Tash, there are different ways to measure lean body mass versus fat mass. A common way is the caliper method -- where they take measurements of size of the fat fold under your skin in various places. According to what I've read online, that method is to within 1-5% accuracy and it depends a lot on the skill of the person doing the measuring. This is what my trainer is doing monthly. She also uses a tape measure to measure various things like waist size, hip size, thigh size, etc... Those numbers are going down too

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Another way to do body fat % is to get into a tank of water, exhale all your air, hold your breath, dunk completely in the water, and they measure the body fat % somehow. I think they do it on the amount of water displaced, but I'm not 100% sure. I believe this is the most accurate way to measure body fat, but it requires a big tank of water and some high precision measuring capability. When I was at college, there was a research study I signed up for where they measured our BF with this method, then had us do exercise, and measured the change 8 weeks later. I don't remember much more about it, except for the procedure.
Good job on making healthy eating choices all! One thing I've found that helps is concentrating not only on taste, but also on fullness. For instance, Yoplait Light yogurt is only 100 calories, and is a nice snack if I'm hungry before bedtime. Every other time I've lost weight before (actually dieting or not), I've essentially starved myself. I hate going to bed hungry, and from what I've read and been told, letting yourself get too hungry is actually counter-productive -- you tend to over eat then. I am certainly no expert and am curious whether or not I will be able to lose weight down to some "normal" level and keep from being ravenous, but I certainly hope so.