Saving money is the most important step toward achieving a strong financial future. Yet for many American families who live paycheck to paycheck, finding the money to save can be a tremendous challenge. In fact, according to a survey by Bankrate, 20 percent of Americans don't save anything. Plus, many of those who do save aren't saving enough. One of the biggest problems for savers is managing expenses.
What many people might not realize is there are some small steps they can take to reduce monthly expenses and free up money to save. Here's how:
1. Brown bag it.
Buying lunch and coffee every day at work can add up, costing as much as $10 - $15 a day. Save money by brewing your morning coffee and making your lunch. That could free up hundreds of dollars a month to save towards retirement, college savings or an emergency fund.
2. Put away your credit cards.
Some experts literally suggest you put your credit cards in a can of water and place them in the freezer, making them less accessible. We don’t recommend going to this extreme since you may need your credit card for an unexpected or emergency purchase. Instead, just take them out of your wallet. You’ll think twice about that impulse buy if you need to get your credit card. Also, if you have high-interest credit card debt, focus on paying it off or transferring it to a card with a lower interest rate.
3. Sign up for rewards programs.
To encourage repeat business, most retailers offer rewards programs. Even though signing up can take a little longer at the register, it's worth it. You can earn valuable discounts including special discounts, cash back, savings at the gas pump or other money-saving benefits.
4. Look at your bank fees.
Are you paying high monthly fees on your checking account? Ask your banker to review your needs to ensure you’re in the right account for your checking activity. Also, save money on ATM fees by using ATMs in your bank’s network, or using a checking account that reimburses the fees other banks charge for using their ATM.
5. Plan your meals.
To avoid the temptation to go out to eat or order in, plan your meals for the week. Even pre-cook and freeze some in advance, so if you get home late or are too tired to cook, you can easily reheat a good meal.
6. Shop for grocery deals.
Planning ahead will also help you save money at the grocery store. Take a look at sales flyers to find the best deals on the foods you need.
7. Reduce gas expense
Gas can be a big monthly expense. One way to conserve it is to run all your errands on one day, instead of making several trips a week. Also, if you have co-workers that live nearby, ask them to carpool. By taking turns driving, you’ll both save over time.
8. Use your library card.
Reading is a great hobby, but if you purchase your books online or at the bookstore, it can be expensive. One easy way to avoid book expenses is to use your library card. This doesn’t mean canceling movie night. Many libraries also have DVDs available to borrow.
9. Avoid shopping when you're upset.
Many people spend on their emotions. If you're feeling down, the worst thing you can do is visit a store or shop online.
10. Cut cable and other TV packages.
It's great to have a variety of things to watch on TV, but do you really need cable, Netflix, Hulu, and other subscription services? Choose one provider and save.
If you want to start saving or save more, start by picking a few of the suggestions above and track how much you save over the first few months. You can visualize your savings by using our helpful savings calculator. You’ll be well on your way to building a successful saving habit!