Are you having a hard time saving money? Can’t figure out where your money is going? Then these 6 tips to cut expenses and save money is for you!
by Kimberly Pangaro | Kimberly is a mom of four daughters and the owner of the lifestyle parenting media company Atomic Mommy. When she’s not running her company or momming all day, she’s writing about family life.
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In order to save money, cutting down on spending seems like the obvious thing to do, but if it’s so obvious then why are so many people in debt?
The truth is, saving money sounds amazing–in theory! If we could all do it, then none of us would have credit card debt, student loan debt, or bills piling up on the counter.
So, whether you’re a mom on a budget, a dad looking to save for that sweet new ride, or even paying your way through college, here are some amazing tips to help save money.
#1 Quit the Starbucks Habit
Hey, I’ve got nothing against Starbucks… I love you and miss you!
But the truth is, my money is worth more to me than a gourmet cup of coffee. When I sat down with my bank statements and added up how much I spent, I couldn’t believe my eyes. Just on Starbucks alone, I was spending $97 a week! That’s $400 a month and $3,600 a year. And that was just for me! I can’t tell you how many weeks there were back in the day, where my husband and I were going 2, 3, and even 4x a week at a cost of $15 each time.
Sadly, I said goodbye to Starbucks and Hello to Mr. Coffee. At the time I bought it, circa 2019, I paid a whopping $25! To save extra cash, I also bought a reusable coffee filter–it was totally worth it!
Nowadays, I make my coffee at home and with the amount of money I saved by not buying the gourmet brew, I was able to add more funds to my bank account.
In one year, I managed to save over $4,000 and I was able to use that towards a down payment on my house.
#2 Cancel the Cable Company
We’re all programmed to pay the high cable prices, but why? It took me a while to ‘cut the cord,’ but since then, I haven’t looked back!
In order to pursue this dream of canceling cable, I bought a Smart TV that allowed me to download streaming apps.
Here’s the good news. You can watch cable television completely free when you download apps like Peacock or Pluto TV onto your television. And by subscribing to Netflix, I ended up with a bill that was a fraction of my cable bill!
Here’s a tip to help you do this with the least amount of funds and stress. If you don’t own a Smart TV, buy one on or around Black Friday. The sales are incredible! A couple of days before Black Friday, I bought my 55 Inch Samsung 4k Ultra HD TV for less than $600. To give you an estimated amount of savings versus cost, I’ll break down my cable expenses from 2019.
My cable bill used to be $235 per month. Netflix was $15.99 (it has since gone up). I bought my Smart TV for $600. When I canceled my cable, I opted to go with another company for just the internet. That bill was $95 with taxes and fees.
So, add that to the Netflix cost and in two years time, I managed to save over $2,500… Put that in your wallet!
#3 Stop Impulse Purchasing
Let’s face it, shopping fills some sort of emotional need! How many times have you seen something cute online and thought, “Hey, it’s only $10.” and then pressed add to cart? But then you see more items on sale and you decide to add those, too.
While this sounds manageable, online shopping is addicting, especially during sales. Online stores know what they’re doing when they strategically place items on sale and ads on the sites you normally visit. They get you to impulse buy or buy without thinking. Heck, I’m guilty of it, too!
So instead of binge shopping, make a list of the items you need to buy and stick to it. Then do a review of your cart items and delete anything that you may have added that’s not on your list. By doing this, you may be able to save a ton of money!
#4 Quit Overpaying for Insurance
It’s easy to stick with the same insurance company for many years. Why go through the hassle of finding new insurance, right?
There’s one reason – savings.
When you stay with the same provider, they typically increase your premiums with each renewal. It’s often just enough to not startle you, but if it happens every year (or every six months for car insurance), the increases add up.
I noticed my premiums increased by $10 a month. I figured it wasn’t a big deal until I realized that’s $120 a year and $600 over 5 years. If you have multiple policies, the increase can be even more.
My recommendation is to shop around for the best savings on car, home, and health insurance (unless employer-provided) each year. Changing companies may save you a significant amount of money each year. Just don’t be tempted to give up your insurance altogether because as any car and motorcycle accident lawyer can tell you, you could get into a world of trouble by doing so, and the same goes for health insurance too.
#5 Stop Using Credit Cards
Credit cards are known for having high interest for consumers. If you’re one of the financially prepared people out there and have a 740 credit score or above, you probably own a few credit cards that offer 0% interest.
But if you’re like me with less than great credit, then you are likely paying over 25% interest on your cards. Think about that for a minute. For every $100 you spend, if it takes you 6 months to pay that off, you are literally paying the credit card company $7 in interest.
Credit cards shouldn’t be an extension of your income. A good rule of thumb to follow is if you use credit cards to pay for items you can’t pay for in cash, then don’t buy it. I know that’s tough because there are emergencies that are outside of what a regular emergency looks like.
As a mother, I can tell you all too well that I have had to use credit cards for the occasional purchase of diapers and formula. So, I’m with you. It’s hard as heck to learn to live a “Just Cash” life. But it is worth it in the long run.
In case you are keen on finding out how much you’ll pay in interest while paying down your balances, with interest and in a certain time frame, you can use this calculator.
#6 Stop Eating Out
I know heading to a convenient drive-thru or taking the family out to a restaurant, especially after a long week of drop-off’s and a crazy work week, seems like a good idea but ask yourself this question the next time you’re driving there, “Is it worth it?”
Here’s why you should quit eating out. Let’s use a personal example. As a mother of four, we were always on the go to some practice or game or family event. Cooking was the last thing I wanted to do in between all the pick-up’s and carpools. We would visit one of the fast food chains at least once a week. For the four kids, the total always amounted to around $40.
When I realized how much that was per year, I was shocked! That one weekly trip was costing me $2,080 per year and that didn’t include the big family dinners at restaurants.
To save money, I opted to pre-cook my dinners and to plan the car snacks. Doing that saved me a bunch of time, stress, and you guessed it, money!
Changing these 6 habits will help you save money and fatten your bank account every month. These aren’t drastic changes, you will see that you gained abilities to do more with your savings.
So whether growing your emergency savings or investing in the future, understand that a little sacrifice today leads to financial freedom tomorrow.