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Every new year, we make many ambitious goals.
You may have goals of adopting a better lifestyle by eating healthier, exploring new corners of the world with your friends, or even making a simple promise to yourself that you’ll sleep earlier.
Regardless of what your goals are, there’s no denying that every one of us wants to save money and live better!
According to a survey conducted by Bankrate, 1 out of 5 working Americans aren’t able to save money from their annual income.
With more money in your bank account, you can pay off your debt, buy a new car, put a downpayment for a house, or finally save for retirement.
It’s true that the cost of living had gone up a lot, but many people fail to save money because it’s not their top priority.
Like all things in life, if you put your mind to it and make your goals a priority, you will definitely see results.
Here are the best money-saving tips that your grandma will tell you to follow to achieve financial success. Even a recession won’t scare you!
1. Pay Yourself First
Many people try very hard to save a portion of their paycheck after paying for expenses. Your expenses may include things like:
- Housing – rent/mortgage payments.
- Transportation – car insurance, gas, and monthly transit passes.
- Food – groceries, take-out food, and restaurants.
- Healthcare – medication.
- Debt repayment – interest and principal payment on loans and credit cards.
- Recurring payments – cellphone and internet bills, and monthly subscriptions to services.
- Entertainment – shopping, dining out, movies, etc.
When you approach savings this way, you’ll likely run out of money paying others before your bank account gets any love.
Turn things around by PAYING YOURSELF FIRST.
Automate your savings by setting up an automatic monthly transfer from your checking to your savings account when you get paid.
You need to be the first person in line for your money – not restaurants, not Amazon, and not your cellphone provider. You worked hard for it so you need to be paid FIRST. This will protect you from financial hardship when the economy turns south.
Take care of yourself first because no one will be willing to help you when you need money in a recession.
2. Create a SIMPLE Budget
Budgets are not sexy.
BUT it’s much sexier than being broke and not having any money!
If you ask me, I would pick budgeting over being broke for the rest of my life any day.
Look, budgets are not supposed to suck all the fun out of your life and turn you into a cheapskate. It’s far from it!
I know it’s a challenge for beginners to create a budget that actually works – that’s why this very affordable Ultimate Power-Up Budget Binder was created for people who struggle with their day-to-day finances.
A budget is just a way for you to track and manage the money that is going into and leaving your bank account.
If you’re new to budgeting, try a simple budgeting system like the 50/30/20 Rule.
With the 50/30/20 budget, your monthly paycheck is allocated in this manner:
50% of your paycheck goes to “needs”
30% of your paycheck goes to “wants”
20% of your paycheck goes to “savings & debt repayment”
This simple budgeting system will allow you to build your savings while still giving you room to live a little.
Related post: How To Create a Budget For Total Beginners
3. Reduce Your Monthly Bills
Are you paying the advertised price or “sticker price” for your cellphone, cable, and insurance services?
Isn’t everyone paying the same prices for the same services, you ask?
Unfortunately, the answer is no.
Companies want to charge you as much as they possibly can for their products as long as you don’t complain and cancel the services.
Customers that take the time to ask and negotiate for better prices with service providers often end up getting a discount. (YES – you can be one of them!)
Search online for current promotions offered by your current service providers and their competitors for better deals.
Once you know what the current offers are, contact your service providers and negotiate for better prices!
Call your cellphone, internet, and insurance providers can tell that you’re paying too much for your current plans. Remind them that you’ve been a loyal customer and you’re not afraid to take your business to their competitors if they can’t offer you any discounts.
You could save $1,000 to $2,000 every year with a few phone calls.
Reducing your recurring monthly expenses is one of the best ways to save money. Make those calls today!
4. Stop Trying to Keep Up with the Kardashians
There’s not a day you’re not bombarded with social media feeds or new reports about Kim K’s lavish lifestyle.
From big mansions with walk-in closets the size of your room, a fridge stocked with food that can feed you for a month, to flying a private jet and posting it on Instagram with the caption, “cramped.”
These are not the average people that earn an average salary. So don’t compare your life to theirs!
Sure, you can buy brand name products. But only if it makes you happy and you can afford it.
Don’t go into debt (using your credit card) trying to dress your baby girl in high-end labels like Gucci. They’ll outgrow it in a year…
Think about what truly matters and makes you happy rather than trying to impress others.
Here’s a very powerful quote for you to think about.
