How To Live Cheap – Who doesn’t want to save money? It’s probably the first mantra we all grow up hearing.
It could mean something as simple as cutting down on Starbucks or avoiding a daily visit to restaurants; we all look for ways to leave something in savings after the unavoidable expenses.
If you’re seeking fresh ideas on how to live cheap and save money on your day-to-day life, you’ve come to the right place.
How To Live Cheap: 20 Ways To Save Money
Keep reading this article for 20 best tips on how to live cheap and start saving money to achieve your financial goals.
1. Set Savings Goals
What savings goals do is to help you visualize the actual reason you need to save. It stirs that motivation.
So, when you have the specific goals in place, with timelines of when you expect to achieve them, it becomes easy to pull cash aside. Let’s say you plan to buy a car in one year from now. Now, that’s a target that reminds you to live cheap month-on-month.
2. Eliminate Your Debt
Now, this is very crucial. Debt is a more significant threat to your saving objectives than anything else. If you want to know how much a debt-free life will help you save, add up how much you spend paying your debt each month, and it’ll become obvious.
So, once you’re free from paying any debt and its interests, you can channel that money into savings. But if you’re not in debt yet, do everything to run from it.
Credit cards have probably made things worse, forcing people to live above their means. So, make it a priority to stop using your credit cards. And when you do, pay them off as quickly as possible, to avoid accumulating interests.
3. Pay Yourself with Auto Debit
Interestingly, many banks have made saving much more straightforward, with automated transfers between your checking and savings accounts.
It’s up to you to choose when, how much, and where to transfer money. It’s even possible to have this split before your pay gets into your account.
That means you don’t even see it, so you can’t spend it in excess. Whether it’s $50 every two weeks or $500 in six months, give this the priority it so much deserves.
4. Quit Smoking
Agreed, this doesn’t happen magically, but that’s not the same as impossible.
Let’s do the math: if you smoke a pack and a half every day, that amounts to nearly $3,000 annual savings if you quit.
Don’t listen to your mind that it’s impossible to quit. The health complications and financial implications are forcing people to quit smoking daily. Don’t hold back.
5. Choose “Staycation”
With the idea of vacation also comes staycation. Think of how much you can save from suspending that $10, 000 vacation in Buenos Aires. So, instead of dropping several thousand on airline tickets overseas, why not look for somewhere much closer to home?
6. Offload Home Maintenance Costs
It’s surprising how much cost you can offload from improving certain things in your home. For example, let a certified contractor do a complete energy efficiency review of your home.
It could be as simple as reinforcing the sealing windows and doors to installing new insulation. You can also realize the need to use a gadget less, which could save you thousands of overtime.
7. Save on Utilities
Live the cheap way with utilities like a thermostat. When you lower the thermostat on your water heater by 10°F, you can save up to 5 percent in energy costs.
Also, you can have an on-demand or tankless water heater in place of a standard storage-tank water heater. This alone can shave 30 percent off your utility expenses.
Related: How to Save Money on Utilities
8. Ditch the Workplace Lunch
You can’t possibly spend the same amount to cook from home and buying launch at work. You may only need one-third of your $9 meal to make something delicious from home. That will leave you with about $1250 in savings by year-end.
9. Use an Interest-Bearing Account
Savings options such as Regions CD or Regions Money Market account reward you for taking the pain to save.
It’s good enough that keeping your savings separate from your checking account helps reduce the tendency to borrow from there now and then. But what’s more interesting is that these accounts have higher yield rates, especially if your goals are long-term.
10. Annualize Expenses
It’s easy to overlook unnecessary expenses when it’s just $5 or $10. But you’ll be shocked to know what that $10 will amount to in a year. So, if you pay that for office snacks each day, that’s about $2, 500. Imagine what that can do for your target.
11. Record Your Expenses
How much do you spend – in a day, week, and month? This is where to begin your savings journey. You’ve got to keep track of all your expenses. Outline them in categories, and get the total.
To get through this quickly, you may need to check-up your credit card or bank statements.
12. Spend within Budgets
Sit down, and take a look at your likely expenses in a month. By this, I mean the key things you need – groceries, food, transport, and the likes.
This will help you organize your expenses into a workable budget. It will outline how your costs measure up to your income—so you can plan your spending and limit overspending. Don’t forget to include regular needs, like car maintenance.
13. Assemble Your Tools
There are a few things to put in place to help you maintain alignment when saving.
For short-term goals, consider using savings deposit account, or fixed deposits for a specified period. For the long-term targets, FDIC-insured individual retirement accounts (IRAs), and securities, such as stocks or mutual funds are your best bets.
14. Use Coupons
This sounds simple, but coupons are one of the best ways to save money consistently.
Check online for coupons and shop the coupons with the sales to increase your savings. Think of buying that new $400 TV when it’s going at $50 off. Get some free voucher that’s usable at that restaurant, and for more things you like to do.
And again, sign up for newsletters and loyalty programs at your favorite stores to stay in the know on best deals. You can also take advantage of handy tools like The Coupons App, SnipSnap, Cartwheel, all of which help you find and save deals for various purposes.
15. Buy Online
E-commerce does more to get people to buy than your regular physical store. So, you have more chances of getting that smartphone you’ve always wanted and other things at a much lesser cost online. Check out stores that offer free shipping on orders to get the best deals.
16. Skip Paid Concerts
Your love for concerts may be the leaking hole in your purse. But a free show is a handy alternative for you. In many cities, free concerts happen quite frequently.
Over the summer, there are bulk of opportunities to do fun things at a reduced price. These include movies out on the lawn, free concerts, and festivals.
17. Avoid Health Complications
Much more than you expected, health complications could sap into your purse deep. So, put in the effort to maintain your health. Skip the junks, and get your fitness goals straight.
However, for emergencies, get yourself health insurance. This should cater for free annual physical checks. Then again, don’t nurture sickness. Taming a cold before it turns into pneumonia can save you money, and days off of work. So, don’t wait to visit a doctor.
18. Plan Your Meal
Before shopping for groceries at the weekend, get your plans in place of what goes for every meal. Make a list of what you need, and pick only just those.
Without a list, you could forget an essential ingredient for a meal, and you’ll end up eating at a restaurant or ordering a pizza rather than eating at home.
One thing is that meals cooked at home cost much less, but again, they are not as stuffed with fat and calories like dishes available at restaurants.
19. Dump the Gym
Exercising is vital to keep you fit, but that monthly subscription to the gym isn’t necessary. That’s especially true when you don’t have all the time in the world to visit most days of the week.
Instead, you can jog around the neighborhood, ride a bike, or follow the instructions on a workout video at home.
20. Avoid the Lottery
It’s easy to get tempted by news of people recouping millions from a single bet. But while there is a chance you could win, the possibility is much less than being struck by lightning or getting hit by an asteroid. What hope is in that?
Instead of spending your money on that, stash it in your savings or invest in a retirement account that may pay off one day.
Imagine investing just $20 a month every month over the next ten years at a 6.5% interest rate; you’ll end up with nearly $10,000 at the end of 20 years, and more than $45,000 at the end of 40 years.
Beyond all these tips on how to live cheaply, it takes deliberately planning your expenses and organizing your lifestyle to save. Get your budget straight, and run away from whatever escapes the circle of ‘need.’
So, before you leave for the store, or even off to work each day, be exact on the benchmark that determines what you must spend.
Let us in. What strategies have you adopted to up your saving game? What is your best tip on how to live cheap? Let us know in the comment section below.