Hello, Budgetesses! Today we’re diving into an essential topic—top tips for cutting expenses. We all want to save more money, and I’m here to help you do just that. Budgeting doesn’t have to be daunting; with the right tips, you can turn it into a powerful tool for achieving your financial dreams. So, grab your favourite notebook, and let’s get started!
1. Track and Review Your Spending
The first step to cutting expenses is understanding where your money goes. This means tracking and reviewing your spending. For a month, write down every single expense. Whether it’s a cup of coffee, a grocery run, or an online purchase, note it all down. Use budgeting apps like Mint or a simple notebook—whatever works best for you.
Knowing where your money goes is the first step to making informed decisions about where you can cut back. If I don’t have a plan for my money, it ends up going towards dozens of small purchases that I wouldn’t normally make. Checking in on your budget helps you stay on track.
Reviewing your expenses weekly is one of the top tips for cutting expenses as it helps you stay on top of your spending and make adjustments as needed. You might be surprised to find small, unnecessary expenses that add up over time.
2. Cook at Home
Eating out frequently can drain your wallet fast. Cooking at home is not only healthier but also significantly cheaper. Plan your meals for the week and start with simple recipes to ease into the habit.
According to the Consumer Price Index, in the US, food at home increased by 1.1% over the last 12 months, while food away from home increased by 4.1%. In Canada, food at home increased by 1.4%, and food purchased from restaurants increased by 4.3% over the same period (Statistics Canada). These statistics highlight the growing cost difference between eating out and cooking at home.
With the way prices are now, one dinner out with my fiancé costs nearly as much as half our groceries for the entire week. By cooking at home, we not only save money but also enjoy healthier meals together.
Start slow by increasing by just one additional meal at home and don’t try to cook everything. Grab meals that are easy to cook as well. Don’t be afraid of frozen meals and prepped ingredients if it means that you’ll eat at home instead of from a restaurant. Set yourself up for success.
3. Cancel Unused Subscriptions
Take a close look at your bank statements and identify any subscriptions you’re not using. Whether it’s a gym membership you haven’t used in months or a streaming service you forgot about, cancelling these can save you a lot each month.
A study by C+R Research in 2022 showed that consumers spent $219 a month on subscriptions. Which is 2.5x more than the consumer’s estimate of $86 a month. 42% had forgotten about a subscription that they no longer use. This is why it’s crucial to review your subscriptions to ensure you still need them regularly. Companies often rely on consumers forgetting about these subscriptions, so don’t let unused services fall through the cracks and drain your finances unnoticed. Among the tip tips for cutting expenses, cancelling unused subscriptions is a simple yet effective way to save.
Set a reminder every few months to review your subscriptions. This helps you stay aware of what you’re paying for and ensures you’re only spending on what you truly use and value. Check for any subscription bundles to help reduce costs. But remember only get the bundle if you are going to use the entire bundle. Unless it is cheaper to get the bundle than to get the parts you are going to use separately.
4. Shop Sales, Use Coupons, and Buy Generic Brands
One of the easiest ways to save money on essentials is to shop during sales, use coupons, and buy generic brands. Look for sales on items you regularly purchase and use apps like Honey or websites like RetailMeNot to find the best deals. There are also influencers that put out weekly lists of the best deals in your area, this can reduce the workload of trying to match coupons and sales.
Consumer Reports has shown that many store-brand items are just as high quality as national brands but cost significantly less. Making the switch to generic brands can lead to substantial savings.
Before going shopping, make a list of items you need and check online for any available coupons or discounts. Don’t forget to check if your favourite store price matches with other local stores to prevent needing to go to multiple stores. This way, you’re prepared and can make the most of your shopping trips.
Remember: Don’t buy what you won’t use. That doesn’t save you any money.
5. Use Public Transportation
If you live in an area with reliable public transportation, take advantage of it. Using the bus, train, or even biking instead of driving can save you a significant amount of money on gas, parking, and car maintenance.
According to the American Public Transportation Association and the Canada Public Health Association, public transportation saves individuals approximately $10,000 annually by reducing costs associated with driving. Plus, it’s better for the environment and for you! Utilizing public transportation is one of the top tips for cutting expenses that can have a substantial impact on your budget.
