It’s not easy to save money in today’s world, and it seems everyone puts their hands in your pockets no matter how deep they are. I consider myself a cheap person, but when I say cheap I mean I don’t like to spend my money, I prefer to have more than not enough, so I decided to give you five easy tricks on what I do to save money.
1- Open a savings account
Open a savings account in a different bank than where you have your main bank account. I personally use ING direct and each week they take an amount out of my main bank account and save it in their vault (figure of speech) this way I forget about it and never use it. I prefer not being able to see the money when I log in my main bank web interface this way I am less tempted of using it. Remember there is no point in saving money if you keep spending it.
2- There is nothing wrong in being cheap
Yes, being cheap is a good thing, cheap people have money but don’t spend it. There is no point in buying a 5$ cup of coffee everyday in the morning. If you go to the restaurant make your meal with the price and not what you want to eat. That 15-20$ steak is not worth it, eat the salad at 9.99$. Try to avoid those daily expenses that you really don’t need. For example don’t eat breakfast at your local coffee shop each morning and don’t buy chocolate bars, muffin’s or anything that you don’t really need to eat. If you look at it this way 5$ per day is 25$ per week that 100$ per month, at the end of the year is 1200$ in your bank account ( + interest)
3- Lower your monthly recurring expenses
A business always tries to cut cost and keep their recurring expenses as low as possible. This said you should also try to do the same even if it means changing some habits. I do not watch TV, right there I save over 50$ per month on a cable bill. I am still amazed when I see people spending over 600$ a year on something as unproductive and unhealthy as TV. Change your land line for a VoIP line, lower your wireless phone bill by not using it all the time or even better stop sending text messages and the internet on your phone.
4- Shop and compare prices online before you go bargain hunting
One of our biggest expenses is food, yet it’s also a purchase we cannot run away from. Regardless of what we do we always need to eat. The average American family spends more than 30 percent of their monthly budget on food, according to the Economic Research Service. There are many supermarkets so go online and compare prices for the products, use discounts to save on products you often buy. It’s also a good idea to stock up when there is a special on meat or something you particularly enjoy.
5- Make a budget
It’s good to make a budget once in a while to know where all your money is going. The best way to make a budget is to keep all the receipts from your cash purchases and use your Credit Card statements and online banking service to get all the needed information. Don’t do a budget with your memory or with approximate numbers, most people imagine that they are smart spenders when that is not the case. You might be shocked on how you actually spend your money. If needed you can keep doing the exercise each month, I personally believe that doing it each quarter is good enough.
6- If you can’t afford it DON’T buy it
It’s really surprising how most people don’t get the simple concept that credit is not meant to be used on things you cannot afford. If you don’t have the money for a product don’t buy it on a credit card with 19% interest rate. The 1000$ TV will end up costing you 1200$ or more by the time you paid it back. You’ve probably heard that the average American carries more than $8,000 in credit card debt, that is insane considering the interest rates.
These are just a few tricks on saving money and putting more in your pockets. Remember all those added fees add up at the end of the month and sometimes a few changes in your lifestyle can save you hundreds of dollars per month. It’s time to stop spending and start saving!