In this era of ever-growing expenses and accumulating financial responsibilities, you must learn to spend less money to escape undesirable financial cycles. With less money going to expenses and more to serve your financial goals, you can easily achieve your short and long-term financial goals sooner.
Are you looking for ways to spend less and save more? These tips, step-by-step, should get the job done for you.
1. Create a Budget
There are many reasons behind people living paycheck to paycheck, but one has to be a failure to create a budget. A study by Scwab in 2019 revealed that 59% of Americans admitted to living beyond their means.
Not having a budget lets you overspend and even go beyond what you make monthly. Spending more than you earn sets you up in a position to take payday loans before your next paycheck arrives. And when the next paycheck arrives, the money will be gone before you even realize it.
Have a concrete budget in place and ensure it reflects money you put aside for significant purchases, savings, retirement, emergencies, etc.
2. Track Expenses
If your money disappears and you never really know where it goes, it is because you do not track your expenses.
Tracking expenses gives you a clear vision of how you spend your money on specific things. With a clear record of this, you can easily see areas that take a lot of money and plan on how to fix them.
For instance, if you do not track your expenses, you will not know how much goes to varied expenses such as gas and groceries. But if you do, you will easily detect if you are spending too much and create a plan on how to cut down on such costs.
When tracking expenses is mentioned, it refers to tracking every coin you spend. It is not all about tracking money spent on major expenses. Overlooking small purchases quickly adds up and can throw you off.
3. Cook at Home
A study done by CNET revealed that cooking at home can save you up to an incredible 50% of what you spend on takeout.
While it takes more time and effort to cook at home, it can save you a lot of money and allow you to watch what you eat keenly.
If you want to cut your food costs, cook food at home and avoid takeouts and eating in restaurants. This applies to lunch, too; carry your home-prepared food for lunch at work. You can save between $2000 and $4200 per year by bringing your packed lunch to work.
4. Meal Planning
Another way to spend less money on food is to start meal planning.
Meal planning entails deciding what to eat in advance, using items in the house or what is on sale in your grocery stores.
Ideally, plan for a weeks-long meal, prepare them, cook in batches, and have them frozen to be eaten throughout the week.
This way, you will save yourself the extra work of thinking about what to eat before every meal. You also get an excellent chance to use what you already have instead of spending more money to buy more.
You will not only save money directly on food. You will also save money on energy used in cooking if you meal plan and cook in batches.
5. Use Coupons and Discounts
Many people underestimate how much using coupons and taking advantage of discounts could save them. Some consider it a cumbersome method of saving money as it may involve hunting and stacking many coupons.
You are losing out big time if you do not use coupons for your online and in-store checkouts.
One purchase could save you a few bucks. But how many purchases are you making? This goes a long way to show how much you can save if you take advantage of coupons.
Start using coupons offered on coupon sites and applications, those offered in stores, in mailboxes, and in newspapers.
6. Cancel Unnecessary Subscriptions
If you can go a week without using the subscription you religiously pay for, you can as well cancel it. It is a waste of money.
A lot of people forget about subscriptions, which keep renewing automatically. Some forget to cancel free trials and unknowingly pay for a service they do not use.
Since the subscriptions’ renewal can go unnoticed, it is better to track them from your bank statements.
Check out what you pay monthly but have not used in the last seven days, and immediately cancel it.
7. Buy Second Hand
Most gently used second items can go for as low as 50% less than the new price items. This is one of the reasons you should never buy new when you can find it secondhand.
Some of the best items to buy second-hand include clothes, baby clothes, baby items, shows, toys, furniture, house appliances, books, and cars.
Join local social media groups, use Facebook Marketplace, Vinted, and eBay, and go to yard sales and thrift stores to find secondhand items you need. You also want to ask your friends and relatives if they have anything they would like to dispose of before you buy new.
Just be sure to inspect the items before buying.
8. Limit Impulse Buying
An article published by Webtribunal revealed that Americans spend an average of $5400 annually on impulse purchases.
If you want to spend this amount less, you will have to plan your purchases, buy only what you need, and stick to your plans and budgets.
With clothes and shoes being one of the most irrationally bought items, you want to create a timeless capsule wardrobe. This way, you do not have to buy any trendy items that hit the internet streets impulsively.
Generally, you want to find hobbies other than window shopping, go shopping on a full stomach, shop with just the amount of cash you need, and postpone purchases for 2-3 days to think everything over.
9. Use Public Transportation
While we love the convenience private cars bring, they are undoubtedly ripping your wallet apart.
Fueling your car, maintaining it, getting insurance, having it cleaned, parking costs, and unexpected repairs can be outrageous.
If you want to avoid all the costs of buying and maintaining a car, embrace public transportation.
Ditching private cars for public transportation can save you up to $10,000 per year; keep this in mind if you are still thinking twice about crossing over.
9. Cut Utility Costs
With utility bills being one of the varied expenses, there is so much you can do to spend less on them. An article done by Bankrate revealed that the average American family spends $5,640.72 on utilities (including electricity, gas, water, water waste, broadband internet, and phone service). Electricity bills are typically the most expensive but also one of the easiest to reduce.
Start by doing a utility bills audit to find any loopholes and how to fix them.
The solution could be using electricity or whatever resource sparingly and efficiently or changing a service provider altogether.
10. DIY Projects
DIY projects such as making your decor, furniture, clothes, and toys can help you spend less money. Having to outsource everything to professionals can cost you a lot of money.
And this does not just apply to making items. You could mow your lawn, replace your air filter, change your car’s oil, paint your house, change your car tires, or fix a leaking faucet.
Learning these skills is not complicated. Simple online tutorials can help you save thousands of dollars spent on professionals doing these jobs for you.
11. Avoid Brand Loyalty
We get it; that brand impresses you, and you do not want to try anything else. However, if its prices are not doing your wallet any justice, you have no business watching your money going down the drain when you can find equally great brands at lower prices.
Those big brand names do not always guarantee good quality. You could almost find products of the same quality that work perfectly well for way lower prices.
This especially applies to food, toiletries, cleaning, electronics, and gadgets.
12. Automate Savings
Automating your savings is a powerful money habit that will help you effortlessly achieve your goals. Whether you are saving for a major purchase, an emergency fund, or your children’s college, automating your savings will make it feel effortless.
You can always manually move the money from your checkout account to your savings account. However, this is an action that is met with many temptations, and many times, people end up falling for it and not saving a coin at all. Avoid this blunder of spending to the last coin and automate your savings.
13. Limit Entertainment Spending
You will be fine quitting expensive entertainment and embracing free or budget-friendly options.
While there is no harm in going to the movies, you do not need to do it every other evening. The same applies to taking trips. Taking a yearly weekend trip may feel good, but doing it every other month could hinder you from achieving your long-term financial goals.
Limit what you spend on entertainment by embracing cheaper entertainment options.
14. Negotiate Bills
A study published by Avail revealed that 1 in 4 tenants have successfully negotiated for lower rental prices.
The secret lies in knowing how to negotiate bills well. It may not always be successful, but there is a good chance you could get some money slashed off that huge bill you vigilantly pay every other month.
Some of the other bills that can successfully be negotiated include hospital bills, rent, service charges such as HVAC maintenance, telephone bills, credit card interest rates, and insurance.
It does not harm to make that call; you never know how much more you will save.
Ways To Spend Less
Finding ways to spend less money can be helpful, especially if you are saving up for something that matters more to you, paying up debts, or looking to break the cycle of living from paycheck to paycheck.
For whatever goal you are working for, these 15 tips will help you spend less and save more. Embrace the tips discussed today and step closer to your financial goals.
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