If public transportation isn’t feasible every day, consider using it a few times a week or for specific trips where it makes the most sense. Or look for someone to carpool with. Every little bit helps.
When I lived in Toronto, I used to take public transit to work every day, I only used my car to go get groceries, which I would carpool with a friend. One of the few expenses that increased when I moved away from Toronto was my gas, I went from filling up the car once every 3 months to every 2 weeks.
6. Use Cashback and Rewards Programs
Many credit cards and shopping apps offer cashback on purchases. Programs like Rakuten or your credit card’s rewards program can help you earn money back on things you already buy. Just be sure to pay off your balance each month to avoid interest charges.
According to Fobes, the average family can earn $433 a year with a simple 1.5% cashback card. This is essentially free money you can earn by spending as you normally would.
Make a habit of checking if the stores you frequently shop at are part of any cashback or rewards programs. Signing up and using these programs can lead to significant savings over time.
I mostly use cashback cards since it’s easier but I do have a few rewards credit cards for groceries. I love being able to use the points and walk out of the store with over $100 in groceries and only paying a dollar or two.
7. Limit Online Shopping
Online shopping can be incredibly convenient but also dangerously easy to overspend. To avoid impulse buys, make a rule to wait 24 hours before making a purchase. This helps you evaluate whether you really need the item. By implementing a waiting period, you can significantly reduce unnecessary spending and avoid buyer’s remorse.
This Time article has a bunch of great ideas on how to make it harder to shop online and give you more time to think about your purchases. Things like deleting or not saving your credit card can be enough of a pain to help reduce your shopping. Limiting online shopping is one of the top tips for cutting expenses by curbing impulsive purchases.
To make it less convenient for you, some people I know have suggested cancelling your Amazon Prime and making yourself wait until there are enough items in your cart to get the free shipping. But I know if I’m close to free shipping I would probably look for something to buy so you need to know that you can hold yourself to that rule and not buy items just to get the free shipping.
8. Find Free Entertainment
Entertainment doesn’t have to be expensive. Instead of going to the movies or a concert, look for free activities in your area. Parks, libraries, and community events can be a lot of fun and save you money.
The best place that I have found out about free events in my area is various Facebook groups. Look for local groups to join and talk to people about what you are looking for. I found a free yoga class in the park that run in the summers through Facebook and a Summer Concert series on my city website. My sister found a free 5K running group through one of the kids that she coaches.
Set aside some time each week to explore free events and activities in your area. You might discover new hobbies and meet interesting people without spending a dime.
Set aside some time each week to explore free events and activities in your area. You might discover new hobbies and meet interesting people without spending a dime.
9. Borrow or Rent Instead of Buying
For items you only need temporarily, consider borrowing from a friend or renting from a local store. This can save you a lot of money and reduce clutter in your home.
You can also check your library, mine has a Library of Things with cake pans and the like. This can save you a lot of money and reduce clutter in your home.
Renting a power tool for a day can cost as little as $20, compared to purchasing it for several hundred dollars. This principle can be applied to many other items you might need for a short period.
Before purchasing a new item, ask yourself if you can borrow it or rent it instead. This not only saves money but also helps you make more sustainable choices. If you need to purchase an item ask around and see if anyone wants to purchase it with you. My sister and I share batteries for her snowblower and my lawn mower. They have the same battery and then we both didn’t need to buy additional ones.
10. Embrace Minimalism
Minimalism isn’t just about owning fewer things; it’s about making intentional choices that bring value to your life. Declutter your home and sell items you no longer need. This not only brings in extra cash but also makes you think twice about new purchases.
By focusing on what truly matters, you can simplify your life and reduce unnecessary expenses. Some other communities to check out are Simple Living and Frugal. Most of these communities focus on saving money so that you can spend money where it really matters to you.
Embracing minimalism was a game-changer for me. By selling items I no longer used, I not only made extra money but also created a more peaceful living space. It made me more mindful about future purchases and helped me focus on experiences over things.
Conclusion
And there you have it! Those are my top tips for cutting expenses. Remember, every little change can make a big difference. By tracking your spending, cooking at home, cancelling unused subscriptions, and adopting other smart strategies, you can save money and achieve your financial goals.
Thanks for reading! If you found these tips helpful, please share this post with others who might benefit. Drop any questions or your own tips in the comments below. Let’s keep saving together!