Starting with the Expenses

by Chris McGinty of AccordingToWhim.com

I wrote a blog post talking about saving money when there were possible consequences for not saving money. It simply stated that we can cut back and save when faced with possible crisis, but we’re maybe not so good at it when we’re comfortable.

One thing I’ve realized is that when we need more money the go to solution almost always seems to be to work more. Get a second job. Get some overtime. Sell your body to science. Maybe not that last one. Even increasing how much you get paid doesn’t always solve the problem, though it rarely hurts.

That was my solution for a while too, but at some point I was working way more than was reasonable and I was still not making any real progress. This is when I started an admittedly long process of cutting back my expenses. Even with all the cutting, I could probably still reduce my expenses a little more if I had to. But that’s not really my point.

What I realized is that cutting expenses is probably where I should have started, not increasing the amount of work I was doing. I’m not saying don’t increase the amount of work. I’m just saying don’t start there. I figure that it’s actually easier in most people’s mind to trade more of their time to maintain their lifestyle than to cut back on their lifestyle. I’m not sure why this is, but it seems to be the norm.

I argue that cutting back lifestyle is easier to reverse than losing more time to additional work. If it turns out that you hate cooking every night, you can start eating restaurant food again. But so often I see people get a second job and not seem to be able to get rid of the need for it, because their lifestyle increases with the job rather than fixing the initial problem. I work in an industry that thrives on people needing a second job (delivering pizza) and I see it happen all the time.

I also argue that you take more steps toward financial stability if you make more decisions at the start. When you get a second job, you’ve only made one decision. When you question all your expenses you have to decide each time whether the expense or your time is more important long term. If you start with the second job, what’s the likelihood that you’ll later come back to the reducing expenses part?

You’ve heard the time management folks say that you should start with your biggest and most important task first. I think that applies here. Get the tougher part of reducing your expenses out of the way, and then reassess whether you actually need a second job.

Chris McGinty is a blogger who really has no standard of living. All he really needs in life is enough to be a blogger who really has no standard of living.