There’s a common misconception that saving money is easy. You just have to stop buying expensive stuff. Right?
Let’s be real here. How often do you purchase items that cost more than a couple of hundred bucks?
If your answer is different from “every other day”, cutting on the luxurious shopping probably won’t cut your average monthly expenses by too much. These six easily actionable tips will.
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1. The Four Envelopes Strategy
Like most worthwhile endeavors in life, the art of saving money starts with a foolproof plan. The envelope system is one of the most prominent strategies. Originally brought into the mainstream by Erin Lowry’s Broke Millennial, the system has caught on and was expanded upon by dozens of financial advisors.
The system is fairly simple, and all you’ll need to start using it is an investment of a dollar or so as you do require a couple of envelopes. Once you are done with your visit to the local post office the fun part begins.
Calculate your essential monthly spendings such as rent, mortgage, car bills, commodity bills, etc. That’s envelope number one.
Now think about the money you’d like to save for something special. It is generally recommended to save at least 30% of one’s income, but this is more of a general rule of thumb than a strict rule.
You probably know how much you can afford to save better than an army of online experts.
In either case, your savings go to the envelope number two.
Whatever you are left with is divided between envelopes three, four, five, and six. Those contain your budget for every week of the month. You are not allowed to spend more than you have in each.
Yeah, the system sounds pretty simple, but the sheer power of visualizing how much money you have (or need) has more magic than the entire Harry Potter franchise.
Source: fool
2. Stop Overspending (Needlessly)
Every retailer offers discounts. Most businesses run multiple marketing campaigns allowing you to save with special deals or coupons.
Yes, most of these deals are usually nothing to write home about but saving even a dollar on every item you buy throughout the month stacks up. So much so that there are people who specialize in coupon shopping. They combine deals from stores and manufacturers to maximize the discount and wait patiently for everything to alight perfectly.
Talk about patience being a virtue. “It takes a very special kind of person to become a professional coupon shopper. The dedication needed to invest both the time and effort into mixing the perfect combination of printable and online coupons for the sake of saving takes the pleasure away from the equation” says Ioan Gerosanu, PR manager for dontpayfull.com.
3. Stop Overspending (Irrationally)
We are probably making saving sound a bit simpler than it actually is, especially given that the desire to please oneself through shopping is one of our basic instincts.
An improper mindset paired with the brilliant marketing move that is the discount offer can lead you to spend more rather than less. 63% of shoppers admit to buying things they don’t need simply because it was on sale.
Shop wisely. Have a list and follow it to a T as this is the only way to come out of the marketing wars victorious, and with the stuff, you really wanted at a much better price.
Source: idahohomelandrealestate
4. Go for the Store Brands
There’s a reason why colossal bards and mega-corporations like Coca Cola, Pepsi, and such stay afloat. The big boys invest billions in marketing. Billions they’d like to make back in ROY.
A lesser-known brand can easily afford to sell the same product at a smaller price. The same brand, once supported by a major retailer, can go even further down to a fraction of the original cost.
That’s why bargain labels and store brands are the go-to choices for everyone willing to save a few bucks. And as it turns out, these “few bucks” vary between 25% and 50% off your weekly grocery bill. Neat!
5. There’s Always Room to Haggle
The 21st century is the age of services. There’s no shortage of providers. The market is highly disrupted by the capabilities opened by internet marketing and social media.
The competition between businesses is as hot as ever. Use it to your advantage.
TV, Internet, phone, gas, water, and electricity bills can all be renegotiated in a single phone call. You’ll need to use a magic phrase though.
Do you have your pen and notebook ready? Ok, here goes.
The secret phrase is: Hi, I’d like to switch to a different provider.
Speak the magic words, and you’ll be bombarded with discounts and loyalty bonuses to a point where you’ll be feeling sorry for your service provider. (Don’t be though)
Source: money
6. Cut on the Extras
There’s a lot of stuff continuingly draining the bank account that you don’t typically notice. Take your landline telephone for once. You haven’t used it in ages. Why are you paying for it then?
Then there’s a cup of coffee you grab on your way to work. You love the place, the barista is super cutie, and their pumpkin latte is simply out of this world.
Sure, a cup of coffee doesn’t seem like that big of a deal, but if you are drinking it every day that’s a couple of hundred bucks per month you could have been saving. Besides, no one has died from brewing their own coffee to go so why pay more?
You’d be surprised, but it’s the little things like these: coffee, snacks, junk food, etc. that are eating up most of your monthly budget. You are spending more on them than you do on leisure like having a nice night out on a Friday. Is a bag of chips worth it?
