Ok, here’s the deal. Money just got tight. Maybe you’ve seen this coming for a while, or maybe you just got hit with a big expense from a job loss, medical expense or car repair. Whatever the case may be, you need to cut costs in order to meet your critical financial obligations. Well, here’s a list of bills and expenses you can skip this month. Proceed with caution, because some of these are easier to pull off and have fewer consequences than others. Remember, the end goal is to create a balanced and sustainable long-term budget that keeps your credit intact.
1. Storage Unit
Depending on size, storage units can range in price greatly, and many consumers spend around $100 per month for their units. In a financial bind, renting a storage unit just doesn’t make much sense. There might be contracts involved, but talk to the management company about how much notice they need and how much it will cost to end the service. Then, find room to store your stuff in your own living quarters or with friends and family. Even better, sell what you can to make some extra cash.
What’s one of the most expensive grocery products you buy each month? That answer is probably “meat.” Sure, you need protein but you should consider alternative sources, which will give you what you need at a cheaper cost per gram. Some options include: peas, beans, quinoa, seeds, nuts and nut butters, chickpeas, tofu, edamame, greens (broccoli, spinach), and milk and cheese (including soy and nut milk).
3. Your Medical Bills (at least in full)
We would never encourage consumers to actively avoid paying bills. Because after all, that can have a credit impact, lead to collection activity and so forth. That said, medical bills are some of the most flexible and forgiving when you are working with the provider or their billing group directly. Simply call them and explain the hardship you are facing and ask for a month of no payments (or potentially a greatly reduced payment).
The good news is that the bill likely has little or no interest, so there is really no repercussion for doing this as long as you communicate.
4. Coffee (from anywhere other than home or work)
You might need to stay wired through the day, but you don’t want a jittery budget. Buy coffee at the store to make at home and take advantage of free coffee at work. The price you pay for one or two coffees out at a coffee shop is the same price you will pay to brew between 50-100 cups of cheap coffee at home (yes, you read that correctly).
5. Lawn Care
Everyone wants a nice looking yard and “curb appeal” but sometimes the costs aren’t worth it. When money is tight, take a break from paying for lawn service. Instead, do the work yourself or ask friends and family for help. As a worst-case scenario skip the work altogether. If money is really tight, you’ll want to ensure you make your rent or mortgage payments and the lawn can be taken care of later.
After all, this is really only a problem for about half the year, anyway.
Haircuts might seem trivial, but for men they can add $25 or more to a budget each month, and women frequently pay more than $100 when they head to the salon. Consider postponing your next style upgrade or asking family or friends to cut your hair.
No, Netflix isn’t very expensive so this won’t save you much, but the best news is that there is no termination fee. Cancel Netflix when you need to save a few bucks, and then restart the service later when your finances stabilize.
8. Gas and Vehicle Depreciation
Gas prices fluctuate, but once you factor in depreciation and maintenance, your car is pretty expensive to drive each day. If available, consider public transit and carpooling options and crunch the numbers to see if those will save you money.
9. Meals Out
No surprise here. Eating out is typically more expensive and less healthy than what you can make at home. Pack lunches to take to work and develop a structured dinner meal plan to help you save. If you have to eat out, be sure to look for coupons and deals first. Sites like Groupon and restaurant.com are great resources.
10. Newspapers (yes, people still read those)
You might be stuck if you’re under a subscription contract, but if you pick up your paper from the grocery store, news stand or gas station, then this will be an easy cost to cut. Newspaper articles are frequently available online for free, and even if your preferred paper isn’t easily available online, some news certainly is. The same advice applies to magazines and even books (don’t buy books at all, and opt for the library instead).
11. No-Contract Cell Phone Bill
Hopefully you’ve made the move to ditch a traditional cell phone contract and opt for a pay-as-you-go or no-contract provider. If so, cancel your service to save some cash. You can use free services like Google voice to get you through the slump and then restart service later.
12. Dry Cleaning
Dry cleaning expenses add up quickly, and according to Business Insider cost an average of $500 per year (or $42 per month). Avoid it altogether if you can, and try DIY methods (like a handheld steamer or a dry cleaning kit). Also, consider just going less frequently. Wool suits, in particular, can be worn up to six times in between cleanings.
In terms of food budgeting, alcohol is a “want.” Cut it out of the budget to save.
Gift giving is a fundamental part of our consumerist culture, but the spending isn’t necessary when you are trying to save. Whether it’s birthdays, anniversaries or the winter holidays, opt for regifting or homemade gifts when possible. Communicate openly with family and friends about why you aren’t purchasing gifts, so it won’t come as a nasty surprise to anyone.
15. Cleaning Products
Wipes, sprays and powders designed to clean surfaces and fabrics in the home can create clutter in your budget. The good news is that with just a few simple ingredients you can make powerful and versatile cleaners. Here’s a guide to get you started.
