What do you consider to be a household necessity? A 4 bedroom house, 2 cars, cable television, microwave, cell phone, high speed internet, DVR, Netflix, computer, Ipod?
Now, depending on how old you are, think back to the 1970s or 1980s and ask yourself whether the above items were a necessity or even available. That is the idea behind a flashback budget.
In the 1970s people generally lived in smaller homes, drove smaller cars (and generally only had one per household) and ate more meals at home. There was also likely no cable bill, no cell phone bill, no internet bill, etc.
If you have been working a budget or spending plan for more than a few years, take a few minutes to review your budget categories and numbers from the past. You may be surprised that even 5 years ago you lived a very good life without a few of today's "necessities."