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Living Below Our Means Has Saved Us From Financial Disaster

Living well below our means has saved us from financial disaster several times over and has kept financial stress at bay. We would not be where we are today without living by standards we set for ourselves early on.

What does living below your means mean?

Living below your means does not mean living on beans and rice or driving a car set for the junkyard. It simply means monitoring and cutting spending where possible. Saving money and spending carefully are important components. Often it involves making sure you get the best possible price for something. Other times, it means evaluating your wants versus your needs and deciding not to spend the money at all.

You are probably already on the right path to living below your means if you are here. However, here are some of the best wasy to live below your means:

1. Never pay retail!  Get the items you need at a fraction of the cost by using coupons, shopping sales and combining the two!

2. Buy used cars and keep them for a long time. Buying used cars even with just a few thousand miles takes of thousands of dollars. Keeping your car well serviced and keeping it for a long time will give the most bang for your buck.

3. Plan and cook meals at home. Eating out can eat away at your budget. Save by planning your meals and eating at home.

4. Don't use credit cards unless you can pay them off immediately. Using credit cards requires self control. If you can't control what you spend on a credit card, get rid of them.

5. Don't take out loans. Save for the items you need and pay them off immediately.  If you must take out a loan, do it very short term.

6. Be careful what you pay out in monthly bills. Monthly bills can wreak havoc on your bottom line. Do you really need that cell phone and a land line? Does your cable package really require all those channels? Take a long look at what you are paying monthly and learn to weed out the things you don't need.

7. Eliminate monthly spending in areas that are not necessary. Do you really need daily trips to the coffee shop or fast food restaurant? These things don't appear to be huge until you actually add them up. Other unnecessary items may be soda, tobacco products, and junk food. You'll be healthier without them too!

Everyone will have different priorities as to what they can live without. At my house we live very well and don't even come close to spending 50% of our income. A very large percentage of our income goes to our savings and investments each month. But that doesn't mean we are not constantly looking at ways we're being wasteful.

Living below our means has given us an enormous amount of financial security. Having financial security has put us in a stress-free situation when it comes to finances. Not having enormous monthly bills has saved us from financial disaster several times and we are quite aware of that as we move forward in life. We've conquered major surgery, cancer and job loss, without having to dip into our savings.

How are you living below your means?

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Anonymous said...

Extremely impressed with the last 2 paragraphs! Way to go!

Aimee in NC said...

This is our ultimate goal. I hope to see more about how you made it there.

Our economy is not in tip top condition and it should be the goal of most to eliminate debt and have a savings.

Thanks for the inspiration to get there.

momma-lana said...

We are living pretty much like your family. We recently went through 9 months of unemployment and were able to live very comfortably through that time because we had an emergency fund.

We surely quailfy for cutting expenses in the vehicle department! Ours are 11 and 12 years old. We paid cash for them many years ago and we take care of them. They are certainly not like driving a new car but they run well and are reliable and the A/C and radio works. We have a good old boy mechanic only 2 miles away who keeps them on the road for us :)

We learned our lesson about credit cards and debt in the eary years of our marriage and will not go there again!

Anna said...

That was a great and timely story, thank you for sharing it with us.

Bonita12 said...

Thanks for sharing - very inspiring! My husband and I are currently working the baby steps in Dave Ramsey's Money Makeover Plan.


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