Minimalist in DC

The Quest for Less "Stuff" & More Time

Tag: budgeting (page 1 of 2)

Get a Raise & Sneakily Increase Savings (Quick Tip)

Sneakily Increase Savings

In the first few months of my career, when my husband and I were fresh out of college, a dual income family without kids, I put only enough money into my 401(k) to get my company match, which was 6% at the time. As a software engineer going from my $8-an-hour job in the campus computer labs to an entry-level, salaried engineering position, it felt like we’d won the lottery. We were rich!

I quickly became very interested in saving more. Time, with its magical compounding interest, was on our side and I wanted the option to retire early. Now was the perfect opportunity to start saving more – and we did – but we were saving to buy things we thought we needed like a second car and a house.

When I got my first raise, I did something that many savings experts suggest and I’ll be very thankful for when I turn 59 and 1/2. I formed a habit that I’ve kept up to this day.

Every time I get a raise, I raise my retirement savings at least 1%. Next time I get a raise, I’ll save 50-100%.

This way, no matter what is going on with our finances, we sneakily increase savings on a regular basis. The additional money is pulled directly out of my paycheck so I don’t notice the increase and I still enjoy the feeling of getting a raise in take-home pay. My first raise was around 3.5%. So, I increased my 401(k) savings to 7% and still made an extra 2.5% take-home. It’s easier to save when you never had the money to spend in the first place.

I’ve been doing this for almost 10 years. Sometimes I don’t get raises (like when we have historic economic collapses), but I’m up to 12% going directly into the 401(k) and we’ve also got Roth IRAs.

We’ve moved funds around and had them split almost evenly between Roth and traditional accounts (not knowing whether we’ll be in a higher or lower tax bracket in 25-30 years). This month, I decided to move more money to a pre-tax account so we could have a bit more in our paychecks to save outside of a retirement account (it made a huge difference – I’m getting $60 extra each paycheck). I’m not worried about recalibrating back to the 50/50 Roth/traditional split because every time I get a raise, I’ll increase our Roth contributions by at least 1% until we’re balanced. It’s a simple trick that takes one minute to accomplish each year and we’ll reap the benefits later.

Two Months of Minimalism

 Nightstand Minimalism

I’m really enjoying my minimalism project and find that the more excess stuff I clear away from my life, the more focused and better all parts of it are. For example, I decluttered my bedroom last weekend, which included cleaning up a six-inch-tall stack of papers, notes, magazines and books from my nightstand. Now, my nightstand has only a lamp and the current book I’m reading (which is Overwhelmed: Work, Love, and Play When No One Has The Time by Brigid Schulte). Whereas when the pile was there, I would never read before getting some sleep, now I’m inspired to read every night.

While I know I’m making amazing strides toward the lifestyle that I want, the strides toward my $25K goal are not as big. In the past month I’ve saved only $81.56 for a total of $271.94. What I realized is that while clearing away the clutter is a wonderful place to start (it gives you energy and a great sense of accomplishment), I’ve been ignoring the benefits of compound interest. That is, the earlier I can strip away the excess money we’re spending, the faster it will add up to my $25K goal. Therefore, December’s challenge will be all about money. More specifically, I’m going to look at all of our recurring bills and see if there are ways to save money. I haven’t examined my Netflix options or gotten a quote from another insurance company in years. It’s time I knew I’m not spending more than I should for what our family needs.

Grocery Budget Part III: Choose Guidelines & Form New Habits

In Part I of my Grocery Budget Series, I laid out how I gathered data for a grocery budget analysis. In Part II, I talked about a simple system to analyze and come up with possible solutions for problem areas. In this, the third and final part, I’ll talk about how to implement your good ideas and turn them into habits.

 Creating Guidelines

Go back to the various brainstorming lists you developed and pick 1-2 things you can change right now to improve your spending habits from each problem category (if you can’t find any, keep brainstorming and involve your friends and family).

Write them down. These are your new guidelines. The guidelines I developed for myself were:

  1. Reduce dairy to one small glass of milk a day and cheese used in some recipes.
  2. Limit meat purchases to $20/week.
  3. Salvage our old cloth diapers and use them for nights for my older daughter.
  4. Buy some flour sack towels and quit using paper towels.
  5. Stop buying desserts. We don’t need them.
  6. Develop a collection of meals with few ingredients and with prep time less than 30 minutes.

