First Person: Reducing My Discretionary Spending

Yahoo Contributor Network

There are bills I have to pay for every month. I consider my mortgage, utilities and groceries to be essentials. Yet, there are plenty of little luxuries I pay for on a daily basis. Purchasing extras that I don't really need is otherwise known as my discretionary spending. According to, "life's littlest pleasures" can really add up. In fact, during the course of your career, a daily latte habit can cost you more than $32,000. I used to spend more money on non-necessities such as manicures, gourmet coffee and hair cuts. However, with a little restraint I have cut my discretionary spending by at least 50 percent.

Kicking the Habit

Daily or even weekly habits can really add up. In fact, as the Forbes article stated, if you spent $7 a day (during weekdays) on lunch, this would add up to $1,820 a year. This doesn't mean you have to stop going out to lunch. However, going out to lunch only once a week would save you over $1300 a year. While I have never had a daily habit, I used to get coffee several times a week. I'm currently not even drinking coffee but will occasionally get an iced tea. I spend less than $5 a month on this "habit" compared to the $16 I used to spend.

Reducing the Frequency of my Luxuries

Despite reducing my discretionary spending, I still indulge in little luxuries. However, I used to get my hair done once every two months. I spent $40 a month for a manicure and pedicure. Now, I dye my hair at home, trim my split ends and do my own manicures. I still like to get professional beauty services. However, I have reduced the frequency of my salon visits. In other words, I only get my hair done three times a year and my nails done twice a year. Each time I get my hair done it costs $130. A manicure and pedicure runs me $40. Thus, each year, I spend about $500 on my hair and nails. I used to spend closer to $1200. I could do better but, for the time being, it's an improvement.

Eliminating Some of My Extras

While I have reduced my discretionary spending in some areas, I have completely eliminated other "extras." For instance, I used to pay $100 for my cable package. Now, I pay about $16 for movie and T.V. show streaming services. This saves me over $1000 a year. If we continue to go without cable, we could save at least $30,000 before retiring. That's a lot of money.

By reducing my discretionary spending, I can put my money to better use. I can put it into a Roth IRA, a 529 plan or into my emergency fund. And, it never hurts to reduce my unnecessary spending even further.

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