We’re big fans of utilities here at Loving Littles. Mr. Loving works for the local power company. Our bread and butter (figuratively, since we’re some of those annoying gluten-free folk) comes from good people paying their electricity bills.

That being said, I don’t mind one bit if you can work smarter to lower your monthly utility costs. In fact, I encourage the practice!

The first step to saving money on your utilities is creating an accurate budget to gauge how much is being spent in this area. Here’s how we budget for our utility costs.

Electicity & Natural Gas

In our neck of the woods this number varies greatly throughout the year. I bet your heating and cooling bill varies too. Our home is heated by wood and a natural gas furnace.

We add up the total cost we expect for these numbers each year; one for electricity, and one for natural gas. Then, this number is divided by 12 to come up with a monthly budget amount.

You could also sign up for “budget billing” at your utility. Most companies provide this service, all you need do is ask. They charge you each month based off of your average billing history. This plan normalizes the highs and lows that come with providing electricity and natural gas. Be warned though, you’ll be on the hook each year for any additional costs incurred above your billed amount.

Garbage

If you live in an urban or suburban setting you’ll likely have fees associated with garbage disposal. If you live in the country and deal with your own trash; power to ‘ya!

We used to save money by burning trash when possible & driving to the dump monthly. Now that our family has grown by 5 we pay for curbside pickup from a local waste management company. Our trash bill comes every three months.

To allot for this category in our budget we divide our bill by three and record that monthly amount.

Phone + Cell Phones + Internet Service

These bills are all charged out by the provider monthly, so there’s no need to divide costs for the budget. We’re old school and still keep a landline. We’ve done the math, and it’s worth it for us.

Our phone is bundled with our internet and cell phones, so we’d lose the package benefit if we dropped that service. When we’re inevitably forced to swap providers (our company no longer has a contract with Apple) we’ll drop the land line too. Until then we’re content to remain in the stone age.

Television

This is a simple cheap monthly cost at our house. I said simple. And cheap. Can you guess who provides our TV service? You’re right, it’s Netflix.

Netflix rocks our world, and I bet you’ve found the value in it too. If you haven’t heard of Netflix and are still subscribing to cable or satellite, you’re missing out. Here’s a helpful rundown of Netflix vs. Hulu at Geek.com.

Combine Netflix with over-the-air broadcast sucked in by antenna and you’ll have a smorgasbord of entertainment options for super cheap. Our Netflix subscription only costs us $7.99/month. You can barely rent a movie for that price these days.

How do I account for these costs on my budget?

Each of these costs gets their own line in the budget. One for natural gas, one line for electric, one for garbage, and so on. These expenses are all grouped under the heading “Utilities”. This is what that looks like on my phone:

We use a budgeting software called Moneywell. The subcategories that you see are shown as little buckets that are filled from the “well” of income each month and then poured out into the budget. Pretty cool, huh?

Unless you’re a hermit living on a mountaintop, utility bills are a part of your life. They don’t have to be a drag. The first step is recognizing what is being spent on this category. The second step (so much fun!) is to thin out those costs through money-saving measures.

What bills make up your utilities budget?