Almost everyone wants to save more money. And saving is one of the key steps in money expert Clark Howard's 10-step guide to achieving financial freedom.
But how can you start saving when it always feels like there is more month than money?
Sometimes little steps add up to big savings. By making small changes, you can start to made headway toward reaching important financial goals such as creating an emergency fund and saving for retirement.
Simple Tips To Help You Save
The following tips are ideas to help you create more financial breathing room in your life without making major sacrifices.
Create a Budget and Set Spending Limits
Contrary to popular belief, budgets are not meant to be restrictive. Instead, they help you get control over your financial life because you can see where every penny is going. That will help you identify wasteful spending.
Team Clark has developed a five-step plan — The CLARK Method — to help you get started.
Save Your Change
If you think spare change is worthless, think again. Depending on your spending habits, it can really add up over time.
I made a rule for myself a few years ago: Anytime I get a $5 bill as change, I save it in an envelope. I have not spent a $5 bill in years, but I have saved up a few thousand dollars.
You don’t have to start with the folding money. Just grab a jar. At the end of the day, drop your spare change in it.
Also think about setting up change jars for your children or grandchildren. You can create different jars for different purposes such as saving for a toy. You might even offer to match what they save to encourage them to save more.
Always compare prices, especially on big-ticket items. You can use tools such as Google Shopping or Camelcamelcamel to see if you're really getting a deal.
Look for Scratch-and-Dent
When I buy a new appliance, I visit a local store with a scratch-and-dent area. A small blemish on the appliance can often get you a significant discount. Before you leave, check to see if the retailer will take away your old appliances for free when they deliver the new ones. If they don’t offer the service, you can bargain with them to make that part of the deal.
Never be afraid to negotiate a better price. I do this on any large purchase. For example, if you are ordering a computer, don’t just order online. Call the company directly and find out what kind of discounts they can offer. This has worked for me many times over the years. I’ve gotten free shipping, accessories like a printer or an upgrade. It can help to talk to a real person.
Use a Credit Card
If you trust yourself to spend responsibly and pay your balance in full every month, using a cash back credit card to pay for things like groceries and other bills can help you stack up rewards.
Team Clark likes the Citi Double Cash for its straightforward cash back policy that can net you up to 2% on every purchase.
Improve Your Credit Score
Having a good credit score can save you thousands of dollars in interest on a home or auto loan.
"If you can get up to around a 760, you're going to get the same benefits, the same offers, that someone who has an 840 score is going to get," says Beverly Harzog, a credit card expert for U.S. News & World Report.
Read these tips to raise your credit score fast.
Never Miss a Payment
Missing payments can add late fees and interest charges to your bills. To avoid this, set reminders on your calendar a few days before each bill is due to make sure you always pay on time.
If you think you’re going to miss a payment, don’t hide. Instead, call the company as soon as possible. There might be options available, and lenders are much more likely to work with borrowers who communicate with them about their circumstances early.
Review Your Bills
Check your monthly statements for anything you can lower or eliminate. Two major areas to examine are your cable bill and cell phone bill.
If you're paying $100 or more every month for cable, you can save anywhere from $420 to $1,200 every year by "cutting the cord." Check out guides to both live TV streaming servicese and free streaming services.
You can also slash your cable costs to $0 a month by using a digital antenna.
Switching to a cheaper wireless provider is one of the biggest ways to lower your cell phone bill. I have been using Mint Mobile for a little over a year now and am saving hundreds of dollars a year. You can see all of the latest plans and deals here.
Find a Free Bank
In this day and age, there is no reason to pay for checking or savings accounts.
If you're currently paying a fee, shop around. Start with your local credit union and comparison shop to find the best savings rates.
Also, set up a monthly automatic transfer from your checking account to your savings account. Even if you designate just a small amount, say $20, that money will add up. Many people intend to save money but don’t follow through. If it is automatic, you don’t have to think about it.
Shop Local Thrift Stores and Goodwill
Not everything needs to be new. I find most of my clothes at my local thrift store. Often they are still new with the tags attached or are very gently worn. Same for some household items!
Food and medications take up a big chunk of most people’s budgets. Many store brands are just as good (or better) than a name brand. In fact, some generic items are made by the same big-name companies but are relabeled under a different name.
And whether or not you have health insurance, you should shop around for prescriptions. You'll be surprised how much prices vary from store to store, and there are even apps to help you find the best deal.
Make Small Changes at Home
There are a few things you can do in your own home to save more money:
- Change furnace and air conditioning filters regularly.
- Use cold water to wash clothes.
- Check the setting on your hot water heater and lower it if it is set too high.
- Turn lights off when you leave a room.
- Use energy-efficient light bulbs.
Do Some Projects Yourself
I have saved tons of money by learning how to do home and auto repairs and maintenance for myself.
Tip: YouTube is great for learning DIY skills.
Anything you can do that keeps you from calling a professional means money back in your pocket. Also, visit your local hardware store. They often offer free training classes or advice on how to get a job done.
Visit Your Library
Libraries are a wonderful resource in our communities.
The free app, OverDrive, allows you to borrow books, audiobooks, magazines and other content from any library where you have a library card. (Yes, you can have library cards with multiple libraries!)
Also check out the Hoopla app to borrow movies, music, audiobooks, ebooks, comics and TV shows. I have watched so many good movies for free using the app on my TV. (More ways to watch free movies are listed in our guide here.)
Along with books, movies and TV shows, many libraries offer services you would not expect including free tax help, computer classes, language classes, sewing classes and cooking classes. And these days, many of those services are available online through your local library.
I was very surprised to find out that my local library also lends tools and other equipment such as tools needed for home and auto repair and maintenance.
Some offer GED classes that allow you to get your High School Equivalency Diploma, resume and job skills help, fitness and self-help classes, free internet and computer use, free genealogy services and even book sales. Honestly, the list goes on and on. Libraries are fantastic!
Call Your Insurance Company
Are you regularly shopping your auto and home insurance policies? If not, you could be paying way too much. Insurance companies rarely reward loyalty.
Start by getting at least three quotes from different companies and comparing them with your current rate. If your rate is still the best, call your current insurer to see if you qualify for any discounts.
But remember Clark’s advice: “The whole thing about insurance is not necessarily to have the lowest premiums — but to have the coverage you need if something goes wrong.”
Make sure you are insured by a company that will provide both the coverage and support you may need after an accident.
Research Free Computer Tools
Computer software can be expensive, but there are cheaper options out there. For every piece of software, there is most likely a free alternative such as office programs, PDF programs, graphics and other content editing programs.
Ready to get started? Sit down and figure out where your money is going every month. Make a list and identify where you can cut expenses. You might be surprised just how many ways you can cut down on spending — and how much you’ll end up saving.
More Ways to Save:
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