Dollars and Sense
by Cheryl Gochnauer
(KANSAS CITY STAR, 2/4/99. Copyright 1999 Cheryl Gochnauer)

Rethinking the family budget pays this mom to stay home.

"I wanna go home!"

Nope, that's not a kid wailing; it's me, four years ago. Like many women, I dreamed of putting my professional skills to work on the homefront, spending more time with my two daughters, Karen and Carrie.

Unfortunately, today's families can't live decently on one income. Or at
least that's what I used to think, until I did the math and realized that,
after subtracting all the expenses connected with my job, I was clearing $39 a week.

Wait a minute - that's less than a dollar an hour!

I decided the buck wasn't worth it. I gave my notice. I cut all the
expenses - childcare, clothes, etc. - related to work and surprisingly found a ton of other areas where we could save.

HOW'D YOU FIGURE THAT? First of all, I sorted out our haphazard accounting system, which basically consisted of all those bills, pay stubs and little slips of paper stashed throughout the house.

Going back a year, I used the checkbook, savings account record and receipts to figure fixed expenses like mortgage payments, installment loans, insurance and daycare. Totaling fluctuating bills, like utilities,
groceries and credit cards, I came up with a monthly average. Discretionary expenditures like eating out, entertainment and mad money were also tallied.

As the calculator clicked, a clear picture of our true financial situation
emerged.

Subtract childcare for a toddler and a first-grader; take away the
successful working woman car payment and gasoline/maintenance costs; figure in a daily $5-and-up lunch with co-workers, as well as dinners I was too tired to make; subtract dress-for-success clothing; bump me into a higher tax bracket - and there I was: a second-string breadwinner bringing home nothing but crumbs.

Getting a handle on exactly where we were financially allowed my husband, Terry, and I to make some radical decisions affecting our family life. Here are concrete budgeting steps we took, with our family's actual savings noted in brackets.

Any one of these suggestions may make you say, "Gee, that's a lot of work for such little return," but keep reading. Consistent cost-cutting over the broad scope of your finances can reap significant rewards.

A SECURE FOUNDATION. Our home was our biggest expense, after childcare costs.

We dropped our mortgage payment 20% with a no-cost refinance. [$150/mo.]

A home equity loan paid off all our credit card and installment loans,
plus financed some remodeling (which kept us from shopping for a bigger house). Interest is tax deductible, and we pay one lower total bill instead of four. [$90/mo.]

Taking advantage of my more relaxed, at-home schedule, we painted our own house. [$1,500]

Level payment plans protect us from wildly fluctuating utility bills.

ROAD TO SUCCESS. Do you realize that, for the cost of one new $16,000 compact, you could buy three or more dependable used cars?

We found the proverbial little-old-lady's car for $1,500 - 20 years old,
but with only 52,000 miles and in mint condition. Selling our nearly-new
luxury car, we sped away in our paid-off classic. [$400/mo.]

With no car loan, we only have to carry liability insurance. After
raising deductibles on life and homeowners policies, we chose a
comprehensive medical plan limiting out-of-pocket expenses. [$100/mo. in premiums and medicine costs]

LOW-FAT DRESSING. Why pay $30 for a pair of pants when I can find
gently-worn jeans for a dollar at my neighbor's house?

I sift through a lot of dirt looking for diamonds. But then I'll hit that
primo garage sale with the perfect size clothes and toys to please my kids.  After Karen and Carrie outgrow them, I sell the same items in my own garage sale. [$40/mo.]

I wash most "dry clean" clothes in gentle soap made for delicates.
[$20/mo.] 

Buying next year's coats at this year's end-of-season sale saves big
bucks.

CUT OUT CREDIT. Carrying multi-credit cards is a bogus status symbol. We kept one no-annual-fee VISA for emergencies, and cut the others up.

We switched to no-cost checking, and save 60% buying mailorder checks. [$15/mo.]

Eyeing special promotions, we take stores up on their price-matching
offers. If a purchased item goes on sale within 30 days, I take my receipt to the service desk and request a refund of the difference. [$40/mo.]

Using doubled coupons and discount shopper cards, I average 30% in savings whenever I visit the supermarket. [$130/mo.]

When buying from commissioned sales people, we cheerfully haggle for the best price.

Rebates are well worth the minor hassle of picking up forms and sending in proofs-of-purchase. The combination of a sale, coupon and rebate often works out to a free product PLUS cash in your pocket. [$30/mo.]

CHEAP CHAT. I don't put a stamp on any letter I can deliver myself.

Whenever possible, we e-mail rather than calling long distance or sending cards. Timely packages are shipped priority vs. overnight mail. [$40/mo.]

Purchasing a year in cyberspace in advance, I locked in an $11.95/mo. rate when many friends were paying $19.95. [$8/mo.]

I canceled subscriptions for periodicals my local library carries. [$10/mo.]

FRUGAL FUN. Curb those entertainment expenses!

Trade baby-sitting with friends. [$40/mo.]

Going to a matinee instead of a primetime show slashes our movie costs. Renting videos saves even more. Microwave popcorn and a two-liter ring in under $3, vs. $12 for comparable movie treats. [$30/mo.]

"Buy one, get one free" coupons allow us to quickly recoup the cost of Entertainment and Gold C books. [$20/mo.]

Networking with family and friends, we barter skills. Additionally, we've
saved money by learning to do our own taxes, maintain our own automobiles, and make our own household repairs.

If you go back and tally up our family's savings, you can see we managed to cut our monthly budget by over $1,000. Add the $960 a month we saved on daycare when I quit my job, and we're talking serious cash.

The secret to pruning a budget is mastering the ability to separate wants
from needs. Sort through your own stack of bills and receipts. You may
discover the elusive key to stretching your money - whether you make $15,000 or $50,000 - isn't buried as deeply as you think.

Now, what will you do with your newfound treasure?

Comments?  E-mail Cheryl at cgochnau@sky.net, and visit her website at www.homebodies.org.  Her new book, “So You Want to Be a Stay-at-Home Mom,” is available at your local bookstore.  Or ask your library to carry it! Copyright 1999 Cheryl Gochnauer.

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