As I wrote my budget down, I started realizing that most of my big expenses were fixed expenses: rent, Internet connection, cable TV, car expenses, cell phone. Rent was my largest dollar cost, of course, but it was reasonably low since I lived away from town with roommates. My Internet and cable costs were tied up in that as well because of the roommates and car expenses didn’t seem under my short-term control.
So I started with my cell phone. I’ve never been a big talker, so it was a natural place to cut costs. I looked through six months of statements to figure out my average and peak monthly usage (150 and 300 minutes). With that information in hand, I searched around for the cheapest plans possible. In the end, I got a T-Mobile pre-paid phone and 1250 minutes for $140. I’ve since paid 30-50% of my previous bill each month without changing my calling habits at all.
Emboldened by my success with the cell phone, I started looking at my car. Since I worked from home and could ride the bus for free, I didn’t do all that much driving. I talked to my insurance agent and was able to reduce my rate a little based on that. It still seemed a little high, so I started searching around. I found that a lapse of insurance two years prior was basically doubling my rates! They told me there wasn’t anything I could do about that, so I found a different company that didn’t care. I also dropped down to minimum coverage and set about driving even less. So far, that’s saving me $30 a month, which adds up!
Moving from short-term to long-term
My girlfriend and I got engaged in the spring, which necessitated different living arrangements. After looking for a while, we found a duplex that wasn’t much more expensive than our old place. My fiancé and I live in one half and my old roommates and business partners live in the other half. This means that my “commute” involves walking across the front yard. Even though the rent was higher, this meant that I used my car even less, which saved a lot just based on gas prices. We also dropped cable in the move and started splitting the Internet four ways instead of three (with a wireless router broadcasting across the duplex). So far, we haven’t missed TV much although we do have Netflix.
I’d done all I could about reducing my fixed expenses. Rent was higher, but reduced my car costs and Internet cost, so it worked out better overall. With a relatively large up-front cost, I was able to reduce my monthly cell phone cost and car insurance costs. The only thing left was to tackle the dreaded budget.
See also: How I learned to love my budget (part I)