Savings Dilemma

I just finished taking a quiz on how you spend your money that was both eye-opening and frustrating. The goal of the quiz is to tell you how close you are to the ideal 50/30/20 spending pattern that many money gurus say you should follow. (That's 50% to your needs, 30% for wants, & 20% for savings.) Apparently our family spends a whopping 83% on our needs, 12% on wants, and only 5% on savings. It may even be more skewed than that because I didn't include Terence's unpredictable overtime checks, which pay for things like dental work, car repairs or other big ticket items that may smack us without warning. Of course, the accompanying articles go on to explain that if your needs percentage is too high, then perhaps you have spent more on your house or your car than you can afford. Seeing as we have no car payments right now, and there is nothing under the sun we can do about our house payment, I don't quite know what they would expect us to do about it. The other big chunk of our needs section was insurance (life, health & auto). I've never added up how much we spend on insurance before so that was interesting. We spend about $450 a month on insurance, but I have no idea if that is high or low. How much do you spend? Is it similar to us?

The real killer is in our groceries section. Our family spends almost as much on groceries as we do on our house. Now, I'm including everything in here-- diapers, cleaning supplies, dog food-- not just the food we eat. It comes out to about $133 a month for each person in the family. Once again, I don't know if this is terribly high or low, but I do remember seeing a post from another mom with a family of four kids, and they only spent about half as much as us. So maybe our family is eating like royalty instead of spending money on other stuff.

But armed with this sobering information about just how close our family lives to the edge, I just can't understand how people I see all around us in our not-very-affluent area can afford things like ATV's, boats, iPhones, huge flat screen TV's, and nice furniture. Do they do it all on credit? If they do, who is loaning to these people? So many luxuries in my family (high-speed internet, preschool, housecleaning, my triathlons) are paid for through the generosity of others; is that how they do it? Wealthier friends and family showering gifts on them?

Gosh, that last paragraph sounds like I'm coveting my neighbors' stuff, doesn't it? It's not really that. I'm very grateful for what our family has. We have all that we need to take care of the necessities plus a little extra, so who am I to complain? It's just that I would like that savings number in our equation to be higher. I read these tips that tell you to cancel your cable, sell your recreational vehicles, and stop buying your clothes at the mall, and put that money into savings, and I can only dream that there was enough extra that I could trim that stuff out and sock away the money.

Ah well. I suspect that if I was to put the money in savings second, right after paying tithing, we'd find a way to live on the rest. But since I cannot find a way to work it out on paper, I have not yet taken the plunge. Maybe because I remember all too well how hard it was to live on food storage and I can't quite force myself to go back to eating like that. Do any of you manage to save 20% of your income? If so, how do you do it?

Update: Per Kim's request, you can find the quiz right here if you'd like to see how your own budget matches up.