Do you really need it? Cut Expenses for a Healthy Budget

Reduce Spending When the Economy Slows

Times are getting tough again. Every day I read dire news on the internet about the sky falling... or is that the stock market.  We all know that economies have cycles of growth and decline and it appears we aren't growing at the moment, so it is time to review your budget.

You do have a budget, right? This post is both for individuals as well as online businesses.  Hopefully up to now, you've made enough money to pay all your bills and save about 40 for emergencies, gifts, and entertainment.  If you have, you probably have enough savings to be safe until the economy recovers.

On the other hand, you may have found your online sales and marketing efforts declining and your savings have been disappearing, so it is time to cut back on spending.

Go through you list of both fixed and variable expenses and decide if they are essential or not. Mark the non-essential expenses with a check mark (tick for British folk :-) ).

For each checked item, determine whether you can replace it with something cheaper or do without.

Here are some examples:

• Suspend or cancel the second phone line.


• Cancel optional services like CallerID. Those can really add up.


• Move to a smaller office or have a home office instead of renting. A home office might require a little redecorating, but it would probably cost less than 2 month's office rent and from then on, you'll be saving.


• Move to a smaller apartment or look into buying if the monthly payments would be cheaper than your current rent.


• Rent your house or apartment's spare bedroom out.


• Cancel your cable or satellite television or at least cut back to the basic plan.


• Reduce your Internet plan to a cheaper one. Here, I pay a different rate according to the bandwidth I select.


• Check your heating and cooling expenses. Change your thermostat so that your heater or air conditioning run less. Run a fan by your desk on hot days.


• Disconnect appliances and electronics that you are not currently using. Many have a standby mode that continues to use electricity.


• Open your curtains and blinds during the day. Turn off lights that you are not currently using.


• Be sure to deduct valid business expenses from your business's taxes.


• Go to the public library instead of the shopping center.  Many purchases are impulsive. Look for something when you decide you need it.


• Pay with cash or check instead of credit. Studies show people spend more when they use credit cards.

I'm sure you can think of many more ways to cut back until your online marketing and sales improve. You might find that many of these changes will help you and your online business save money later on.