Photo courtesy of GoldenEel
Yes, you read that correctly. Could you live on $800 a year, excluding utility bills, clothing, gifts, car, and house? Your reaction is probably like mine – what’s left? Well, a lot, actually. Consider how much money leaks through your budget on things like food, pet food, entertainment, and other miscellaneous categories.
I stumbled across a blog post at Jane4Girls $800 Annual Budget that proves it is possible to live on an $800 annual household budget (by “household” I mean things like food, cleaning supplies, health and beauty supplies, etc.). Here’s an excerpt from her site which explains the mechanics behind how she pulls it off:
I have basically put $800 cash into an online savings account. This is for 4 people, one adult, 1 teen, two tweens and two dogs. This averages out to 54¢ per person per day. Any time I have to pay out of pocket for something I will use a credit card that I earn rewards on, either cash back, gift cards back or college savings. Then I will transfer that purchase amount from my online account to my checking account to cover the cost of those items when the bill comes in.”
It is hard to believe a mom and three kids (and two dogs) can really live on $66.67 a month, but when you really dig in to Erin’s system you find that a lot of what she uses has been stockpiled and/or acquired by combining store sales with coupons. That is a great strategy, and one we tried last year after signing up for the Grocery Game. The service published a list which matched up store sales with available coupons from the Sunday paper (and a few online sources).
During weeks we stuck to the game we saw some significant savings, usually around 35% off regular, retail grocery store pricing. However, we also found ourselves buying a bunch of stuff we didn’t really need, just because it was a “rock-bottom price.” As the stockpile of unused stuff began to grow we realized that stockpiling wasn’t working for us because we bought more of the things we didn’t need and that offset the savings of buying the things we did need.
It is an interesting exercise nonetheless, to imagine just how low you could go on annual household spending. Without knowing much more about Erin I assume she is doing this because she has to, and we are fortunate that we don’t have to mind our pennies quite as closely. I would rather spend a little more on things like food to eat healthier meals, more fresh produce, etc. rather than always hunting a coupon bargain.
Still, there are some opportunities for us to cut costs, and use more coupons on the foods we do buy, particularly basic staples. I get bored too easily to track spending at such a granular level for an entire year, but I might just try something similar for the month April. Stay tuned.