Tips For Living Within Your Means…Painlessly!

Budget-expensesThis post is from Jerry Coffey at Enjoy!

Living within the confines of your income is the best way to keep yourself out of debt, or at least hold your debt to a manageable level. Now that I have written that down, everyone will magically be living within their means in the morning, right? Maybe in cloud cuckoo land. Here are a few tips that may help you find a way to live within your income and begin repaying some of your debt.

Where Does It All Go?

In order to live within your income, you have to know how much you make and what all of your expenses are. A good place to start is to know what all of your fixed expenses are. Fixed expenses are items that you cannot change immediately. Little nagging expenditures like rent/mortgage, car payments, etc. Subtract that amount from your income and you will know how much you have available to commit to your variable and discretionary expenses or pay down debt.

Become a Tracker

Not of wild game, but of your expenditures. This is the first step in forming an effective budget. We all have areas where we spend money them forget we spent it. This is usually an area that gets out of control and throws us off our budget or puts us in a situation where we may not have all of the cash for a fixed expense when the due date comes around. Once you have tracked your cash outlay for three or four months, you are ready to start forming a solid budget. There are dozens of online tools and spreadsheets available to help you, and I’ve gone over my personal low-tech process for tracking expenses here on

Wants vs. Needs

One of the quickest ways to get into overwhelming debt is to confuse wants and needs. In our consumer driven society it is often difficult to separate the two. When you have an item in hand, ask yourself if you really need it. If you cannot readily answer the question–if it is not a quick and simple yes–put it back and go home. Think it over for a day, or even 72 hours. If you still think you need it, go back to the store. In this way you take your emotions out of the equation–a big part of how people end up in debt.

Pay with George

The best way to avoid debt is to buy everything possible with a stack of George Washingtons, or a few of his buddies Hamilton and Franklin. Adopting a cash-only lifestyle can save you tens of thousands of dollars over your lifetime. Look at a television for example. Cash price is $800. After sales tax it is around $864, depending on where you live. Now, put that on your credit card and carry a balance for just one year and the price goes up to around $1010, assuming that you only make the minimum monthly payments!

Save Where Possible

You have direct control over many of your discretionary expenses and a modicum of control over fixed expenses. Little things like changing the thermostat by two degrees, shopping around for all of your insurance needs, and buying a less expensive car can save you a hundred dollars or more per month. Other areas that are easy to cutback in are your grocery bill, furniture, electronics, and clothing. A simple list has been proven to save a person at least $25 a week at the grocery. Buying secondhand furniture and electronics can save $50 or more per transaction. Just buying last generation electronics can save you a ton. I never buy any clothing that isn’t on sale. My children have learned to look for the clearance rack first when we shop.

Never Go Without

This last tip is essential, you cannot deprive yourself. If you feel as if your budget is preventing you from living your life in an enjoyable way, you will stop following it. Your budget has to include some sort of reward or entertainment provision. You may even be able to save money while entertaining yourself. If you like to go out to eat, why not have friends over for a cookout instead? If they bring a dish, you get to save money compared to a restaurant and hang out with your friends. No one is deprived, including your wallet.

Have you got some other tips for living painlessly within your means? Let us know!

Jerry Coffey successfully paid down more than $10,000 in credit card debt through sound money management and the adoption of a frugal lifestyle. You can read more of his thoughts, insights, and ramblings over at


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  1. We recently started using cash for our food/gas budget again. We felt like those catagories were getting out of control because we weren’t tracking them closely.

  2. Tracking my money made the biggest difference in how started managing my money. I didn’t realize how hard it was to make a budget when you didn’t know what you were actually spending money on. Once I figured that out, everything else just sort of fell into place.

    1. You are so right John. Also, when you start tracking your money, you can be surprised where some of it goes. When I started tracking my expenditures, I was surprised to find that I was spending around $200 a year on chewing gum.

  3. I’m a firm believer in tracking now, even though I didn’t think we needed it before or I had no time to do it! That’s the lifesaver we needed, and yet so freakin’ simple.

  4. Tracking my money – income and expenditure has changed my finances…for the better. We assume we know wehere our money is going, a few months of tracking shows us where it is really going…some expenses over time come as a shocker!
    It has helped me cut down on some unnecessary expenses and the income reports pointed to ways I can bring in more. Happily living within my means 🙂

    1. Simon, it really is essential. My mother’s parents gave her a small notebook to track all of her income and expenses from the time she got her first job, and I think it was such a smart move. I think a lot of the anxiety/pain that comes with trying to live within your means comes from that lack of KNOWING where the money is going. If you’re on top of that aspect, the rest isn’t so tough.

  5. Tracking your spending is essential. I’ve been doing it for two years now and it’s been very beneficial for my wife and me. I think an important point to make is that tracking your finances and getting your finances in order takes time. It’s best to designate time each week or month to put towards it, otherwise you’ll always be “too busy” to do it.

    1. DC, so true. I think the “too busy” mentality is one of the biggest reasons that people not only don’t track their expenses, but don’t end up achieving their financial goals. You have to dedicate the time to it that it deserves.

  6. I am a big fan of the reward system, but keeping it aligned with the goals that you are accomplishing. When I hit smaller goals, I may allow myself a mani/pedi or something and when I hit larger goals, it might be dinner out or something like that. Rewards definitely give you the energy to achieve your financial goals since it is usually a long journey.

  7. Somewhere I read, if you want to discourage yourself from spending add a zero to the cost of the item. So if you are looking at a $40 item, ten years from now that $40 if invested could net you $400…or something like that…anyhow…I use it all the time and it helps me!

  8. As Jerry said, the best way to save money for me is having a cash-only lifestyle. Credit card is a just a plastic, so the debt will be in the future and we don’t worry in the buy moment. But when paying with cash, it impacts inmediately in our current budget, so we will have more prudence.

    1. Well said, Diego. I even think there’s something more satisfying about having and spending cash versus using a credit card. It feels healthier, as there is no debt building in the back of your mind, even if you know you’ll pay your credit card balance at the end of the month.

    2. Diego, I have been recommending cash only for some time. One thing I forget to mention at times is how hard it is to switch to it. I would like the readers here to expect some very real depression in the beginning, but know that it will pass and your life will be better afterward.

  9. I have this concept called the make or break number that basically live by. It’s the number you need at a minimum to fund your necessities- including a buffer, emergency savings, and retirement (As those should be necessities). You have to bring at least that much in income each month to hit the make or break. Anything extra can be used for discretionary expenses.

    1. Stefanie, that’s so smart. I think everyone should know their make-or-break number, but so few of us actually do. For those of us especially with non-salary income, either from wages or freelancing or a business, I think knowing this number would alleviate a lot of the anxiety that comes irregular income.

  10. Great post! I’m tempted to try a cash only September, as much as I can, to see if it makes a difference; I suspect it would. Spending with cash seems so much more real then with a bit of plastic. We live below our means because we’ve learnt how to go without all of the stuff – our wants are definitely small. However, we do spend on good food and occasionally going out, so that it doesn’t feel like we’re depriving ourselves. All within budget though 🙂

    1. Nicola, you should indeed try the cash-only September. It’s crazy how much more aware you are of what you’re spending when it’s cold hard paper going out of your hand rather than a swipe of the plastic!

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