Life has been different for five months,  Some people are just beginning to feel the economic impact. 

An entrepreneur friend of mine has seen her revenue plummet.  What little is left gets consumed by rent, electricity, insurance premiums — in other words, fixed expenses.

Managing Your Fixed Expenses

In an ideal world, a person’s or a business’ monthly expenditures on fixed expenses would be about 66% of their income. As income drops, your fixed expenses stay the same, taking up a larger and larger percentage of your spending plan.

So how can you reduce your fixed expenses?

You can always try to negotiate a better deal on your phone. Maybe you’ve been using Skype since you’re home all the time and unlimited minutes seem quaint. Even if you’re using the same amount of minutes, cell phone companies usually have better perqs available if you call in and speak to a representative. The same is true with your cable company, which is probably trying to stop an exodus of “cord cutters” from cancelling TV service altogether. 

If you rent, try talking to your landlord if you are having trouble paying. While it’s true that landlords need to make a living like everyone else, if you’re reading this blog then they don’t want to lose you as a tenant. You’ve likely been paying your rent on time every month until now. I think rather than start eviction proceedings, most landlords will give you the benefit of the doubt.

If you have a mortgage, maybe it’s time to renegotiate a new rate. Maybe you want to get a five- or 10-year ARM instead of a 30-year fixed. Talking to your lender is always better than defaulting, because there may be assistance or forbearance available. 

No matter what your situation is, it’s always time to start using some kind of program like Quicken, Mint, or any one of the programs that track your expenses. Even if you’re using Excel, it’s a good time to take a list of every penny you’ve spent and go through it line by line and see what you can eliminate.

My last bit of advice is to embrace social distancing from a money-saving perspective. Do we really need any new clothes or shoes or makeup? I was away last week and my shopping haul was much lighter than my previous trips to Provincetown. I ended up buying a couple of cute masks because that’s what I need. Don’t get me wrong, I blew kisses to all the clothes — but I don’t need to be a fashion blade to watch TV this winter.