We’re nearly two months into 2013. That’s nearly two months of living with the 2% increase in payroll taxes. Call it a tax increase or call it the expiration of a tax cut, but either way, we’re coming home from work with less money in our pockets.
And it really can’t come at a worse time. i don’t know about the rest of you, but here in Southern Oregon, the economy still stinks. Unemployment is high and so are the prices of necessities like food and gas. This year we saw an increase in our electric rates, in food prices, and I just heard that gas prices have been rising for 30 days straight. All families, but especially one income families, are feeling the crunch, my family included.
What the Payroll Tax Increase Means For Our Family
What does 2% less take home pay mean for us? A 2% cut in take home pay normally wouldn’t be that bad, except, as I said above, prices are rising, so 2% feels like much more. Since we already live very frugally, any less take home pay means we need to evaluate every line item in our budget. Cuts are difficult to make, when you have already chopped the grocery budget, entertainment expenses, and outside activities. Now we’re beginning to look at budget cuts that hurt a little bit more.
I’d say the one big expense that’s on the possible chopping block is Bug’s private school tuition. Yes, we may bring Bug home for homeschooling again next year. Fortunately, he’s on board with the plan, if we go through with it. We can’t cut car payments, because we don’t have any. Our mortgage isn’t going down anytime soon. And we already pay close attention to saving electricity. School tuition is the next easiest thing to cut. Not that it’s easy at all.
Little Things We do to Save Money on a Weekly Basis
Combine trips into town, so we drive less. Some driving we can’t avoid. Sportsguy has to go to work, and Bug and Stargirl have to get to their classes. We don’t live near public transportation, so we have to drive. However, I’ve been doing all other shopping and errands on Mondays, when I’m already in town. It makes for a long Monday, and sometimes Boo gets frustrated with the time we spend in stores and in the car, but I’ve found snacks and a few toys work to redirect her.
Limit shopping. An easy way to spend less money is to stay out of the store (and out of the online stores!). Beyond that, though, I consolidate my shopping, so I’m not wasting gas going from store to store (see above). I do the vast majority of my shopping at three stores. Rather than running from store to store to get the good deals, I use printed ads and coupons I get off the internet and take them to Walmart for their price match guarantee. I still get the deals, but I don’t waste the gas. And by limiting my shopping, I’m not tempted to buy things I don’t need. I use a list and get in and out of the store as quickly as possible.
Do it ourselves. We try really hard to do things for ourselves, rather than paying other people do do things for us. In the last year, I’ve learned how to install a ceiling fan, replace an electrical outlet, and make new window screens. I’ll be taking up gardening again, too. These days I can grow my own food for less than I can buy it in the store, and it’s probably healthier, too. And I love that I can get good seeds like Seeds of Change from Walmart, rather than ordering them online through expensive seed companies. If you’re looking to start a garden, I highly recommend Square Foot Gardening by Mel Bartholomew. You can’t go wrong with his approach.
Research. When money is tight, research is important. Gone are the days of impulsive spending. When I make purchases these days, I thoroughly research them. I ask friends about products they’ve used. I read reviews online. I evaluate whether we really need a new product, whether I can buy it used, or whether I can borrow it. The best way to save money is to not spend it in the first place. And when you do spend, make sure you’re buying something worthwhile.
Network. I’ve seen a lot of people networking to buy and sell gently used items lately. One woman from my church started a “Marketplace” group on Facebook for our church. Members post items they’re selling and items they want to buy in the group. It’s a great way to find items you need at a big discount, sell items you don’t want for needed cash, and help the community.
A local homeschooling blogger puts together a list of curriculum for sale/curriculum wanted every month, so people in the community can help fill each other’s curriculum needs. The charter school Stargirl attends puts together a clothing/book swap every spring. As the depressed economy drags on, it’s becoming more common to see communities band together to help each other out. Networking is one of the best ways to save money.
The Bottom Line
We’ve been living in tough times for a while. Despite what the “experts” say, I don’t see much evidence of improving times. But I’m also not one to take a “glass is half empty” approach to life. In the coming months and years I look forward to seeing how communities come together to help each other out. I also look forward to seeing how churches get involved in meeting the needs of their communities. And if it comes to it, I look forward to once again teaching my son at home and spending all day with all my kids. We miss Bug when he’s gone!
How are you coping with the payroll tax increase? Has it affected your life in a major way?