How To Spend Less Without Noticing

I run a zero-base budget. What this means is that every single last dollar that comes in is given a purpose. This doesn’t mean that I spend it, just that it’s allocated. I have neither a surplus nor a deficit at the end of each month – in other words, a zero base.

From a financial perspective, this makes total sense. I’m putting my money to work. From a practical perspective however, it requires a lot of maintenance – I spend a portion of each week tweaking my budget to keep it at a zero base. Personally, I’m okay with this. I understand a lot of people wouldn’t be. Emotionally, it also has the drawback of making me feel like I’m permanently a bit short.

I am also very much an advocate of the “pay yourself first” concept. That is, every time you get paid (or at the beginning of each month, in my case) you put aside money for savings and investments. I’ll be the first to admit I have very aggressive savings/investment goals. So, when the need or desire arises to spend money on something I haven’t necessarily budgeted for in advance, I need to find money that I don’t really ”have”. 

Here’s how I do it without really noticing anything is missing:

1. Services - I’ve learnt over the years that many services we typically pay for are all about practice. Things like having your nails done or your hair coloured is just about putting the hours in. I can honestly say that I’ve never had anyone else do as good a job on a manicure as I can (and trust me when I say I’ve tried all price points). Getting the right tools and being prepared to put in the time to get it right can save you a small fortune.
2. It all adds up- I’ve said it before and I’ll say it again, small amounts of cash spent here and there can really add up at the end of the month. Don’t believe me? Have a look on your bank statement and see how many cash withdrawals you made last month. Going without whatever it is you’re frittering away your cash on can be tough though, so if it’s something you really need or want, find a substitute. For example, if you’re buying things in the vending machine at work – stock up at the supermarket on the weekend and keep a stash in your desk drawer.
3. Unused subscriptions- Often we convince ourselves that we need something we subscribe to – internet access, mobile phones and pay TV are all common ones. Whilst getting rid of it entirely is one option, just reassessing your usage is another. If you’re only watching one show on your premium level channels, why not consider downgrading your pay TV package and getting that show online or on video? Also look to see if the allocated bandwidth for your internet access is being used to the max and your mobile phone “included usage” is being fully exhausted. Downgrade accordingly. This doesn’t just apply to technology either – stuff like gym memberships can be cheaper if you only go on the weekends and newspaper deliveries are a fraction of the cost if you only read Thursday through Sunday too.
4. Utilities – Many utilities have an off-peak time. Have a look at your connection agreement and find out if yours does. (If not, consider switching). You can make interstate / international phone calls at cheaper times or set your laundry to run while you sleep.
5. Regular expenses – Reassess your regular costs to see if there might be a cheaper alternative. Say you drive to work. Ideally, you’d probably catch public transport, ride a bike or walk for the most cost-effective alternative. If these aren’t viable (or desirable) options, consider shopping around for different parking places. I drive to work one day a week. I recently found a different parking place only a little further from the office for $5 a day LESS than I was paying. Perfect! Other examples include gym memberships (is there another gym you could join for less, or will your current gym renegotiate?), a cheaper place to buy coffee in the mornings, or the option to subscribe to a magazine you usually buy at the newsagent.

By putting a few of these into practice, it’s often easy to find a bit of cash you didn’t really have without actually feeling like you’re cutting back. Nice.

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