To say that keeping up with living expenses is hard could be the understatement of the year. It is a hardship shared by people of all walks of life, no matter what your salary grade or lifestyle. Perhaps the biggest obstacle in this day-to-day struggle is spending less without being miserable.
In this article, we’ll discuss ways on how to cut down on your daily, then your monthly expenses. Keep in mind that there’s no one all and be all solution. The solution is a process. Even though some of these expenses may be small they might be a huge drain on your funds once summed up.
The biggest tip I can give you right out of the gate: STICK. TO. YOUR. BUDGET.
You should always remember this if you’d like to save more money. This might mean sacrificing a few things to make ends meet, but that’s all part of the process.
Cutting expenses doesn’t always have to be in the form of grand gestures. Few tweaks with your lifestyle can save you hundreds, or even thousands of pesos. Here’s how:
1. Track your Spending
The first step in understanding how you manage your finances is to track your cash outflow. In other words, know where your money is going.
This goes without saying, but make sure you spend less than your income. Otherwise, it’s time for a harsh reality check.
If you keep wondering where your money went and crawling to the next payday, then at least tracking will help you know where the bleeding is. The first–and probably hardest–step in rehabilitation is acceptance. Once you bite the pill and lay out your expenses, it’s time to cut it–without mercy.
There are a bunch of tools available online that can help you be on top of your expenses like ClarityMoney or Mint and they’re for free!
Tracking can be as simple as developing the habit of writing down everything you spend on, no matter how small. Before you go to bed, sum it all up! After every week, sort your expenses in order of importance, so you’ll know which ones you can eliminate first. For example, food prep and transpo can be at the bottom of your list as essentials, while luxuries like shopping and subscriptions can go at the top.
2. Remove the Clutter
Creating an environment of saving is also important and it pays to start where your day begins and ends.
Examine your room. Found an item you’ve not used for a few months? Great! As Marie Kondo always says, “Human beings can only truly cherish a limited number of things at one time.” So remove the clutter and make space for more important stuff.
Decluttering your room sets a healthy mindset of prioritizing needs over wants. In other words, buying less stuff means you have to clean less as well. You can either sell the items you’re discarding or donate them. This way, you’re not only making more space but you also get to earn extra cash (or make someone else happy if you choose to donate them).
3. Shop Smart(er)
I don’t want you to go insane. Shopping is important for supplies and for keeping ourselves sane after rough days at work. When going out for shopping, never, ever leave the house without a list. The general rule here is that, you’re not allowed to buy anything unless it’s on your list.
Include luxuries in your list–whether it’s that phone or bag you’re saving up for. This will be your motivation in saving more. Again, categorize according to importance. This time, your luxuries should go at the bottom of your list and your essentials should go at the top.
Making a list also lets you plan ahead–knowing what you really need to. It’s also a good idea to set a date for grocery, so you can avoid running out of supplies, which may result to convenience store runs.
4. Say NO, but not all the time
Practice the subtle, yet important art of saying no.
Lunch out with co-workers? Night out with friends? We can sometimes be pressured to say yes even if we don’t want to.
The next time your co-workers or friends ask you to eat out, try to be open to them about your goals. You don’t have to directly say “I can’t afford to spend extra right now.”
You can always keep it gentle and positive! Simply say, “I’m trying to save money by eating at home (or bringing my packed lunch).” Who knows? You may not only be helping yourself achieve your goal, but you may also inspire them to do the same.
BUT, and this is a big but, don’t starve yourself. Have a cheat day every couple of weeks to de-stress. Cutting expenses is–in a lot of ways–similar to losing weight. An occasional break from the grind is good to remind ourselves of the good things in life. But just as before, remember to stick to your budget!
5. Re-evaluate your monthly Subscriptions and Memberships
Today’s subscription-crazed world has made it all too likely that you’re paying for services that you don’t necessarily need and those that you barely use. Here are specific subscriptions you might want to take a second look and eliminate from your monthly expenses:
Gym Memberships. If you are one of those people that goes to the gym thrice a month or less, cancel that gym membership now because you’re only wasting money. Having a gym membership is a want and not a need, and you can definitely get fit without it. There are a lot of ways to exercise for free. Why not try a home workout instead?
Downgrade Plans You’re Not Maximizing. Have you checked if you’re able to fully utilize your monthly phone plan? How about your internet plan? If you’re only consuming half of what your plans, it’s a waste! It’s time to cut them out.
Online App Subscriptions. You may be paying Spotify to stream music, Netflix, Amazon Prime or Hulu–or all three–to stream your movies and other apps you rely on. Fees for these apps may appear small but these can have a way of gobbling up your monthly budget. You can opt to cancel some of your subscriptions or share the cost with a friend or family to save.
If you’re looking for a way to protect your savings, you may want to consider opening a time deposit account. Compared to other types of investments, a Time Deposit is easy to set up and is not risky so you don’t have to worry about losing money.
Big cuts in your budget aren’t the easiest to handle. But keep in mind that you don’t have to do every single item on this list all the time. Give yourself allowances when the occasion calls for it, and indulge yourself every once in awhile.
This article was originally published in the Blog section of Security Bank online.