You'll only make so much money in your lifetime; this is why it's imperative to save as much as you can. Saving money can help you build wealth, lessen your reliance on credit for unexpected expenses, and provide peace of mind on your financial health.
Saving money is a discipline in that you alter small behaviors. By taking these tips into account, it will help you focus on making small changes now that will pay off big in the future.
39 Money Saving Tips
1. Develop a Budget
Your first step is to develop a budget which becomes your financial blueprint. Without one, you are directionless. Along with setting limits on how much you spend, you should set goals for paying down debt and saving money. These goals should keep you focused on the tasks at hand, especially when analyzing your spending behaviors.
2. Every Expense Matters
You should understand the impact of small expenses. To demonstrate, say you buy a $2 cup of coffee five days a week. That's a total cost of $10 weekly, which doesn't seem like much, but when you multiply by that by how many weeks are in a year it totals out to $520. This shows the more you allow small purchases to be a part of your financial behaviors, the more costly they become long term.
3. Keep Tabs on All Expenses
You should monitor your finances monthly to view your spending habits. Many banks and credit unions offer software where they categorize your expenses for you such as bills, groceries, dining out and more. When reviewing these expenses, look for patterns of behavior you can eliminate such as that daily coffee out. While it might not seem like much now, that change can save you over $500 a year.
4. Find the Best Deals on Necessary Expenses
Though you have to pay for things like insurance and cell phones, it doesn't mean you have to overpay for them. The internet is a glorious resource where you can shop for the best cell phone plans or the most reputable insurance providers. By doing comparison shopping, it allows you to identify the best plans for you, resulting in better savings.
5. Eliminate Unnecessary Expenses
If your finances are tight, consider trimming expenses you don't need. A great example of this is cable service. Chances are, you can access the programs you like through streaming services like Hulu. Best of all, cutting cable can save you as much as $100 monthly.
6. Find Less Expensive Phone Plans
Having smartphones can be expensive when you factor in the price of the device and the monthly service plan. There are some ways to reduce the fee. Here's a look at them:
- First, you can ditch your smartphone. This might seem drastic but if you want to save money this is the best way to do so.
- If you are on an individual plan, consider finding some trusted friends or relatives and join a family plan together. Each of you will pay much less for the same service.
- You can also have service with another carrier like Cricket Wireless or Metro PCS. Both have cell phone plans with data starting at $30, making them much less expensive options than the major carriers charge.
7. Make Saving Money Priority Number One
It doesn't matter how much you save starting out, it's placing emphasis on saving money. If you can only save say $10 every two weeks, it's still an excellent start. The best way to do this is to set up automatic transfers from your checking to your savings account and treat that transfer as a payment in your budget.
8. Develop Savings Goals
Once you develop the habit of saving, set benchmarks you want to achieve. To illustrate, say you want to save $1,000 in the next year. Instead of just making that one goal, develop shorter goals along the way to maintain focus such as saving $84 a month for 12 months.
9. Have an Emergency Fund
Surprise expenses such as medical bills or a car repair can cripple your finances if you are unprepared. With this in mind, set aside an emergency fund of at least $1,000 to account for the unexpected. Then, when it happens, it won't hurt your finances--since you have the cash saved--and you rely less on credit to pay for the expense.
10. Opt for Online Savings Accounts
Online saving accounts offer a much higher rate of return than you will receive with your traditional bank. In addition, many online banks won't charge you a monthly fee, making it a better option to store and grow your investment.
11. Take Advantage of Work Benefits
Many companies offer 401(k) matching, where they will contribute as much as you do to a specified percentage. This is money provided by your company you use to invest. Therefore, be sure to maximize your contributions to your 401(k), as they are pre-tax--meaning you don't pay tax on them--and you receive the maximum benefit allowed by your employer.
12. Pay Bills on Time
Late fees are what Dave Ramsey calls the stupid tax because you are wasting money on them. To prevent late fees from ballooning your balances, set up automatic payments with each lender and utility company. You can also use BillPay, though in this case, make sure the payment arrives by the due date--the service provides arrival estimations when you process payments.
