AT&T is $16 and change per month.  Next we add another $9 to add the 2-Option package for Call Waiting and Caller ID.  My wife deems it absolutely necessary to have the ability to screen calls and insists we have Caller ID.  Call Waiting is almost useless but it comes as a package deal.  We also have $2.99 for long distance service which to my knowledge has never been used.  Finally there is an assortment of taxes and fees that bring the total up to $41.

To go about reducing this bill I had very few options.  One would be to convince my wife that we don't need Caller ID.  I was unsuccessful in this task so I moved on.  I did some research and learned that AT&T is currently offering an online-only long distance package that is FREE.  That's right, no charge at all, and a fairly reasonable $0.12 per minute.  Since we never use this except for maybe in the event of an emergency this is great.  It will knock $4.52 including taxes off of our bill.  Next month we should be charged only $36 for telephone service.

The next bill to go about reducing is the satellite TV.   At present it runs $81 a month for the top tier service with two premium channels, High Def programming, and a DVR.  We currently get a $27 credit each month that covers the HD service and the DVR, but that credit will go away in August so the the bill will jump to $108 a month.  That is just too much to pay for TV.  We hardly watch the premium channels so that is the first place to start.  Dropping those will reduce the bill $15 + tax or down to about $65.  For a while I was watching Showtime frequently for several of their series, but lately these shows have been out of the lineup.  Dexter, Weeds, and Californication are great, but I'm not sure if they are worth $16 a month.  All of them will eventually be available from Netflix so today I am going to call and get rid of the premiums.

It may not be a lot but with a couple of phone calls I have trimmed a bit more than $20 a month from my budget.  I can now allocate the extra money to paying down my debt just a little bit faster.  If you factor in the interest savings it will cut a full month off of my repayment plan.  It will be a great day when I am finally free of my consumer debt, and this little action will bring me that much closer.