Cut These 6 Expenses And Watch Your Savings Skyrocket
Is your savings account looking small these days?
Whether you’re looking to retire early or have money for life emergencies, the key to a strong savings account is keeping the money you earn from working, side hustles, or any passive income streams.
Sit down for this revelation, but the best way to save money is not to spend as much. Addressing these six problem areas will likely lead to extra money at the end of the month if your willing to listen to the advice.
The 6 Expenses To Cut Now
Here are the five expenses to cut—or drastically reduce—almost immediately that will save you more money each month.
Eating out
If you read any online article about saving money, one of the suggestions is always to stop eating out. Yet, people continue to eat out with little money in savings.
Spending money in restaurants took a sharp dive in 2020 because of the pandemic, but those numbers will likely rebound now that the country is completely reopened.
Cooking at home is way cheaper than eating out – or ordering take-out – and if you’re really not a great cook, there are meal-order kits that make the process pretty darn simple.
Gas
With gas prices reaching an all-time high, now is the best time to rethink how often you use your car for unimportant reasons.
Taking public transportation, getting rides off friends and family, riding a bike, or just walking are always options, but here’s one idea the article doesn’t offer – don’t go as many places. Often, people will leave the house to leave the house.
This is fine as long as you’re not burning gas to get to wherever you don’t have to be and then possibly spending money once you arrive.
Clothes
According to stats collected from the Bureau of Labor Statistics, the average American spent $1,883 on clothing in 2019.
Unless a job demands you look your best, spending money on high-end clothes doesn’t make much sense. Shopping around for less expensive items like suits and shoes is the best idea and selling the clothes you never wear is a way to pad your savings.
Alcohol
The average amount spent by U.S. households on alcoholic drinks is close to $1,000. If you’re looking to reduce this cost, the most effective way is to give up drinking altogether. Duh! However, if that’s not a viable option, consider purchasing alcohol from a warehouse club to save money. The cost savings can then be redirected towards your “Financial Independence, Retire Early” (FIRE) goals.
If you’re not a member of a warehouse club, don’t fret. Some chains, like Sam’s Club, allow you to purchase wine, beer, and spirits without a membership. By doing some research and seeking out cost-saving opportunities, you can still enjoy your favorite alcoholic beverages while keeping your expenses in check.
Cleaning Supplies
Keeping the house clean is important, but there’s no difference between a $6 bottle of counter cleaner and a $2 bottle.
“This category includes laundry detergent, which can be expensive. You might be surprised to learn that you might not need laundry detergent at all on lightly soiled clothes. But if you do need detergent, it’s relatively easy and inexpensive to make.”
As the article points out, in most cases, homemade cleaners work just as well and can be made cheap.
Vehicle Expenses
The average amount spent by U.S. households on vehicle purchases is almost $5,000 per year. However, there are ways to avoid this cost, such as extending the lifespan of your current vehicle. By doing so, you can eliminate the need to buy a new one altogether.
If you do decide to make a vehicle purchase, consider buying a gently used, late-model car instead of a brand new one. This can save you a significant amount of money while still providing you with a reliable mode of transportation. With careful research and consideration, you can make a smart and financially responsible choice when it comes to purchasing a vehicle.
Other Major Drains On Money
The article makes a few other suggestions for cutting costs, like rethinking how – and where – you live. Since a house is typically an individual’s biggest expense, the article suggests finding a roommate or occasionally renting out the house on Airbnb when you’re not around.
This suggestion likely doesn’t work for most people who already have a family living in the home and don’t live in a desirable enough area for steady Airbnb rentals.
The other propositions for saving money include rethinking grocery store purchases and vehicle purchases. Do you really need a brand new car every few years? Does the store brand version of food tastes that much different than the higher-end brands? The answers are no and not really.