13. Understand What You Used Debt For
Another aspect of your finances to analyze is your debt. If you ran up high balances on your credit card, what were your spending patterns? Do you trade-in your vehicle every few years? By asking the hard questions now, you can change your behavior so you don't repeat mistakes in the future.
14. Develop a Debt Repayment Plan
Looking over credit card and loan statements can be depressing, especially if you owe a bunch. However, by developing a debt repayment plan, you can be confident you are moving towards financial freedom. Here are some tips on repayment strategies:
- You can use Dave Ramsey's debt snowball plan, where you group all your debts by total amount owed then pay off the smallest one first while making minimum payments on the rest. Once paid off, you move up to the next size one until you have paid off every one.
- If you carry high credit card balances, consider a debt consolidation loan. These are great if you have a good credit score (660 and above), as you consolidate all your debt into one loan, saving you money on high interest from credit cards and total loan costs since your repayment term will be less.
- If you are struggling to make your payments, use reputable consumer counseling agencies to set up a debt repayment plan. With this, the agency works on your behalf to negotiate with creditors on a monthly payment that fits your budget. Often, the agency can get creditors to waive late fees and lower interest rates during the repayment term.
In any regard, keep this in mind: the faster you pay off the debt, the more time and money you have towards building wealth.
15. Negotiate With Current Lenders
Similar to necessary expenses, you shouldn't have to overpay to have a credit card or car loan. If you have been making timely payments, contact your lender to ask for a lower interest rate. If they are unwilling to oblige, then you can search online for the best auto refinance loans.
16. Buy Paper Items in Bulk
Stores such as Sam's Club are great if you use them to your advantage. Buying household items in bulk such as paper towels, toilet paper, and more can result in you saving money because the price is less per unit. Additionally, it reduces your future trips to the store and the impulse to buy more that comes with it.
17. Plan Meals in Advance
To avoid an eye-popping grocery bill, plan your meals in advance. This simplifies shopping in that you buy only the items you need, reducing your grocery bill and food waste.
18. Make a Shopping List Before Going
Prepare a list of items you need before shopping. This reduces the amount of time in a store, keeps you focused on the items you need, and can help curtail the temptation for impulse buys.
19. Buy Generic
No matter if you are shopping for groceries, home decor items, or even prescription drugs, it's a safe bet to opt for the generic brands. What you will find is they mirror their brand name counterparts in ingredients often at a fraction of the cost.
20. Make Your Own Stuff
A great way to mitigate the high expense of items is to make them yourself. To illustrate, you can make your own laundry detergent. Considering how often you wash clothes--hopefully--this can net you some significant savings over time.
21. Use Apps To Save Money
There are a variety of helpful apps out there that can save you money on regular expenses. GasBuddy uses your location to find the cheapest gas prices around you. Meanwhile, with GoodRx, you can search based on your prescription to find the pharmacy with the lowest prices near you.
22. Cut Down on Eating Out
One of the biggest budget blunders is eating out most nights. Sure, it's easier, but it comes at a high cost. Instead, set up a day during the week--Sunday works for most people--and make several meals ahead of time. That way after a crazy day at work you can come home and have the same convenience of eating out, at much less expense.
23. Use Coupons
Many grocery chains offer reward programs, where they issue you coupons based on your shopping behaviors. Sure, it's a little creepy they want to track your habits, but at the same time, you can save money on the products you buy the most.
24. Grow a Garden
Want a hobby that is enjoyable and saves you money? You can grow a garden. By doing so, you have access to fresh produce and herbs at harvest time not to mention you'll save money in grocery costs.
25. Go Thrifting
Your local thrift stores are excellent resources for items like home decor, clothing, and more. Best of all, you don't pay that high retail markup.