“We buy things we don’t need, with money we don’t have, to impress people we don’t like.”
– Fight Club
5. Boost Your Income with a Hobby
Saving money boils down to a simple equation.
INCOME – EXPENSES = SAVINGS (OR DEBT)
You can save money by lowering expenses or increasing your income. It’s your choice.
When you’ve already reduced your expenses as much as possible and your savings are not growing as fast as you would like, it’s time to boost your income and make extra money.
Here are some ideas to get you started on your quest to earn more money:
- Take on extra projects at work or do overtime.
- Negotiate your pay with your boss.
- Find a higher paying job.
- Start a side hustle (e.g. start a hobby blog, tutoring students, become a Uber or Lyft driver, freelance work).
- Get a part-time job.
Like many struggling people, I SO badly wanted to earn extra money so I could save more, increase my income, and become financially independent, and that’s what led me to start a money-making blog.
I started this small and personal website on a whim, and I now earn over six figures a year with this blog. This allowed me to quit the job I disliked and today, I’m able to make money from home, working only 10-15 hours a week, on my own terms with no boss breathing down my neck!
I even logged my beginning blogging journey with income reports and proof here to show you that it’s possible for newbies to earn a full-time income online!
I am telling you, because I true heartedly believe in it, that ANYONE can start a blog and make money from home. If you are interested in starting your blog, I highly recommend you joining my exclusive FREE 7-day email course that will teach beginners how to start a money-making blog with no experience required.
The key is to find ways to monetize your skills and interests, which I talk more about in my How To Start a Profitable Blog E-mail Course when you sign up below.
6. Make Your Own Meals
Food typically eats up most of your monthly budget so it makes sense to find ways to reduce cost in this category.
Grabbing breakfast on your way to work is quick but it’s also very expensive. A bagel with cream cheese or breakfast sandwich will no doubt cost you anywhere from $3.00 to $6.00. When you make your own breakfast, you can easily save $1.50 to $3.00 a day or $378 to $756 a year!
When it comes to lunchtime, many people like the convenience of going downstairs to the food court to pick up their lunches. If this is your daily habit, it’ll likely set you back $7.00 to $10.00 a day. Why not save yourself $882 to $1,260 a year in lunch money by bringing your leftovers from the last night’s dinner or preparing your own healthy sandwich?
To make things easier, you can plan your meals ahead of time on the weekends to avoid stressing over what to make make and bring to work.
You can find countless healthy and affordable recipes online so not knowing how to cook is not an excuse.
Is the convenience of buying food worth $1,000 to $2,000 every year?
7. Learn How to Say “No Thanks”
One of the main reasons why you’re spending more money than you should is that you’re over-socializing with your friends.
Several nights out with your friends in a week may not seem like a lot, but the costs add up quickly. Especially when you have multiple groups of friends.
You don’t need to say “yes” to every dinner plan and activities your friends suggest to remain friends with them.
If your goal is to build an emergency fund or pay off your debt, you may need to reduce your monthly entertainment budget and kindly decline invites for a period of time to reach your goals.
Be open and honest with your friends. Tell them about your situation and why your goals are important to you.
True friends will understand that you have priorities in life and sometimes, you have to live within your means and stick to a budget.
Saving money could be as simple as saying “no thanks.”
8. Avoid Lifestyle Inflation
Does it boggle your mind that no matter how much you earn, your savings are not growing?
After you got a promotion or landed a better job that paid more, your bank account balance seems to be static.
This may be a result of lifestyle inflation.
This happens when your expenses rise along with your income. As you earn more money, you’re also spending more!
When you were a student, you didn’t mind sharing a place with roommates because you had no choice. Now that you’re working full-time, you moved out and are living on your own at the heart of downtown with an amazing lake view.
You deserve it, right?
Yes, you should improve your living conditions by getting your own place. But do you NEED a prime location or that breathtaking view? Probably not.
A better idea is to put your excess earnings into a savings account, use it to pay off debt, or invest the money.
If you’re not careful managing lifestyle inflation, you may end up living paycheck to paycheck even as a high-income earner.
As you can see, there are plenty of creative ways for you to save money and reach your financial goals.
After trying these money-saving tips, you’ll definitely notice a positive change to your piggy bank.
Saving money is not easy for many people, but it’s not rocket science.
It all starts with good money habits and being intentional with your money. Focus on things that make you happy and cut things that are a waste of money.
Start saving today and stop making excuses.