Reduce your monthly bills with this easy savings tip

It's January which means it's that time of year to start thinking about ways to save money. I'm so obsessive about expenses that I have already had my wife download the our yearly expenses into Quicken and had her categorize them into monthly bills. If you don't have Quicken or any other commonly used software program my advice (i.e.: if you are obsessive like me..) is to download our free monthly bill spreadsheet calculator. You can find it by clicking here.

As usual all of my yearly expense average about what they did last year. I do have a few that are out of whack. One that really sticks out is "dining." We separate "dining" from "entertainment" based on are we just going to lunch or dinner or are we going to dinner and a movie as a family. Dinner and a movie is "entertainment," just going to lunch or dinner is "dining." Pretty simple, I might be obsessive in knowing how much money is spent but as long as the categories remain the same year after year I don't really think you need a "lunch," "dinner," "entertain friends and relatives," and "entertainment" category.

The first rule is to try and keep it simple so you will do the exercise of categorizing your monthly bills which will lead you to your yearly expenses.

As I mentioned I do have one category that is out of whack and that is dining. I know exactly where the problem lies, I go to lunch everyday with coworkers just to get out of the office. And, on top of that I don't expect this to change, just to keep my sanity I have to get out. So there is no way I can reduce my monthly dining bill by not going out to lunch, that's not going to happen (no pun intended).

Still this category was up 17% over last year. It was a $1,500 swing from 2010 to 2011! That's a lot of money. For the average family that's one monthly mortgage payment,  2 monthly day care payments, 3 monthly car insurance payments, or 4 car payments.

The point is I need to get this category under control. There has to be a way to at least slow the growth. Since it's January I'm going to make it a goal, I'm going to reduce this category by at least $350/year.

What is the one saving tip that can reduce your monthly bills and save you over $350 year?

I didn't pick this number randomly, actually I was at lunch with some friends and I bought a salad and a diet coke. Nothing unusual here I buy salad and a drink everywhere I go.

It just so happens that I was waiting for a table and had nothing to do but fill my drink at the soda fountain and then I decided to look at my receipt. My salad with grilled chicken on it was about $9.50 and my drink was $2.50 bringing the total with tax to about $12. I was thinking... man I remember when lunch cost me no more than $10. My friends and I like this restaurant so I'm going to occasionally eat here. What's on the menu for under $10?

I'm thinking about this looking at what other people are eating and then the 4 of us find a seat. I started looking at every ones lunch choice and they all looks so normal, salad, salad, sandwich, sandwich. Nothing out of the ordinary then I notice, diet coke, water, water, water. Hmmm I just spent $2.50 on a diet coke! So the math starts flying... $12-$9.50= $2.50, $2.50/$12= 20.8%!

I could save 20% at this location by just drinking water with lemon.

A few days latter I'm at lunch at Chick-Fillet by myself, I step of to the counter and ordered (you guessed it) and salad with grilled chicken and a WATER. I sat down, looked at the menu board and saw that a drinking  a soda is about $1.50 after tax. So even at the low priced restaurant I'm saving about 20% ($7-$1.50=$5.50 for just my salad, $1.50/$7.00=21.4%).

Lets do the down and dirty math on this one simple easy step to reduce your monthly bills. This one coke saves $1.50/day or in 4 days it will save $6. That means that each week just by getting water instead of a diet coke saving $6 means my Friday salad is basically free.

Let's take it out a bit further. There are typically 21 working days in a month so 21 * $1.50 = $31.50/month. This $31.50 month is about 1/2 my water bill each month, so my by getting water at lunch I'm paying for 1/2 of my water bill each year.

A little further... $31.50/month * 12 months = $378/year or just about 1 car payment.

Even a little further.... $378/year * 20 year working career = $7,560 reduction in my bills just by drinking water instead of diet coke. UNBELIEVABLE!

I said in the title of this featured article I would give you at least one "simple easy tip" to reducing your monthly bills. How much simpler could it be - the next time you go out to lunch skip the soda and just order water. If you did that every day of your working career you would save $1.50/day, $31.50/month, $378/year, and $7,560 in your career. Could it be any simpler?

You can do it.