University of Illinois Extension

Strategies for Spending Less

Control Spending

When the family faces reduced income, take immediate action to stop all excess spending. Buy only what you and your family really need.

Studies have found that many families do not adjust their lifestyle for about six months after their income is reduced. That six months of ignoring the situation can make things worse. When you take charge of your financial situation immediately, you are making a positive contribution to your family’s well-being now and in the future.

Following basic money management steps can reduce stress and help you adjust to living on less income. Here is a list of research-tested strategies:

  • Make a list of the family’s most important expenses while you have less income. This means things you must have or do. Make a family spending plan by listing the amount you will spend in each category. This will ensure that you plan to spend less than you earn. Refer to Setting Spending Priorities, to develop a family budget.  
  • Spend according to your budget. With less income, each spending decision is critical. Tally up your expenses each week to make sure you are not over spending in any category.

When money is tight, most people give high priority to paying fixed expenses such as rent or mortgage payments, insurance premiums, car payments and installment debt. Flexible expenses such as food, utilities, clothing and household expenses can be more easily adjusted to fit your income. Plan to cut back on all the flexible expenses. If necessary to further reduce spending, see if you can cut back on the fixed expenses.

All family members need to work together to reduce spending. When everyone pulls together, you are more likely to succeed in reducing spending.

Together, the family should go through the following list of flexible expense categories. Check the ideas that would help your family reduce spending. Add your family’s ideas to each list.

As you go through the list, ask “How can we reduce spending?”

  • Can we substitute a less costly item?
  • How can we conserve resources and avoid waste?
  • Are there opportunities to cooperate with others by trading or sharing resources?
  • Can we save if we do it ourselves?
  • Can we do without?
1 | 2 | 3 | 4 | 5 | 6 | Next >>