I’ve been running a debt-free Instagram account since early 2017. I have talked to hundreds of people and gathered thousands of bits of data on where people are struggling the most with their spending.
Plus, I know from my own experience!
These are the most common places people tend to overspend. If you’re needing to cut back, these are definitely the areas to evaluate first!
The Top 6 Areas of Overspending That You’ll Probably Need to Cut Back in First
Grocery spending is one of the first places people tell me they are overspending. It’s also one of the top expenses in most of our budgets, so the overspending can make a significant impact. If you are wasting food or spending more than you can afford, cutting back on the grocery budget can help you make big progress. A good meal planning strategy can help immensely in spending less on groceries every month.
The average American household spends $3,189 every year eating out! That comes out to $265 per month. Eating at home more often and cutting back on eating out can save huge bucks. It’s also healthier and better for the environment. Packing your lunches for work, making your own coffee, and making sure you have groceries at home so you aren’t tempted to go out to eat are some great ways to start cutting back.
Shopping for new clothes is the most tempting thing there is! Why? Because nothing distracts us from our real problems more than buying new clothes that make us feel fabulous! However, when cutting back on a budget, extra clothes might need to get cut out. I’ve heard we only wear about 20% of our closets anyway, so it’s time to simplify and stop buying clothes because they are cute and only buy them if we need them. No more perusing your favorite clothing stores and buying whatever looks cute. Clothing purchases need to be properly budgeted for and planned out.
Makeup, hair care, nail maintenance, waxing, facials, oh my! As women, we feel so compelled to take part in anything that will make us feel more beautiful. However, beauty is incredibly expensive and simplifying your routine by cutting back on anything you can live without for now will save you big time. This could mean waiting longer between haircuts, going back to your natural hair/color, doing your own nails, waxing yourself, and so on. You can save a lot of money by DIYing as much as possible, too!
It’s easy to blow money on fun! Unfortunately, entertainment costs rack up fast. For example, if I want to go see a movie with my husband and three kids and enjoy some refreshments, the bill would be around $60! If we were to go out and do things like that every week, we’d be spending hundreds of dollars that could be put to better use elsewhere. Entertainment is an easy area to cut back in because there are multitudinous ways to entertain yourself and your family for free.
Miscellaneous expenses are things that come up during your month that might not be recurring in other months, so they are a little trickier to plan for than regular expenses. Miscellaneous purchases can be anything from school fees, to holidays, to needing a new shelf for the garage. Random things do come up. Be as specific in your budget as possible each month to avoid miscellaneous and impulse purchases eating up all your cash. The more specific you are, the less likely miscellaneous expenses are to sink your ship.
If you’re still trying to figure out how to even set up a budget, check out my full run down on how to set up a budget today! I also have a free budget template you can use. I’ll show you exactly how I’ve been budgeting for the last 3 years (and we’ve paid off $70k of debt while following this zero-based budget method). Happy budgeting!
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How We Paid Off $71k of Debt in Less Than 3 Years on a Single Income
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The 7 Steps to Paying off Big Debt
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