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The Simple Way to Determine WHAT to Cut from Your Budget

This post may contain affiliate links. Please see my full disclosure policy for details.

October 31, 2016

31 Oct
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If your budget is not quite looking as you would like for it to, it may mean that it is time to cut back on some things.  The question that is often asked is “How to do we know WHAT to cut?”

What to cut from your budget - she breaks it down and makes it easy to follow. Even I can do this!

If you are like most people, you look at your budget and believe there is nothing at all you can cut.  You have tried to move the numbers around time and time again, but end up with the same result — not enough money to cover your expenses.

This leads to a lot of stress and worry.  How will you pay the mortgage?  What about food?  And the credit cards?  No way can you pay them.

Read More:

  • Determining Wants vs. Needs
  • 6 Reasons Why You Will Fail at Getting Out of Debt
  • How to Stop Living Paycheck to Paycheck

You know you need to make changes to the budget, but how do you decide WHAT you should cut? Follow these steps to find out what you need to have in your budget.

Before you get started, make sure you have a workable budget. Before you know what to cut, you have to see where you spend.  Download your free form by filling out this sheet.  Then, read our post on How to Create a Real Budget, so you can have your ducks in a row before you start those cuts.


 

Cover Your Living Expenses

The first thing you need to do is make sure your living expenses are covered.  These include items such as rent/mortgage, utilities and food.  These are the musts.  You might be able to cut back a little on your food budget, but in many cases, you’ve already done that.

 

Pay Your Creditors

Next, add the payments you need to make to your creditors every month.  This includes medical, vehicles and credit card debt.  Only list the minimum required payment at this time.  You want to make sure your basic budget covers all of your required expenses.

 

Determine wants vs. needs

Now that you have your basic expenses all covered, you next have determine which items you really need vs. those you “think” you need.

For example, if you have dining out in your budget, that is not a need.  That is truly a want.  You may have clothing in your budget.  That is a need — but you might be able to lower the amount you budget for those clothes for the kids (shop consignment and/or sales to stretch your dollar).

When my husband and I were getting out of debt, this is the exact thing we did.  We created a brand new budget.  The first items we listed where the things we needed in order to live.  We then added in the few debts we owed.  Finally, we looked at how much money we had left to spend and decided which “wants” we would like to add back in and which we were willing to give up, just to have additional money to pay off our debt.

It was a challenge for us too. I did not like it. However, by doing so for just a couple of years, my husband and I were able to eliminate our debt.  Now, money is something which does not cause us stress. Our budget is simple.  We never worry about paying the mortgage nor putting food on the table.

When it comes to your finances, there are times when you have to make tough decisions.  We all have the things we want, but if you are having financial struggles, you will have not choice but to cut back wherever you can.

Small sacrifices now can pay off with huge rewards later.

How to figure out what to cut from your budget

How to create a budget | Saving Money | Budget | Get out of Debt |  Budget Tips | Budget Printable

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Tracie Fobes, Owner
I'm Tracie! Several years ago, my husband and I found a way to work ourselves out of more than $35,000 in debt. As a result of our journey, we now help families learn to do the same. I share my tips on life, family and finances - to help others achieve this same goal of living a debt free life! Learn more about me and my family HERE.
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