If you are new to saving money and cutting expenses, you may search the internet where you will find such tips as “Skip your daily coffee fix” and “Buy store brand foods instead of name brand foods.” While this advice is good, it only offers a superficial way to cut expenses. You may need to look beyond this generic advice to find other ways to trim costs. My family is in this situation currently; our income does not add up to the equivalent of our expenses. Not only are we making less than we spend, we are not able to add to our savings. This situation is temporary, until my husband finishes his post-doc, but obviously it is not sustainable for the two years he will be in a post-doc position. Here are some of the extra ways we have found to trim our budget:
-Stop writing checks. We have automated our bill paying online. At first I was resistant to do this, but when I added up how much I was spending on checks ($38.12 for a year’s worth) and stamps ($52.80 a year) for a total of $90.92, I decided to do it. I can’t eliminate all check usage, but automating our bills has reduced our check usage by 3/4s, which will save because I won’t have to buy checks as frequently.
-Cancel automatic payments for services you no longer use. One downside of automating payments online is that you may stop using a service and yet forget to stop the auto payment. I recently closed an eBay store that I had. As part of my eBay business, I had automated payments to a template service (that basically made my auctions look prettier by putting a design in the background) at $12 a month and to a selling newsletter for $8 a month. I was annoyed when, a month after I closed the eBay store, I discovered I was still billed the $20. I forgot to cancel the subscriptions.
You may find that some companies make it difficult to cancel online subscriptions. (Remember the old Friends episode where Chandler wants to cancel his gym membership, and every time he tries he is instead convinced to stay?) While it may be very easy to sign up for recurrent payments on your credit card, when cancelling you may need to call the company and listen to them try to upsell you. Persist because it is not worth paying monthly for a service you are no longer using.
-Change to online bank statements. My bank recently began charging $3.00 per month for paper statements. That adds up to $36 per year per account. Because I have 3 accounts with them, it adds up to $108 a year wasted. Yes, I prefer to have physical copies of my statement, but not at a cost of $108 a year.
-Consider changing banks if the fees get too high. Last January, my bank started charging me $9.99 per month for my eBay business checking account. That is $119.88 a year just for the joy of banking with them. I have since cancelled the account. I am now in the market for a new business account for my writing and blogging service, and you can bet I won’t be going with my current bank, and I’ll be looking at well reviewed banks that maybe have good new account promos.
There are plenty of ways to save money if you look carefully. These are just a few ways you can save at your bank and online, but they clearly add up. Making these small changes has saved my family $230 a year!
What other ways do you use to save money?
photo credit: Patrick Hoesly
Melissa is a writer and virtual assistant. She earned her Master’s from Southern Illinois University, and her Bachelor’s in English from the University of Michigan. When she’s not working, you can find her homeschooling her kids, reading a good book, or cooking. She resides in New York, where she loves the natural beauty of the area.
Some great tips. We use a bank that has no service charges at all (president’s choice finanacial in Canada.) Sometimes it’s a bit inconvenient because they only have kiosks, not an actual bank in which you can talk to a teller, etc…but we save so much with not having to pay for cheques or other bank fees.
One of the biggest money-saving methods we used was to make a menu plan for our meals, and to use what we had in the pantry for as long as we could.
Some Excellent suggestions. I am doing all the tips mentioned in this article.
Many banks offer a free checking account if you have direct deposit. In addition, one of the best things to do is talk to your bank(er). Tell them you want to reduce your expenses and ask for their help. They want to keep you as a customer and will discuss your options.
Your suggestions are good, and all things I’d promote.
For me, I wasn’t getting enough out of the little things. Instead I began cutting out the non-essentials altogether. We didn’t get the cheaper cable package, we got rid of cable. We didn’t cut out our driving or get a cheaper car, we got rid of our second car. We didn’t turn down the temperature to save a few bucks on the AC bill, we downsized our house (creating both capital and increasing cash flow).
We bank with a credit union and earn interest on both our savings and checking accounts.
We also have a second, high yield savings account that it takes a few days to transfer money from. That means that if we want to spend more than what is immidiately available, we actually have to plan for it. It cuts down on a lot of impulse buys.
The other major way we cut our expenses was to make it quicker and easier to eat at home than going out. When we do cook, we always make enough for at least one more night’s worth of dinner. We stay stocked up on rice (and have a rice cooker) and pasta and other staples so that we can quickly throw a dinner together that we both like in little time with almost no hassle.
In addition to the frugality of online payments, I just like the easiness of it. I never have to worry about missing a deadline, which is worth it all by itself (especially because I live rurally and mail takes longer both ways).
I would say cutting cable and even internet if it is not completely necessary. If you can go to your local library and check your mail/pay bills–then go for it. If you are truly trying to cut down and pay debt I would do anything possible to eliminate the non-essentials. Oh, another is downsizing your cell phone plan. My girlfriend doesn’t have text and never has and she survives–she also doesn’t have internet on her phone. All you need is the basics. I am sure this is blasphemy to many eyes…;)
Interesting, isn’t it, how saving on mailing costs can save you money? Some people pay rather high fees too for writing checks.
I love my banks online billpay but only use it for things I can’t pay for with plastic. I’m very big into rewards programs (put everything on my credit card and pay it off monthly). I consider the cash back from the rewards as savings (1-2% on each purchase).
I love recurring payments, especially because they are free and save time. I also use e-statements and e-reminders to save paper and help me keep track. -Sydney
I had a couple of instances where I forgot to cancel my online auto pay after cancelling a service. Boy, was that maddening! The tips you digest are great. Specially, the free checking accounts. Whether its a personal account or my business account for MOMables, I refuse to pay banking fees. They make enough with holding my money!
It kills me that the banks are nickel and dime-ing us to death. Ours started charging for statements as well. I keep records so I am going to now have to print the dang things at my expense! It didn’t do us any good to talk to our banker – she just couldn’t do anything about the policy and we have been banking there for over 30 years. aaaarrrrgh.
Anyway, I second Brave New Life’s approach. If you are spending more than you make, get drastic.
Another way I saved an extra 20 bucks a month is by raising my insurance deduction. It makes me remember to driver safer and I can put away the extra money it would cost IF I had an accident from the savings each month. And if I don’t have an accident, I get to keep that money. Double incentive!
I think the best thing any one can do is be aware! So many of us don’t realize what our banks and credit card companies are charging for services. I look at everything from my power bill to my debit card. I was amazed to find out that I get charged an extra $30 a month just for the security light on my property.
We went paperless with our statements a couple of years ago and also pay nearly every bill online – saves time and money!