26. Make Gifts
Social media platforms like Pinterest are excellent places to turn for gift ideas you can make. In most instances, you don't have to possess Martha Stewart's crafting prowess either. Making gifts can cost much less than buying something at retail, and you have the added bonus of it being personal.
27. Learn to Repair Items
Learning to sew or hem up your clothes can make them last longer, reducing your need to buy newer clothes. Moreover, whether it's home improvement projects or doing repairs to your car, many experts have how-to videos on YouTube to assist you. Doing these projects yourself can save you a large chunk of change in labor expenses.
28. Join a Gym
It costs some money up front, but using a gym membership can save you money now and in the future. Some employers offer to pay for your membership while health insurance companies provide gift cards if you are a gym member. Most important, exercising regularly can reduce chronic conditions from occurring in the future, keeping your healthcare costs reasonable.
29. Get a Roommate
There's no doubt it's liberating to live alone, but it's also expensive. If you have an apartment or home with multiple bedrooms consider having a roommate. Sure, you can encounter some Oscar and Felix situations, but you also reduce your living expenses by as much as 50 percent. For some compromises, this is savings worth doing.
30. Make Your Home Smart
Home automation is a great way to rein in high energy costs. Many home security companies offer these packages where you can control your home's lighting and temperature controls remotely. By setting the temperature a little higher when you are not home during the warmer months, you reduce the amount of energy your home exerts, saving you money in utility expenses.
31. Make Your Home More Efficient
Little touches you do now can go a long way to reducing your home's energy expenses. Placing a draft blocker under your door keeps cool air out, resulting in your furnace not having to work as hard. You should also have your home's HVAC unit inspected regularly to ensure it operates in peak condition. Lastly, replaces your furnace filters every 60 to 90 days--depending on the filter you buy.
Biking is a great way to commute around town and enjoy exercise. Furthermore, it's free compared to driving your car or using public transportation.
33. Visit Your Library
Your library is an excellent entertainment resource. You can rent out books, DVDs, audio CDs, and more for free. Additionally, many libraries offer their patrons free classes on everything from using computer programs like Microsoft Word to filing taxes.
34. Explore Alternative Ways to Pay for College
Affording a college education doesn't seem like a reality for many. However, there are things you can do to make it so:
- Search your college's employment section and apply for jobs that match your skills. Many universities offer free tuition to their staff.
- You can also go the community college route. These colleges cost much less and offer programs in a wide variety of in-demand fields like medical and IT.
35. Avoid College Altogether
There are plenty of jobs you don't need a degree for that pay well. If you want a stable income, consider a skilled trade like plumbing or carpentry, where you can receive on the job training by way of apprenticeship. When you complete your training, you have a job skill that will always be in demand and you won't have crippling student debt to account for.
36. Learn the Difference Between Want and Need
One of the biggest personal finance cripplers is failing to distinguish between necessities and wants. Needs are basic items like shelter, food, healthcare, and insurance. Wants are new cars every few years, cable, dinners out, and more.
37. Sleep on a Big Decision
Say you want to make a big purchase such as a newer vehicle. Instead of completing the sale while you are at the dealership, walk away, come back home, and think over your decision by analyzing the pros and cons of this purchase, then sleep on it. By taking a step back and giving yourself time, it provides the clarity you need to make the smartest decision.
38. Find an Accountability Partner
If you have a parent or friend who possesses excellent money management skills, ask them to be your accountability partner. What this entails is you share with them your financial goals and give them updates on your progress. By sharing your goals, they can help you remain focused while also sharing tips they used to achieve financial success.
39. Reevaluate Your Finances Often
Once a month, go over your finances to make sure you are on point with your goals. This also provides you with insight on spending patterns that might be occurring, opportunities to save more money, or ways to eliminate an expense.
The Best Ways to Save Money Recap
Even if you don't make use of al of these tips, sticking to just a handful can help you save quite a bit every week. You don't have to live extremely frugal to be a Money Saving Pro, you just have to understand your financial habits and work toward cutting out your money-wasting habits. Know someone who could use this advice? Feel free to share this and other
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