If you’ve been following along with this series and have been participating in the
expense evaluations of the last week, you’re probably feeling pretty good about
your financial direction. Now we come to the part that is the hardest for people to
give up – and the one that makes most people relapse: entertainment and
hobbies. In other words, all of the consumer joys you have in life, from television
to gadgets to video games to clothes shopping.

I’m going to say something shocking here: if you really want to commit to this
plan long term, you should not give up most of these things. They bring a
lot of day to day joy into one’s life and the guilt that they bring is due to excess,
not due to the spending itself. The key is not to trim out all the lattes you
drink, but instead trim back a few lattes a month. That way, you can still
get the simple pleasure of enjoying a latte, but you also get the pleasure of
skipping one every once in a while with the realization that you’re skipping it for
good reasons. It turns something that can be a big negative (and thus makes it
very easy to quit and give up on) into something that is a net positive.

With that being said, take some time today and go through your more frivolous
expenses in a given month. You can start by digging out your last month
worth of credit card and checking statements and highlighting
everything you bought for pure entertainment, simple pleasure, or for
a hobby. This might take a little while, but it’s worth the effort.

Once you’ve highlighted all of them, go back and make some approximate
groupings. For example, group all of your coffee shop visits together, or all of
your book purchases together, or all of your music purchases together. Use
groupings that make sense to you; if you try too hard to use what someone else
thinks should be grouped together, it will have no meaning for you.

Now, go through these groupings one at a time and ask yourself whether it would
detriment your life to trim back spending in this area. Let’s say you buy a grande
latte each morning at the coffee shop. Maybe you could cut this back to four times
a week, with two of them being regular lattes? That way, you could still enjoy your
big latte on Monday morning and Friday morning and still have some on Tuesday
and Wednesday, and just drive into work with a smile on Thursdays knowing
you’re working for a great future. You might also pledge to go to the library and
mill around every other time instead of going to the bookstore or the music shop.
Remember, if cutting back at all makes you feel really unhappy, then
don’t cut back.

These little changes are the ones that quietly make a big difference; if you try to
make a big change, it will be no different than a New Year’s resolution where you
decide to diet and spend the first week eating salads. By the end of January, you’ll
be knocking back the proverbial poundcake and it will have all been for naught.
The key is to find those places where you can cut off some fat without
damaging the meat.

Tomorrow, we’ll look at credit cards, their fees, and what we can do to reduce
them.