I make a rather bold statement on my page, namely that we (husband, wife, 4 cats and currently 44 chickens) are living on $17,500 a year.
That number represents our budget for household expenditures, including food, housing, car maintenance, gasoline, healthcare costs, gardening expenses, utilities, etc. The things in short one needs and to some extend wants to live (yes, the hubbin could ride his bike to work and save that way, but I prefer my husband non-homicidal and the car pool is working and I could save on the electric bill by using using less electric cooking gadgets and going with muscle-power instead, but I'm lazy and will do that if and when I have to)
We are keeping to this budget in order to pay off some rather substantial debts we have accumulated over a few years of intermittent employment for both of us. We are both VERY adamant about sticking to this budget, even after we are debt free, because we have managed to bring our bills down to this level without sacrificing anything we miss (yeah, we are sort of shocked, too) and have found some rewarding and enjoyable hobbies in the process. We have in fact become frugal. (Scrooge McDuck would be proud)
In the interest of full disclosure, however, I feel that I should add here that we DO go on one yearly vacation that is not part of the stated budget. The funds for that vacation are derived from income that is not steady, is not considered for the debt or household budget and is kept in a separate account for just that purpose. It's a luxury we allow ourselves, work for and toward and give up other things for on occasion (surplus generated in the grocery budget goes straight into this bucket, to give one example, and any income generated through my sales for another).
So, the budget I talk about here represents the monies we allocate for things that are not optional, because much as I would LOVE to not pay the water bill some months, I sort of have to, ditto the mortgage, if I intent to continue living here and staying at least marginally clean, which we do. Things that are optional (vacations, plastic surgery, private planes, starbucks) are not part of it, because they are in fact luxuries, a bit of knowledge the advertising industry works hard to make us forget. And in a way I am glad that they do, because I WANT to hear about new products, I NEED to know that there is something out there I may want. Advertising is an invitation, not an obligation.
I will probably at some point talk about how we finance our vacations and the plastic surgery for the cats, so stay tuned :D