16. Routine Car Maintenance
While routine car maintenance is important for the longevity of your vehicle, there are some creative workarounds you could implement. One idea is to go longer in between oil changes. While most car companies recommend getting one every 3,000 miles, experts argue that can be extended to about 5,000 miles, which could save you two or three oil changes per year if you drive 20,000 miles.
If you do need to take your car in, you should check sites like Groupon.com, which may offer discounts from local shops. Just be sure to check out their reputation before you leap and don’t be taken by “upselling” once you get there.
The average family spends about $2,000 per year on clothing ($167 per month), but you don’t need new clothes when you are trying to make ends meet. If you have to purchase an outfit for a special occasion or need something like a winter coat, check thrift stores first. If that doesn’t work out, consider Craigslist and ebay, but new clothing should be a last resort.
18. Entertainment (movies, bowling, golf, you get the idea)
When the average cost of a movie ticket is about $8, and bowling, skating, sporting events and other common forms of entertainment can easily cost more than $20 in a matter of hours, it’s no wonder that this should be one of the first expenses to cut. These are “wants” and don’t have any place in an emergency budget.
19. Organic Groceries and Brand Names
Of course we want to put high-quality food products into our systems, but if you usually purchase organic produce and meats, you might need to reconsider in times when money is tight. Opt for cheaper produce that isn’t certified organic. Avoid pre-cut options, which are more expensive, and stay away from brand name products, which will add costs to your monthly grocery bill.
20. Charitable Donations
Charity is important and a healthy budget includes giving to causes you care about. But when your back is up against the wall, you need to postpone the giving. Think of it this way: you’ll be in a better position to help others once you get back on solid financial ground.
There might some ways to work charity into your spending, though. For instance if you use Amazon for regular purchases (in order to save on gas and trips to the store) or other “needs,” you could try smile.amazon.com, which donates a small percentage of your purchase to the charity of your choice.
The remaining items are more drastic and will require more thought and consideration.
21. Student Loans
Here at Clearpoint we take student loans pretty seriously and encourage borrowers to repay aggressively if they are able. That said, it’s pretty easy to skip a payment here and there when you are in a pinch. The important thing is to call your servicer and explain the situation. More than likely, they will offer you a month of deferment if you haven’t used up your allotment. Just remember that interest will continue to accrue on the loan(s).
22. Car Payments
If your back is against the wall, you might consider skipping your car payment for the month. The important thing here is to call your lender and ask first. Usually if the account is in good standing, they will grant you a month of deferment and allow you to miss the payment without any impact to your credit (they even run promotions like this during the holidays). That said, this will lead to increased interest and thus a higher total payment in the long run, and could include some other fees. If your interest rate on the car is significantly lower than other outstanding debt you have, like credit cards, then this might be a viable and smart option for you.
Like we said with medical bills, we would never encourage you to miss a payment. But consumers should know that a missed utility payment likely isn’t the end of the world, particularly if they communicate their financial difficulty. It’s usually only after several rounds of past due notices that a utility company would report an account to collections.
Call the utility company to notify them of your hardship; be prepared for small late fees on your next bill and then get your finances in order so you can make the payments moving forward (including double-sized payments the next month).
You can also see about qualifying for utility discount programs in your area if your hardship is going to affect your future ability to pay, too. Or, if you’re struggling in a month of high usage (such as during a cold winter) you might be given the option to average your bills and pay back some of the extra in a different month.
This one is pretty similar to utilities in the sense that a missed payment will bring about late fees but otherwise may not hurt you. Just keep in mind that it will be reported to collections after an extended time and after other notices have been sent.
The one difference here, though, is that utilities are needs and cable is a want. While you might have to fork over a contract termination fee, it could be much cheaper in the long run to cut the cord. Consider switching to Netflix or just using an antenna. You will save upwards of $780 per year.
25. Gym membership
The effects of a missed gym membership payment will vary by company. But in general the process is similar to cable and utilities: you will get hit with a late charge, and if your bill goes unpaid too long it will be sent to collections.
And like with cable, you might find that there are contract termination fees, but you might be able to avoid those if you explain your situation. And if your hardship is long-term, it may make sense to bite the bullet and avoid having to pay for the service on a monthly basis moving forward.
What didn’t make the list
You probably noticed a few things that weren’t on our list. One is credit cards, because of their high interest rates. You can’t afford to skip those payments and have your debt growing at a rate of 15 percent or more. And of course, you don’t want to jeopardize your living situation, which is why rent and mortgage payments aren’t optional.
Hopefully this list will help you cut some costs from your budget. And if you want more help, try our free budget and credit counseling. Our counselors are experts when it comes to suggesting ideas for cutting costs and increasing income, and they can help determine whether you can also save interest on your credit card payments in a debt management program.