“Spend less than you earn.”
It seems like a simple concept. But the application is much harder. Often, getting a good grasp of what you earn and what you can feel like rolling a boulder uphill.
Much like I did.
I would often write down my financial goals, promising myself that I would save X amount of money by Y time–but that X never happened because I never took myself seriously.
So after going through my 2020 financial statements, I realized that something had to be shaken loose. I had to limit my careless spending and stop buying products or services that I didn’t need; yet I didn’t know-how.
But after trying out new solutions throughout the year, I’ve finally narrowed down some that helped me save thousands of dollars over 2021–many of which were out of the box.
So, sit down, grab a cup of home-brewed coffee or tea (if that floats your boat, and get ready to learn some creative money-saving strategies you’ve probably never heard of before.
7 Creative Ways to Save Thousands This Year
- Pay the 10% “Invest in Me” Tax.
According to the Bureau of Labor Statistics, an average American spends $61,334 on annual expenditures, such as food (at home and takeout), housing, transportation, healthcare, entertainment, personal care products, education, personal insurance, and more.
If you take this number into perspective, you know that you spend hundreds of dollars on various things that you think you need in life. But what about yourself? Have you saved something for a rainy day?
Would you be able to cover an unexpected $1,000 expense if it pops up?
Many Americans can’t. In fact, according to Bankrate, only 39% of Americans can even afford an unexpected $1,000 expense.
This is why I’m asking you to invest 10% of your income every year into another account. Think of it as a tax on yourself—a tax that would help you navigate unexpected events with ease. Speaking of taxes, if you’re lucky enough to get a tax refund, then you can use that as a potentially substantial boost to your “invest in me” account. Better yet, you can file your tax return for free in most cases.
- Try the $2, $5, or $10 Trick
One of my friends introduced this trick to me. She told me that whenever she got a $2, $5, or $10 bill, she would deposit it into a box and forget about it. A year later, she would open the box and claim her prize.
The first year she did the “spare change trick,” she saved around $1,400, which was crazy to me.
So when I decided to overhaul my financial habits, I took her advice, bought a box, and started putting spare change into it—pennies and $2, $5, and $10 bills. For me, this was a great strategy because I usually ended up spending all the spare change I had on one thing or another. I ended up saving more than $1000 in 2021.
So, why don’t you give this a try and find out how much you can save? After all, it’s the beginning of the new year!
- Get a Helpful Hobby
Learning how to mend torn seams, cut and resew many too-long jeans, paint the walls, make your cleaning supplies, and grow your herbs can drastically decrease your annual expenditure.
For example, if you mend all your clothes when they get torn, they’ll last longer, and you won’t have to spend hundreds of dollars every year on buying new clothes. Similarly, painting your walls can help you save upwards of $500 – $1,000.
So, rather than hiring an expert (who will break your wallet) for simple jobs, try to do the simple jobs yourself.
- No Spend Challenge
This challenge is simple. All you have to do is promise yourself not to buy anything except essential items (grocery and personal care items) at least two days of the week. For example, you could try not to spend any money on a cute dress/sweats set, an amazing deal, or a new iPad on Thursday or Friday.
I tried this approach, and I can tell you that it’s effective. At the end of the month, I ended up with an extra $500. However, this challenge takes a lot of willpower, so that is something to think about.
- Brew Your Coffee
Every day, before going to the office, many spend around $4 on our favorite coffee. But if we take in the numbers, we can see that our regular coffee consumption amounts to about $104 per month, which is $1,200 per year.
And this is a modest estimate, as according to Perfect Brew, Americans on average spend around $2,130 on coffee per year, which amounts to $177 per month. This is a huge amount of money to spend on just coffee.
So, if you are a coffeeholic, why not just get a coffee maker, some good beans, a travel mug, and take your coffee with you on the go? Not only will it be cheaper, but it will also save you the time you spend standing in lines.
- Sell Anything You Don’t Use
Most of the time, our homes are filled with clutter. The jeans at the back of your closet, the old boots you love but can’t wear anymore, the wallpaper you bought but never used, the Lululemon leggings too tight to fit you … All of these things are hiding in your house, taking up space.
They are a good opportunity to make some bucks.
For example, you could sell the Lululemon leggings, jeans, and boots on Facebook Marketplace or eBay for a neat profit. And the better the condition of your stuff, the higher it’s going to sell—at least that was my experience when I sold my barely used KitchenAid stand mixer.
Remember to use an invoice generator to total your costs and enter them into your budget.
- Shop for Groceries on Online Sites
This is one of the best ways to save money; trust me, I would know. I usually spent over $150 on groceries for my partner and me every week, and I couldn’t figure out why I was spending so much.
When I finally decided to see the error of my ways, I used remote tools like Mint and NNAB and figured out that I was buying too much for one week. I regularly bought bundles of lettuce, tomatoes, and cheese when I already had them in the house.
So, when I started buying all my groceries from an online retailer during COVID, I realized how much I could save by only buying what I needed. I cut my yearly grocery expenditure by a third during 2021, saving hundreds of dollars that I could use elsewhere.
The Bottom Line
Saving money is hard, but you know what? You can give it a good try by using these strategies; maybe you’ll end up saving more than $2,000 per year by making these little changes–after all, it is often the little changes that add up to create major ones.
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