With living costs at an all time high, saving extra cash each month is hard for any individual in the United States. Luckily, we have a few tips and helpful resources to guide you on your journey towards financial freedom. These tips will help you save extra money each month by reducing expenses, increasing your monthly income and train you to continue saving more money beyond your initial goal.
What motivates you to save extra money each money? Do you want to save up for a new car? Go on vacation? Buy a house of your very own?
Everybody has their own reasons why they want to save extra cash each month, but rarely do people have a plan in place. We do. We have a plan on how to save extra money every month and we explain it step by step for you.
1. Start small to grow big
No matter how motivated you are about money, saving money can be a difficult task and a struggle for most people. Instead of overthinking your savings goals into a mountain of hurdles, take a different approach. Rather than imagining one giant hurdle towards your savings goal, look at slowly increasing your savings in small increments consistently.
This will not seem like an effective plan, but slowly over time you will see your savings grow into a much larger pool and your goals will seem more attainable.
2. Establish your savings accounts and goals
It doesn’t get much easier than this one. This is as simple as opening a new savings account with your local bank or online bank. Use your banking online website or mobile app to re-name your savings accounts to give the account more meaning behind your savings goals.
Each deposit you make, you will see where you are putting your hard earned money which will be rewarding when you achieve your financial milestones. Labeling your savings accounts separated by goals in mind or tangible items will motivate you and keep you focused on stashing away extra money as often as possible.
3. Create a reasonable budget
When you are trying to save extra cash every month, the easiest way to do this is by reducing your expenses. Creating better money saving habits by avoiding expenditures on unnecessary items and understanding the difference between wants and needs will enable you to save more money for years to come.
Between living costs, food, gas and basic additions like internet and phone, monthly expenses for the average American add up quickly. It is important to carefully evaluate your expenses sooner rather than later so you can maintain a surplus to put aside for savings.
Basic monthly budgeting example:
- Living costs, rent or mortgage payment $1000
- Food and groceries $500
- Car payments $250
- Gas $50
- Heat, water, and electricity $100
- Internet $60
- Television $45
4. Negotiate your monthly bills
This might surprise most people, but if you put in the time you are able to negotiate your monthly bills with some of your local service providers. Not all service providers will allow you to do this.
Some cable companies, phone service providers, local bank loans, auto insurance policies, even your gas, water and electric company if you owe a surplus to the utilities company. Often, these service providers prefer to help the consumer and reduce the amount owed in order to retain their business.
In order to negotiate your bills with your internet or TV service provider, you need to call their customer service department and explain that the price is not worth the service and you are looking to reduce your monthly bill or you will have to switch to their competitor. This can sometimes be difficult and awkward to have this discussion over the phone, but it is effective in reducing your monthly TV bill. This is a great way to save extra cash each month.
The best leverage you have when shopping for TV service is the option to start streaming television and consolidate your entertainment experience with your internet service provider. You can also speak to your internet provider and look for bundling options to combine your internet and television package to better suit your lifestyle needs.
When shopping for auto insurance savings, it is helpful to have a safe driving history. This helps give you a reason to ask for lower monthly payments because they know you are historically a safe driver.
If you have encountered any tickets, accidents or incidents that would cause your insurance company to raise your monthly insurance premium, try to speak to your auto insurance representative to figure out how to get a reduction. Some auto insurance companies will allow you to pre-pay for six months of coverage for 20-25% savings on your auto insurance policy. You can also look into taking online or in-person defensive driving courses to get 10-15% savings on your auto insurance policy.
5. Do your research before buying
Avoid impulse buying any items. If you think you need something, take your time to think about why you need such item. What is the point of purchasing? How much does this item cost? Take at least 24-hours and think about your prospective purchase and do your research before buying. It is important to compare online prices for video game consoles or televisions because they are high-priced items with a lot of new technology every year they make new updates. When comparing online prices of kitchen appliances, it is good to get a good judgement of price ranges you are willing to spend before going into the department store in-person. This way you will be prepared for sales people trying to sell you the more expensive model.
Lower priced items are a little bit different. If you are searching for discounts on diapers, toilet paper and other everyday household items, it is good to search on websites like Amazon, Walmart or Target to compare the major brands that each online retailer offers. Each will offer special discounts and if you are a member of Sam’s Club or Costco, you can find even bigger discounts on everyday household necessities.
Bonus: Earn more money by starting a side hustle
With the power of the internet and the world at our fingertips, it is easier than ever to find extra work in your local area online. Finding extra work is a great way to save extra cash. There are many easy jobs available like dog walking, personal grocery shopping and food delivery services. Side-gigs don’t have to be complicated or time consuming. Instead of spending two hours on the couch watching TV, you can pick-up side-gigs on apps like Wag or UberEats to earn extra money.
If you are not interested in those small side-gigs but you want to get paid more money in your spare time, you can find online jobs available on Fiverr or Upwork. With an almost unlimited amount of online guides and tutorials, there are many educational resources available to learn new skills and development new strengths to help you find new opportunities.