On a day-to-day basis there are different expenses that you have to face, such as paying for transportation, food, clothing or housing; while there are others who provide us with certain satisfactions or well-being.
Unnecessary expenses are all those that you can do without without affecting your basic needs, however, they are different for each person, since each person’s situations are unique.
Therefore, the first thing you should do is identify which ones are yours . These are divided into two types: fixed and variable.
The first ones refer to all those that you have to pay month after month, for example rent, transportation or the payment of some insurance or loan.
The latter, as its name implies, vary each month, depending on the needs you have to cover, that is, food, clothing or payment for certain services.
Both in fixed and variable expenses you can make adjustments, some you can eliminate and others reduce, so it is important to have them all identified.
Once you have your expenses classified, there are some strategies you can use to decrease them:
Fixed costs. These are a bit more difficult to modify, but not impossible. For example, if you drive to work every day, one option would be to take public transport for a couple of days or share it with a co-worker or neighbor who takes the same route.
If you pay any credit, seek to refinance the debt or look for another that has less interest. Remember that the longer you pay a loan, the longer-term cost is higher.
Variable expends. First identify which are basic to living and which are the tastes that you give yourself every day. If you eat out daily, one option is to cook a few days; If you go out once a week with your friends, the activity can be changed to a meeting at home.
Another option is to review the services you are signed up for. Instead of paying for the most expensive phone plan, you can opt for a lower one, especially if you do not consume everything that the plan includes.
This type of expense refers to those small amounts that you leave daily without realizing it: a pack of cigarettes from time to time, a daily soda, a coffee a week or an occasional movie going out.
It also includes many of the digital services that we have acquired over time, such as pay-per-view or streaming music, premium service subscriptions, and more.
At first, it doesn’t seem like you spend a lot of money and that is why they are so dangerous, because they can affect your budget without you noticing.
If you decide to cut just those expenses, with what you save in a year, you could go on vacation without worry or buy a new computer. Even reducing them by half, already represents a saving.
Finally, remember that it is not about depriving yourself of everything and living in austerity, but about setting priorities . You can enjoy many of these things, but it might be worth considering not doing all of them at the same time.