by Rana Williamson

Created on: March 18, 2009

You run the numbers. You take an aspirin. Maybe you take a drink. And then you accept the facts. It's time to cut down on your living expenses. Here are six steps you can take to get started.

1. Find out where your money is going.

Until you've spent at least a month tracking every single expense, you'll have no idea how to make an intelligent plan to cut expenses. Put expenses in logical categories (utilities, groceries, medical) that will later form the basis for your home budget. Also take note of "fixed" expenses and make a special list of those items.

2. Evaluate your "fixed" expenses.

How "fixed" are they? Can you re-negotiate your mortgage or rent? When was the last time you reviewed your auto and homeowners insurance? Are you paying to insure items you no longer own or not getting the discounts granted for things like new heating and cooling units or home security systems?

Look over every single service contract to which you subscribe. Are you using all your cell phone minutes? If not, can you lower the plan or go to a "pay as you go" phone? Do you even need your landline anymore? What about your cable bill? Do you watch the premium movie channels? If not, why are you paying for them?

The truth is that most people don't get reductions in their service contracts because they don't ask. Everything is negotiable. The worst thing that can happen is that they say no.

3. How about entertainment?

Stop buying books and renting movies. Use your local library. The librarians will order items you want through interlibrary loan. Granted the DVD offerings are not the latest releases, but they are free. For newer movies, look at a Netflix account. Their mail service is so efficient you can see all the movies you want per month at a much lower cost than the corner movie place charges.

What about TV? You've already looked at renegotiating your cable contract, but can you go a step farther? All the major networks have their shows available for streaming on their websites and sites like Hulu and Joost have even more content. Can you get rid of broadcast altogether and watch your shows online?

4. Get a handle on the food situation.

There's no bigger budget buster in America than take-out food - followed closely by mindless grocery shopping. Cook at home and evaluate your food buying habits. Buy fresh produce, not canned, and stay away from name brands in favor of store brands.

How high is your store? Do you even know? Make a list of the things you buy most often, complete with prices,

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