There was a story that went viral last year about a young couple that was determined to see how little they could live on each day. The project was called the One Dollar Diet Project. The couple managed to live an entire month off of just one dollar a day for food expenses. While this project was meant to shed light on the poverty that exists in the world, it also demonstrated the extremes of frugal living. Today I thought it would be beat to determine the minimum amount of money that it would take for you to live with only the bare bones essentials.
How much money do you need to live?
Housing costs are a total of the basic necessities that you need to live. This would include your monthly mortgage payment or rent payment. You would need to add in the cost of all necessary utilities like gas, electricity, telephone and water. Any housing related insurance fees and property taxes are also important to include. Leave out cable television and satellite television. Also, remove DSL and cable modem expenses.
Food costs would be a sum of the total of how much money it would cost to feed your family on a monthly basis. This includes meals, beverages, snacks, desserts, and all essential items needed for food preparation. Base this cost around if each meal each meal was prepared at home. Going out to eat is considered a luxury and not a necessity of frugal living.
Clothes are a necessity. Designer name brand clothing is a luxury. Monthly clothing costs would include any pants, shirts, dresses, shoes, and outfits that are needed for you, your spouse, or your kids. These items could be work related or for casual purposes.
Soap, deodorant, toothbrushes, toothpaste, toilet paper, and many other essential toiletries would fall in this grouping. If you really wanted to be frugal, you could make a lot of these products yourself. You can make homemade soap, toothpaste, detergent in just a couple of minutes. We do this and it works great. In fact, we prefer these products compared to what we can buy in the store. Although you can do this too, we will leave space in the budget for you to buy these items.
This is the category where cell phone bills, movies, electronics, video games, and the internet would fall. These things may make our lives a whole lot easier but they are not essential to living. This portion of the budget would be a big fat zero. If we are looking at frugal living then we want to eliminate these luxuries.
Now, figure out the costs for each of these items over a 30 day time period. Total up each category and this will show you how much you could really live off of if you had to. Your actual budget and your frugal budget should technically not be that far off from one another. If there is a big gap between what you could live off of and what you do live off of then I would suggest you start trimming some expenses.
So readers, after doing this, how big was your gap? Was this exercise enlightening? If you have made changes in your budget to spend less, what did you do? Please share.