I was so surprised when I learned that in 2017, US households had an average yearly spending of $60,060. What surprised me, even more, was when I read about the average American owing $38,000 in various types of debts!
That alone can – and should – make anyone rethink their spending habits. I did, and from there, was able to control my monthly spending.
That’s why today, I wanted to share some of the ways on how to save money on monthly expenses. Cutting back on these expenditures is key to saving money today and in the long run.
Ready to take better control of your monthly costs and finances? Then let’s get right into it!
1. Make a List of Your Monthly Expenses
Get a pen and paper, and then make a monthly expenses list. Include everything that you spend money on a monthly basis. Examples are utilities, groceries, monthly subscriptions, mortgage loans, and gas or transport allowance.
By knowing exactly where your money goes every month, you’ll have a better idea on which parts you can cut back on.
2. Separate Fixed from Variable Expenses
Next, determine which are the fixed and variable expenses on your list.
Fixed expenses are those which amounts don’t change. A fixed-rate mortgage loan or house rental payments are good examples. Insurance premiums and fixed-rate utilities (like your phone) are also fixed expenses.
Whereas variable expenses keep changing every month. They are also either necessities or your “discretionary spending”.
Necessities include groceries, gas for your car, and utility bills. For discretionary spending, this includes shopping for clothes, eating out, and entertainment.
3. Trim Down Not-So-Necessary Expenses
Step number two allows you to create a more effective monthly budget planner. By knowing your variable expenses, it’ll be easier to make necessary adjustments.
In fact, you may end up surprised to realize how much you’re shelling out for these non-necessities!
To put things in perspective, the average female owns over 100 pieces of clothing items. A study also predicted that come 2021, an average US adult will own 13 connected devices. Summing up, the average US household contains around 300,000 items.
Although clothing is a necessity, we wouldn’t need more than 100 of them all at the same time. PCs, laptops, and smartphones may be crucial for work and communication, but 13 is a little too much, don’t you think?
These are the areas of your spending you’d want to start reducing.
4. Cut Back on Your Electricity Use
Back in 2017, US households had an average monthly electricity bill of $111.67. If you live in Hawaii, Alabama, or South Carolina, you may have even paid around $140 or more!
A good way to bring your electricity bills down is to switch to LED lights. They use up to 75% less energy than incandescent lights, while lasting 25 times longer.
Also, make it a habit to unplug all unused electronics, even those that go on standby mode. These are vampire energy devices since they “suck” electricity even when not in actual use.
5. Start Using Discount Coupons
Trim your shopping expenses like the 96% of American consumers who use coupons. A 5% discount may seem small, but if you sum up all the savings you can get, they’re quite considerable.
6. Consider Carpooling to Work
If possible, carpool to work (or anywhere else you usually go to) as much as you can. This can help you save on gas while also reducing wear and tear on your vehicle.
7. Use Public Transportation When You Can
Along with carpooling, use public transportation whenever possible. You may also want to start biking to and from work. Not only is this cheaper – it’s also healthy, letting you burn up to 346 calories in 30 minutes!
8. Eat at Home More
For most of us, dining out has become the norm because it’s quicker and more convenient. But these perks come with a hefty price: we spend more than $3,000 every year to eat out.
If you prepare your own food at home and take lunch with you to work, you can put away a lot of that cash. Plus, you get to skip long lunch queues while also eating better.
9. Skip the Pricey Coffee
We love coffee, so much so that we shell out an average of $1,110 for it every year. But you can avoid this exorbitant expense by making your own coffee and bringing some to work.
Put it in a nice, reusable tumbler or flask to keep it hot for hours.
10. Start Your Very Own Fruits and Veggie Garden
Grow your own fruits and veggies to substitute the expensive organic food you buy. Beans, beets, carrots, salad greens, and herbs like cilantro and chives are the easiest to grow. If you’ve got a lot of space, go for pumpkins, tomatoes, and radishes too.
11. Uninstall Shopping Apps from Your Mobile Devices
It can be hard to curb shopping cravings if you always see apps for them on your smartphone. If you’re serious about trimming your monthly shopping, uninstall these programs.
That way, if you feel tempted, you’d have to go through downloading them again. That download wait time may be enough for you to forget about your craving in the first place.
12. Review Your Loans and Insurance Premiums
Before you take out any loan or insurance product, compare as many offers as you can first. You may think that a $5 difference every month is small.
But remember, although these are monthly expenses, they’re still long-term.
Start Using These Tips on How to Save Money on Monthly Expenses Now
With these tips on how to save money on monthly expenses, you can start building your savings account. Especially if you’re part of the 29% of households with less than $1,000 saved up.
Also, by trimming your monthly expenditures, you have more to put away for emergencies.
Want more tips to bring your personal expenses down? Here’s another cost-cutting guide that you should check out.