49% of Americans live paycheck to paycheck, and more than half don’t have emergency funds to cover up to 3 months of expenses.
If you find yourself wondering why you don’t have anything left over at the end of each pay period, it might be time to look at new ways to manage your monthly expenses and start saving.
Believe it or not, 33% of Americans don’t even follow a budget. For those who don’t manage their monthly expenses, it’s almost impossible to save.
Keep reading to learn tips on how to manage your bills and save money while you do it.
How To Control Expenses And Save Money
Easier said than done, right? Well, not necessarily. Whether it’s $5 a week or $300 a month, every income has a bit of room for savings.
It’s not about how much you make or how huge your paycheck is, it’s about what you do with it and whether or not you save at all.
Let’s take a look at some tips for saving.
Find Ways You Can Cut Your Spending
When it comes to streaming services, the average American uses 3.4. Figure out which one is most important to you and cut back on all the others. Getting rid of 3 could save you almost $30 per month.
Do you have any makeup, clothing, food, or other subscriptions you could take a break from? If you want to start saving, it might be a good time to start.
Stop Eating Out
45% of the cash Americans spend on food is spent on restaurant dining and take out. If you think you’re $10 burgers and $5 coffees don’t add up, think again. They do.
We’re not saying to never eat out again, but we are saying to limit yourself. Give yourself a monthly budget for dining out or ordering delivery, and don’t go over it.
The same thing goes for coffee and muffins to go. If you’re used to buying your coffee every day, cut back to twice per week, and then take it out completely. Or, treat yourself one day a week.
The key is that whatever you decide is your limit, stick to it, and take pride in your ability to make and follow a plan.
Lower Insurance Rates
Is there a way to reduce your car insurance bill every month?
Part of money management is holding yourself and those you pay bills to, accountable. Call each person or company you owe an expense to every month and look for reductions where you can. Lowering your auto insurance, for example, could result in significant savings.
Start using grocery coupons and looking for deals. If you must have that $18 bottle of wine every week, check and see if anywhere else sells it for less. That $5 difference can go directly into your savings.
Find a Way to Cut Back on Big Expenses
Don’t forget to check the big expenses too. Are you paying too much for your mortgage?
Find out if refinancing could save you some money.
Put Everything Down on Paper
Once you’ve cut back on monthly subscriptions and lowered your bills by calling all your service providers, it’s time to get everything down on paper.
First, make a monthly expenses list that details every penny you’ll spend in a month, including groceries, gas, gym membership, takeout, and all other expenses.
What’s your monthly income? Write that down too to determine how much you have leftover because that’s what you should be able to save.
Is it more than you thought? You’re on the right track!
Were you hoping for more? Look for additional ways to cut back.
Make a Monthly Budget and Stick to It
Once you’ve documented your expenses and taken a look at how they compare to your income, it’s time to establish your monthly budget.
Whether you put it on paper, in the notes section of your phone, use an app, or make an excel document, the key to money management is making this budget your best friend. Write down the days you get paid over the next 6 months, and figure out what expenses come out of which paychecks.
You should know exactly what bills come out and when so that you’re never surprised or end up with excessive overdraft fees.
How to Stick to a Budget
The difficult part isn’t making a savings plan; it’s knowing how to stick to a budget. Luckily, there are plenty of ways to hold yourself accountable.
Get Rid of Overdraft Leniency
Does your bank allow you to overdraft by $500 or $1,000? If so, get rid of that feature if you don’t withdraw that much money.
If the allowance is there, the chances are higher that you’ll give in to temptation in a moment of weakness.
Set up All Your Bills as Automatic Payments
When bills come out automatically, people are much less likely to flake or put the bill off to pay at a later date. Plus, when it’s an auto-draft, you know exactly what day it comes out of your account and can plan your monthly budget accordingly.
Many phone and utility companies offer a discount for those who sign up for automatic debit, too. So there’s another way to save!
The days of using cash are antiquated for many of us, but using cash helps you be more scrupulous with your purchases. For example, say you used to spend over $1,000 on groceries every month, but you’ve decided you can make it with $800 a month.
If you’re making a trip to the grocery store and your budget for that week is $200, bring cash! You won’t be tempted to impulse buy, and you can’t make an overdraft because you’re paying in cash.
Give yourself a reward for making it through your first month, or even week, on a budget. Save your weekly takeout coffee for a morning that you’ve got a big meeting or a longer shift.
When we borrow money, use credit cards, or spend night after night eating out, we are essentially borrowing from our future selves. After all, when you spend money on an extravagant dinner, you’re the one who has to pay it back. But if you save up for it, it’s much more gratifying.
Budgeting and saving are you looking out for your future self.
Pay Down Your Debt
If you don’t have any debt and it’s savings you need to build, congratulations! You’re already ahead of most Americans.
Debt can feel like a great burden, and the only way to alleviate that burden is to take control and pay it down.
Lower Your Interest Rates
Do you have multiple credit cards with high-interest rates? Give those companies a call and see what you can do to get them lowered. Many credit card companies will help you consolidate your debt onto one card and give you a lower interest rate for a certain period.
Pay off smaller debts first if you can and then work towards those larger ones. If you’re overwhelmed by credit card debt, this article will provide tips on how to get out of it.
Sell What You Can
When someone starts saving, it’s all they want to do. It can be daunting when a huge chunk of what you have leftover goes to paying off credit cards or other debt.
Take a look around your abode and if there’s anything you don’t use or need, sell it. Take all the money you earn and put it directly into your savings or pay off a credit card.
Take Control of Your Monthly Expenses so You Can Start Saving
The best savers in life have complete control over their money. If you want to start saving for your future, the first thing you have to do is take control of your monthly expenses by making a budget and sticking to it.
Once you start, you’ll feel more at peace, knowing that you are in control. When you find ways to save and invest in your future by doing so, you’ll be able to watch your savings grow!
Are you looking for even more financial help? Visit our Financial Resource Center for more resources to get you through the unexpected.