Reduce monthly bills — a universal topic that has as many opinions as there are people. How many times have you listened to financial gurus like Dave Ramsey talk about how to reduce monthly bills and thought, ” Dave, it’s been a long time since you had to figure out how to pay less for your utility or water bill.”
But for most of us? The process of evaluating ways to lower bills is real life – every month.
We’ve been consistently spending less and saving more, using this same 3-step system for decades — in our actual home, with real bills, just like yours. And it works.
We’re not professional financial planners. We’re not some Facebook thread arguing over who’s more frugal. We’re a real couple who decided long ago that we were going to do whatever it took to live beneath our means on a low income – and cut our bills drastically to make that happen.
So if you’re ready to take back some control of your money — without stress or shame — here’s how we do it.
Step 1: Know Exactly What You’re Spending
You can’t fix what you’re guessing at. The first step to reduce monthly bills is to stop playing the “I think we spend about…” game.
We’ve done it — and we always guessed too low. When you estimate you pretty much guess wrong – nearly every time.
If you’re serious about lowering a bill, you need hard numbers. Not just what you spent last month, but what you’ve been spending over time — we recommend at least a quarter (three months) of data.
Break the bill down. Look at fees, taxes, supply charges — all of it. What’s fixed, what’s usage-based, and what you can actually control.
Here’s a real-life example. We recently completed a five-month challenge to lower our utility bills. The power company raised their summer supply rates by 50%. They told customers to expect to pay an average of 20% more this summer. But, we weren’t about to just accept it. We pulled past bills, tracked our usage, and made a plan.
When you know your numbers, you stop feeling “powerless”.(Yes, it’s an energy pun. I couldn’t resist.)
We set specific goals, which included paying less for our bills, not more.
Here’s the end result.
Over a 5-month period we were able to lower our average electric usage by 22% and our summer bills by 6%. That felt a whole lot better than a higher bill.
To find out how we met our goal, keep reading.
Step 2: Understand How Your Habits Affect Your Bills
Once you know what you’re spending, the next step is understanding why.
Habits matter — a lot. Leaving lights on, using energy-hog appliances, running water longer than needed… it all adds up. We realized our wall oven was tripling our electricity usage during the time we had it turned on.
So we pivoted. We started using other appliances that did the job with way less energy.
This step is about zooming out and asking, “What small changes we can make that’ll add up big over time?” Think of anything that will help you reduce monthly bills – no matter how big or how small.
Document these changes. Make a list of them. Then, determine that you will follow through with these new habits for at least 30 days.
Step 3: Make the Change — and Stick With It
To budge a bill you need to plan changes and actually stick with them. Document your actions. Gather all the information you can. Remember, statistics and data are your new best friends. They help you determine what works and what doesn’t, which strategies move the needle, and what habits you want to double down on.
This isn’t about perfection. It’s about giving yourself a solid 30 days to really try. Make changes, follow through the best you can, and then take a hard look at the results.
At the end of 30 days, compare your actions with the results. It’s the only way to determine if you were successful in your quest to lower monthly bills.
- Did the bill drop? If so, by how much?
- Were you able to reduce your usage of the product? For instance, were less kWh of electricity used?
- Can you relate the final bill to any habits that you deliberately implemented that month?
- Will I repeat this challenge now or set it aside to try again later?
Be sure to gauge your success on multiple levels. Just because you didn’t reach a goal, doesn’t mean you didn’t learn about strategies which will help in the future or habits which you still need to change.
We’ve used this exact same process this for 30 years, and it doesn’t always go smoothly. Sometimes we knock it out of the park. Other times? The results are less than expected. That’s real life. But every time, we learn something new, get a little better, and tighten things up for the next round.
Your turn!
What’s one bill you’re planning to tackle first? Or have you already found a clever way to cut costs in your own home?
We’d love to hear what’s worked (or what hasn’t). Drop a comment below.
