The Plan with a Capital P

This year we want to save money in an emergency fund, pay off our credit cards and reduce our debt by $10,000. In order to do this, we have had to make some changes in our lifestyles. Here are our major expenses in order of amount per month:

1. Eating out
2. Childcare
3. Mortgage (yes, childcare is more!)
4. Student loans
5. Credit card payments
6. Savings
   
7. Insurance (life, auto, medical)
8. Utilities
9. Groceries
10. Entertainment (other than eating out)

Did the "eating out" jump out at you, above mortgage and childcare? Yes, eating out. We usually eat out 3-4 nights a week, plus we have been eating at restaurants during lunch. SH and I each spent $50/week on restaurant lunches, plus another $150 a week eating out as a family. That's a monthly total of $1000 spent on restaurants. Not only have we packed on the pounds from constantly eating in restaurants, we have spent enormous amounts of money while running up credit cards. Why?

My parents always eat out. I don't like cooking when I get home from work. It's convenient. We're foodies, so we don't eat out at fast food -- it's a real restaurant or nothing. I feel guilty about spending money on nice clothes or shoes and can't bear to spend $25 to get my nails done but food is a staple, right?

Oh, the reasons. The reasons.

I have limited us to $75 a week for eating out, period. That means one reasonable family dinner and one lunch apiece.

This has been a huge and difficult change for us. I was up until midnight last night, chopping and sauteeing. I just can't eat Rice-a-Roni; when we do cook, we make it from scratch. But I guess I will have to get over that with this new Plan. Or figure out how to do it faster.

In this article about a family scraping by on $150,000 a year (couldn't we all be so lucky?) this author makes this comment:

Some cutbacks, of course, will be necessary to accommodate your now lofty savings goals. Most people trying to break the paycheck-to-paycheck habit focus, as the Schuetts have, on the "latte factor" - the little luxuries (like a daily dose of java at Starbucks) that add up over time.

Don't fool yourself. Small economies are just that: small. If you're really serious about getting a handle on spending, you need to identify the big-ticket drains on your cash flow - and there are always one or two - and do what you must to plug those holes.

If you're honest with yourself, you probably already know what you're spending a small fortune on.

Clearly, we're spending a small fortune on the restaurant business. To the tune of $12,000 a year. That's a nice little savings account if I do say so myself. We'll see how much we can keep by the end of 2007...