What does it mean to save money? We all understand the concept: Squirrel away more than you shell out. But fewer of us understand how to do this successfully. When debts are mounting up or your job isn’t paying you what you deserve, it’s easy to fall into the mindset of living paycheck to paycheck – which means there’s no wiggle room for saving.
But this doesn’t have to be the case. Let’s take a look at a few very simple measures you can take, starting RIGHT NOW, to launch your journey to saving money.
1. Document, document, document
You know what they say: Get it in writing. Make a habit of writing down your purchases. Every single one… even that pack of gum. By creating a simple spreadsheet (or using one of the many, many money-tracking apps out there today) of exactly what you are paying for, you’ll see trends. This is an eye-opening way to see what is going out – and what expenses are totally unnecessary.
2. Only pay cash
Talk about eye-opening: Research confirms that consumers spend way more when using credit cards instead of cash. There’s clearly a psychological component to this – handing over cash feels harder to do than handing over your plastic. So consider a “cash diet.” Give yourself an allowance on a regular basis, and only buy things with this allowance. And if your cash runs out, wait to make another purchase until your next scheduled allowance. And try taking this a step further: Once a week, challenge yourself to not spend a single dollar on a designated “no-spend day.”
3. Love your kitchen
Cooking at home is one of the best ways to save money. Just thinking about all the money you spend on restaurant bills (made all the easier once you’re dutifully logging all those dining charges!) might make you cringe, especially if you consider that the average restaurant meal costs roughly $50 for a family of four. The more food you can make at home, the less you’ll be spending on your food budget. As an added benefit, cooking for yourself or your family tends to be a healthier choice than eating at a restaurant.
4. Make leftovers
While you’re in the kitchen, consider spending time prepping two of everything. Lasagnas and casseroles are especially freezer-friendly, but there are infinite options for recipes that do well when reheated. Making larger quantities of your main dishes will leave you with leftovers to pack for tomorrow’s lunch, thus eliminating even more from your dining-out expenses. Or get yourself a crockpot to whip up a large batch of dinner. Not only are crockpot meals super economical at around $2 per person, but the machine also does the work while you are away.
5. Stick to your list
Now that you’re cooking more, create a weekly menu to guide your grocery shopping. Only buy what’s on your list. If possible, only go to the store once a month – the less time you spend in the grocery store, the less money you’ll spend because there’s less time to be tempted with impulse buys. Also, never shop hungry. An empty stomach makes everything look appealing. Without realizing it, you’ll wind up with a cartful of unnecessary items.
6. Stop stopping for coffee
If you enjoy that daily morning latte from the corner cafe, you’re likely spending a thousand bucks a year just to get your coffee fix. Say you spend $4 for your beverage every weekday on your way to work. That comes out to $20 per week… and $80 per month… and $960 per year. And that’s on the conservative side, excluding any additional mid-day pick-me-ups. Sure, a coffee maker can be a bit of an investment, and gourmet coffee beans and flavored syrups can be a bit pricey – but you’ll save so much more in the long run by brewing your own cup of joe.
7. Just unplug
If you’re like the average American household, you own something in the neighborhood of 25 consumer electronics – and you’re spending upwards of $100 every year powering them. Did you know that those devices use electricity even when they’re off? There’s a simple fix that will save on your electricity costs: Plug your devices into power strips, and then switch the power strips off at the end of the day. Also, be sure to plug in your devices to charge them during your electric company’s off-peak hours.
Have you tried – unsuccessfully – to implement savings strategies? Have you established some of these good habits but you’re still struggling to make ends meet? Sometimes all it takes is a good conversation with someone who really understands. Contact DebtGuru.com today, and one of our friendly financial advisors will help you strategize other solutions that make sense for you.