The ideal number of guidelines is probably around three.  Three is the magic number for most lists and is small enough that you’ll be able to accomplish everything.  So, prioritize and start with three.  Keep the others in your back pocket and do those once you’ve made the first three habits.  I’m starting with these:

  1. Reduce dairy to one small glass of milk a day and cheese used in some recipes.
  2. Limit meat purchases to $20/week.
  3. Stop buying desserts. We don’t need them.

 Form New Habits

Now that you’ve got your guidelines, you need to incorporate them into your spending routines. At Opower, we use behavioral science to get people to save energy.  Here, you can use a little behavioral science to remind yourself to do these things at the appropriate time.

Your tricks will be very personalized, but here are some examples to get you started.  This is largely a creative exercise for you to figure out how to remind yourself of your guidelines at the right time.

Reduce Dairy

My main problem is that I drink a LOT of milk.  To remind myself only to drink it with dinner, I’ll write a note on the cap so I’ll see it before I get anything to drink.

Form New Habits

Spend Less Than $20 on Meat

Every week, I write a grocery list using the same pad of paper. I decided to write a reminder at the top of every sheet in that pad to remind me to stick within my budget.

Stop Buying Desserts

I did the same thing for desserts, but went a step further.  I put a reminder on my calendar during my regular grocery shopping hour that reminds me not to buy sugar.  The reminder pops up on my phone just at the right time.

How Long Does It Take to Form New Habits?

Habit formation happens at different rates for different people.  On average, it takes people around two months to form a new habit, sometimes far longer.  You’ll know you can take away the habit-forming trick when the habit become second-nature.  For instance, when you no longer reach for the milk at lunch at all.  That’s when you know you’ve made something more automatic.  At that point, you can focus your energy on forming (or breaking) another habit.

Grocery Budget Part II: Analyze What You’re Buying

Grocery Budget - Photo Credit:

In Part I, I wrote about how I researched and categorized my grocery spending over two months. I discovered that, on average, I’m overshooting my $125 weekly budget by nearly $40. Now it’s time to look at the trends and figure out why we’re spending so much on groceries.

This is a pretty long post, so here’s the short version:

  1. Gather the Data (Part I)
  2. Consider your Goals & Determine What Doesn’t Align
  3. Brainstorm Solutions
    This section contains a list of questions to ask while brainstorming.
  4. Analyze More
  5. Repeat
  6. Develop Guidelines (Part III)

This process could be used to analyze just about any part of your spending (your entire budget down to a specific category like your grocery budget). I’m finding it very enlightening.

 Consider Your Goals & Determine What Doesn’t Align

Grocery Budget Spending

Amount Spent Per Category on Groceries

I’m going to specifically look at categories where the data doesn’t align with my expectations. I set four goals for my Minimalist Food Month and two of them apply:

  1. Figure out the best ways to grocery shop and stay under budget.
  2. Explore how to eat healthier foods.

Considering these goals, a couple areas stand out. The highest spending categories in my grocery budget are, in order: vegetables, meat, dairy, and disposables (diapers, paper towels, zip lock bags, etc). Vegetables is a great category to be high on (it’s mostly due to our CSA), so I won’t worry about that.

Meat and dairy are the next highest categories. This is something I’ve been meaning to change. Meat and dairy have been linked to a variety of health issues including cancer, heart disease, and acne. In fact, there was another article published in the Washington Post this week about dairy. I feel that we don’t need to cut these items out of our diet, but we could benefit from reducing our intake.

In addition, the disposables category is killing me. With our first daughter, I used cloth diapers until she was potty trained. With our second, we switched back to disposable diapers when some of the cloth diapers began to leak. I’d love to get rid of diapers completely. Paper towels too.

 Brainstorm Solutions

Now that I know where my problem areas are, the next step is to brainstorm ideas to fix them. This might be a good place to bring in friends and family, particularly your spouse. The more ideas you have, the more solutions you’ll have to pick from. A good rule of thumb is don’t judge your ideas yet, just lay everything out on the table. You’ll pick the best solutions later.

There are a few questions I asked myself about each category that helped generate ideas:

  1. Do I really need this? Is it healthy?
  2. Are there cheaper brand alternatives?
  3. Can I use another product entirely?
  4. Should I buy this when it’s on sale or with coupons?
  5. Am I shopping at the right store?
  6. Think creatively!

