If your pockets are feeling a little light these days, it might be time to re-examine your financial habits and explore ways to start building a cash reserve instead of spending it. The good news is that there are a number of creative ways to cut spending from your daily and monthly habits. Here are five things to consider on your road to saving $5,000.
1. Cancel unused and unneeded services. Think about where you can reduce or eliminate reoccurring expenses quickly and easily. If you’re a cellphone and landline owner, consider canceling your landline. It’s an unnecessary service if you have a mobile phone, and it can add upward of $30 to your monthly bill. And don’t forget to look at your cable bill, which might be costing you over $100 per month. Instead, consider switching to a service like Netflix or Hulu that will only set you back about $10 a month.
The cost of monthly subscription services and memberships can also sneak up on you. If you’re experiencing more financial strain than pleasure, cut those indulgent items from your budget, and pocket the cash for items you really need. Another easy way to save money is to opt out of services like housekeeping or pet grooming and instead take on those tasks yourself.
2. Cut down your energy use. Energy and water bills, especially during the hottest and coldest times of the year, can really take a toll on your wallet. As most of the country is in a freeze right now, there are a few easy and inexpensive things you can do around the house to lower your heating bills. Insulating your pipes and hot water tank (even with towels) will help with efficiency. Closing your blinds can help prevent heat loss, and unplugging electronics when they are not in use is a quick energy-saving fix. Also, think about making an upfront investment in a smart thermostat, like the Nest Learning Thermostat, which has features to conserve energy when you’re not at home. These types of smart thermostats can save you money on your energy bill in the long run.
3. Shop smarter. Food is another expense that’s easy to slash. Before heading to the store, sit down and plan your meals for the week. Remember that cooking bigger meals you can eat over multiple days is a great way to cut down on the per-meal cost. Arm yourself with a shopping list before you hit the market, and don’t shop hungry! This will make you less tempted to buy items that you might want but don’t need. Always bring your reusable grocery bags, especially if you live in an area that charges for paper or plastic bags. At the store, shop generic brands for major savings, and buy in bulk when appropriate. Also, consider becoming the coupon king or queen of your household by planning meals around what’s on sale each week.
4. Go out less. Saving money doesn’t mean sacrifice. One way to save is simply to cut down on the frequency of times you go out and pay for entertainment. Supplement going out to eat with cooking meals at home. Host a game or movie night with friends instead of meeting up for an expensive dinner and movie. If you’re hosting an event, suggest a potluck where guests bring their favorite dishes and drinks. While “staying in” may not be as exciting as a night on the town, it will save you money on food and drinks, tickets and transportation. Alternatively, jump online to look up free events in your area so you don’t miss out on the latest gallery opening, movie in the park or comedy night.
5. Pick a savings companion. Saving money doesn’t always come naturally, so bring someone else along on the journey. Whether it’s a friend, family member or partner, enlist a savings companion to help support you. Another person makes it easy (and fun!) to exchange tips on how to shop for the best deals, negotiate your cable bill or trade off on hosting meals. Plus, when you’re tempted to spend on something unnecessary, you’ll have someone to talk you out of the purchase.
Now that you have re-examined your spending habits with a savings goal in sight, the next thing to think about is what you’ll do with that pocket full of cash!