It's in the Details
A latte on the way to work. A take-out meal on the way back. A dress you saw on sale in a window at lunch. Drinks with friends that turned into a three-course dinner. Before you know it, you’re tapped out and left wondering: Where did all the money go?
It’s easy to succumb to mindless spending when your mind is on other things. (And when you’re juggling work and family and friends, when is it not?) But how might your spending change if you had to keep track of every expense? DailyWorth challenged three women to chart their discretionary spending for a week--basically anything that wasn’t a recurring expense (think: mortgage, utilities and childcare)--then try to cut it in half the next. Here’s what happened. Keep reading.
Michelle Morton, 43, Raleigh, N.C. Self-employed professional organizer, married, mother of three
Spending, Week 1: $568.42
Spending, Week 2: $400.04
Savings: 30 percent
How She Did it: In week one, Michelle realized she’d spent $175 on eating out. So in week two, she focused on cutting that by more than half, to just $75. Cooking at home for her family took more planning and effort, but it led to a pocket-book payoff.
A-ha Moment: Logging her spending daily saved Morton from the greatest budget-buster of all: Surprises! “What would happen previously is a few days would go by and I’d enter my receipts and I would be like, ‘Are you kidding me?’ It’s $4 here, $10 here and it doesn’t seem like that much but then when you go to put the receipts in it’s like, ‘Oh my God.’” Updating her checkbook daily gave Morton better control.
What She Learned: Being accountable to someone else (in this case, DailyWorth) for a week made her much more mindful of what she spent her money on. Going forward, she’s planning regular check-ins with her husband, in the hopes that could have the same effect (on each of them). And she’s going to try to stick to a budget. “Really what needs to happen is to say ‘This is what we’re going to spend on groceries this week’ and when it’s gone, it’s gone,” she says. “And ‘This is what we’re going to have to spend on eating out,’ the same kind of thing. I have to stop telling myself that although we really won’t save any money this month we’ll make it up next month because that never happens.”
Meieli Sawyer, 29, Miami. Communications Specialist at an advertising agency, single
Spending, Week 1: $572.28
Spending, Week 2: $137.59
Savings: 76 percent
How She Did it: In week one, Meieli went crazy at a sale at Talbot’s, buying $386 worth of clothing--most of which she realized she didn’t need. (She returned all but one $50 dress.) In week two, Meieli snubbed the retail chains for a local second-hand clothing store. She nabbed a dress and pair of ballet flats for $7 total (using a $10 store credit).
A-ha Moment: Because her job involves a lot of client meetings, Meieli is expected to dress well. But by remembering something her parents taught her, she realized she can save money on clothing without sacrificing quality. “When I was a kid, my parents always took me to secondhand stores,” says Meieli. “They wouldn't let me buy new stuff because they always said I could get higher quality things for less, and it's completely true. That's the only way I can afford to dress like I do and still have money to pay my bills, and save, because I do like clothes.”
What She Learned: Meieli and her friends often rotate who picks up the check during their regular lunches. But that can be a big hit to her weekly budget. She realized she needs to be honest with her friends about her attempts to cut back on her spending and suggest other ways to handle the bill such as going dutch. “I understand being thrifty, but you walk a fine line, and you don't want people to talk about you and say you're cheap,” Meieli says. “So I’m just going to try to say, ‘Look, things are tight for me right now.’ I’m going to try and not be embarrassed about it.”
Lucia Mancuso, 36, Toronto and New York City. Owner, The Blog Studio, single
Spending, Week 1: $795.25
Spending, Week 2: $626.80
Savings: 21 percent
How She Did it: Lucia learned she could have fun without spending a lot of money. In week two she attended a free yoga marathon that she loved, and spent only $50 on a Saturday night dinner and movie. Both left her feeling as if she’d had a great weekend without leaving her with a Monday-morning spending hangover. That helped her cut her dining and socializing spending in half, from $238 to $114. This savings made her realize she needs to get more creative when hanging out with friends. “I live in the city, and going to dinner is just how you hang out,” she says. “I need to suggest other things like going for a walk or to the beach instead of always having a fancy dinner someplace.”
A-ha Moment: Lucia realized that by being so busy with work and her social life, she wasn’t making the time to be organized about her spending. “I realized that if I can’t control my spending, I can’t control my life,” says Lucia. “I can’t control my health and my weight and my business -- all of it.” For example, by not making time to clean her kitchen, she realized she was much more likely to order in rather than come home and want to cook. By not making the time to prep meals or prepare snacks (she used to have a $15 a day kombucha drink and kale chips habit), she was costing herself more money and sabotaging her desire to pay down her debt. “I need to leave enough space in my life for me,” she says.
What She Learned: “I think we interpret being financially free as being free spirited and not thinking about money or finances,” Lucia says. “I realized that when you have your finances and savings under control, that’s when you really have the freedom to make all the choices that you want in life.”
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