10 Tried and True Ways to Save Money
Saving money is a goal many of us strive for, but it can often feel overwhelming. Whether you’re looking to build an emergency fund, save for a vacation, or just manage your daily expenses better, small changes can lead to significant savings. If you’re a seasoned saver or even if you’re just getting started, these practical tips will help you keep more of your money for the things that matter. Here are ten proven ways to help you save money.
1. Create a Budget
A budget gives you a clear picture of your income and expenses. The goal of budgeting is to compare your income to your expenses and setting priorities for your spending. A great way to start a budget is to follow the 50/30/20 budget rule: Spend up to 50% of your take-home pay on needs, 30% on wants, and 20% on savings.
2. Set Savings Goals
It’s easier to stay motivated when you know what you’re saving for. Set savings goals with a timeline on how you can reach them. Once you have a target, you can plan what you will need to save each week/month to achieve your goal. Let’s say you want to save up for a fall trip to Italy that costs $5,000. You can plan to save around $715 a month for 7 months, then you’re enjoying your Italian vacay!
3. Automate Savings Transfers
Work smarter, not harder by setting up automatic transfers from your checking account to your savings account each pay period. This method is known as “paying yourself first” and ensures you always save consistently.
4. Free Yourself from Debt
It’s hard to save up when you’re saddled with tons of debt. Once you’ve reduced your debt and interest payments, you are afforded the wiggle room to save more. If you can pay off debt more quickly by making extra payments or paying more toward the balance whenever you can, you will chip away at the interest and free yourself from the debt sooner.
5. Cancel Needless Subscriptions
Streaming services, magazine subscriptions, and unused gym memberships can quietly drain your bank account. Audit your monthly subscriptions and cancel or downgrade the ones you rarely use. Pro Tip: Set a calendar reminder to cancel free trial subscriptions before the trial ends.
6. Reduce Restaurant Spending
Eating out can add up quickly. If you’re purchasing take-out, ordering food delivery, or dining out multiple times a week, your food expenses can go sky high. Practice more money efficient (and healthier) options by cooking at home and meal prepping. In addition, meal planning and batch cooking can make it easier to stick to home-cooked meals. If you still want to incorporate restaurant meals into your budget, try saving eating out for the weekend and special occasions.
7. Shop Second-Hand
According to The Ascent, you can save between 25% and 50% by shopping second-hand. By shopping from thrift stores, consignment shops, and reselling marketplaces, you can save a lot of money. A great place to start is with sites like Depop or ThredUp.
8. Use the 30-Day Savings Rule
Impulse buying can throw your budget out of whack and leave your bank account strained. One way to limit impulse buying is by using the 30-Day Savings Rule. This rule states that when you are tempted to make an unplanned purchase, wait 30 days before committing to the buy. During this waiting period, evaluate the necessity of the purchase and how it will impact your overall financial goals.
9. Reduce Energy Consumption
Cutting back on energy usage lowers your utility bills. Taking small steps like turning off lights in rooms that you aren’t in, unplugging devices that aren’t in use, and using energy-efficient appliances like LED light bulbs can make big changes to your electric bill over time. Another great way to reduce energy usage is to install a smart thermostat to regulate temperature and save energy without manual adjustments.
10. Practice Smart Shopping
Sometimes the key to saving money starts with how you’re spending it. Practice smart shopping by making an effort to purchase things for the lowest price possible, and/or getting the biggest bang for your buck. Time out your purchases of more expensive items like furniture and electronics around sales events. Buy in bulk for non-perishable items. Use coupons for everything from grocery runs to online shopping. Being a diligent and smart shopper can lead to significant savings.
Disrupt Gives is a nonprofit organization focused on preventing homelessness and promoting long-term financial stability through rental assistance and financial literacy programs. Our financial literacy workshops are designed to educate individuals on budgeting, saving, credit management, and financial planning. These workshops provide practical skills and knowledge to empower participants to make informed financial decisions. For more information, visit https://disruptgives.com/.