Let’s take for instance meat consumption, which was my biggest problem category.

Do I really need this? Is it healthy?

The answer is no, we don’t really need to eat meat. The problem is that we like meat and aren’t ready to cut it out of our diet. Therefore, a reasonable goal for us might be to eat 2-3 meatless meals every week, which should reduce our consumption and our spending.

Are there cheaper brand alternatives?

We already buy the store brand most often and going cheaper with respect to meat is maybe not the best idea. The answer here is no.

Can I use another product entirely?

Yes, we can either use vegetarian alternatives (think Boca Burgers) or make vegetarian dishes more often. I’ve got a delicious vegetarian cookbook (Moosewood Restaurant Cooks at Home) already, so perhaps I should bolster my collection of meat-free recipes so it’s easy to choose meatless meals each week.

Can I shop when this is on sale or with coupons?

Yes, I could buy in bulk when items are on sale and freeze for later.

Am I shopping at the right store?

I’ve been informally researching this one for years. I’ve tried every store in the area, sometimes going to two or three of them each week. What I’ve found is that Target has the cheapest options, but they don’t have enough variety, especially for fresh foods. Whole Foods and Trader Joe’s have the best stuff, but you can’t get everything you need there. I’ll be writing about where I ended up shopping shortly, but for now, my best recommendation is to shop in one place each week. Find a place with a combination of decent prices and variety and just go there. I find I save time and give myself maximum flexibility in choosing exactly the right combination of foods to meet my budget.

Meat prices are relatively the same everywhere I’ve shopped. No big gain from switching stores.

Think creatively!

If I limited the amount I spend specifically on meat to, say, $20 a week that would force me to eat more vegetarian meals or buy meat when it’s well-priced.

 Analyze More

Maybe you find out that you need more data. For instance I went back and looked at the price fluctuation of various meat options that I buy weekly and the swing in prices can sometimes be a difference of $2-$5 for the same thing. I could save a lot of money if I buy a lot of meat on sale and freeze it for later.


Brainstorm and analyze each problem area. Once you’re done, the next step is picking your top solution(s), setting new guidelines and changing habits. I’ll go over that in Part III.

 My Solutions

Here are the various options we came up with for our problem areas. (Note: some of these obviously won’t work, but when you’re brainstorming, that’s OK.):


  1. At least two meals a week should be meatless
  2. Buy in bulk (when on sale) and freeze a bunch
  3. Try Costco
  4. Limit meat budget to $20/week


  1. Cut out dairy for a month and see if that improves my health
  2. Reduce dairy to one small glass of milk a day and cheese used in some recipes.


  1. Potty train my 16 month old
  2. Salvage the old cloth diapers and use them for nights for my older daughter
  3. Break out the cloth wipes
  4. Buy some flour sack towels and quit using paper towels
  5. Buy some reusable zip lock bags


  1. Stop buying desserts. We don’t need them.


  1. Completely cut out pre-made, processed meals
  2. Develop a collection of meals with few ingredients and with prep time less than 30 minutes
  3. Buy coffee only on sale


Next Step: I’ll cover how I chose my best options to fix the grocery budget and turned them into habits in Part III.

Grocery Budget Part I: Research What You’re Buying

Any good habit change should start with a little self-research. Before I can fix our diet and find innovative ways to stay within our grocery budget, I need to know exactly what we’re currently spending our money on.


To do this, I took two months of our grocery receipts and categorized how much I spent on different types of products. The categories I looked at were: Meat, Fruit, Vegetables, Grains/Cereal, Dairy, Snack, Desserts, Cleaning/Hygiene, Disposable, Spices, Other (which is a catch-all for sodas, coffee, and packaged dinners). I really wanted to get a granular view of what a typical week’s worth of shopping looks like. With a little spreadsheet magic, this is what I discovered.


On average, over the past two months, my weekly grocery list looks like this:

Grocery Budget Research

Average Percentage Spent on Groceries Per Category Each Week

Food Budget Spending

Amount Spent Per Category

On average, I spent $162.23 every week. The actual range was between $123.38 and $235.35.

Our grocery budget (for a family of four) is $125 a week. I thought I was pretty good at hitting that until I pulled up all of the receipts (including mid-week spur-of-the-moment trips to the store) and added the money we spend on our CSA. Now I know I’m nowhere near that budget. It’s time to dig deep and figure out why. This is what I’ll be doing in Part II.

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