The first step is to make a list that shows where all your money is going. Once you know this, you need to figure out ways to reduce the amount you are paying for each item on your list, instead of deciding what items to eliminate. While this may seem difficult at first, it's not too hard, and the more you practice it, the easier it will become. Here are a few examples of ways to accomplish this:
Instead of canceling your cable TV or moving to a slower Internet service,
you can confront providers with competing offers
and get the same service for a less-expensive price.
You can do price comparisons to see whether you can get the same coverage on your car insurance and homeowners insurance for a better price.
You can take a look at your electricity, water and gas bill and see whether there are ways to reduce the amount you spend without changing your lifestyle, such as washing clothes in cold water (you won't notice the difference) or installing energy- and water-saving devices.
These steps aren't limited to services. If you purchase a couple of soft drinks each day at work, you could instead purchase them in bulk from a discount warehouse club. You get the same drink, but at half the cost.
What all the above examples have in common is that you are still getting the same items or services that you are getting today, but at a better price. This frees up money, allowing you to save while still living the lifestyle you have enjoyed. By looking at all your expenses and reducing the amount you pay where it's possible, you should be able to shave several hundred dollars off your monthly spending.
While this system will not work for those that are completely out of control with their spending, it will work for the vast majority of people. The key is that you focus on reducing costs without eliminating or reducing what you are currently getting.