Many people think that being frugal with their money means staying home and never spending money or having fun.
Let’s put it this way, if staying home and never spending money are the secrets to saving money, then, a lot of people would be saving a ton of money by now.
The truth is being frugal simply means having a thorough understanding of your finances and knowing how to best spend your money.
Figuring out the right steps to save money sometimes requires you to get some form of assistance. Sometimes, it only takes looking at your finances and spending habits at 10,000 feet view to see what you’re doing right and wrong. Or a combination of both.
Here are some money-saving tips to help you manage your finances.
1. Establish a budget
Your first step should always be to establish a budget.
You can do this by writing down all your monthly income and expenses in a spreadsheet, so you can get a holistic view of your finances. Decide which expenses are necessities and which aren’t, and plan to stick within your necessary expenses each month.
There are also some budgeting apps that can help you get started if the idea of working with a spreadsheet is intimidating.
2. Make money from what you buy… while getting the right decisions
You've likely heard the money making apps like eBates, Swagbucks, and Paribus. If you haven't, they are the apps that can help you money just by shopping the way you normally do.
My wife and I have made more than $5,000 in two years just by running these apps in our smartphone's background (for the most part, that is).
You can also make money from what you buy while getting the right decisions. That's what Spentapp is all about.
My family uses Spentapp and it turned our lives and finances 360 degrees for the better. It automatically analyzes our expenses, identify our money mistakes, and recommends financial decisions, which we use all the time.
It gives us up to 45% cash back on many things. If our yearly (non) food bill is $10,000 and the cash back is 20%, we get roughly $2,000 back. That savings right there.
With my brother and Spentapp's help, we paid off our $40K debt and saved $70K all in 2.5 years, reduced our grocery bill to $150 for a family of 3, and lived off well under $31,000/year. Now, we have saved over $400,000 because of the decisions we learned from Spentapp. That's our story with Spentapp.
Spentapp is such as a game changer we wish we knew a long time ago. We get the advice we need and make money, too. It's a double win for us. It could be for you as well.
3. Save with a purpose
You’ve likely heard of the importance of saving money each month, but that can be hard to do when you don’t have a goal in mind.
Decide what you want to put your money towards— whether it’s funding emergency savings or putting away for a major purchase, having a clear goal in mind can make saving much easier.
If you need help reaching your savings goal, a better option is to use Qapital. It can help you automatically save money by doing things you already do like riding a bike, cleaning your house, etc. It's a simple idea that has a great impact.
First, you set a goal. For me, it was to save enough to take a Las Vegas trip. I set “rules,” which, when triggered, transfer money into my Qapital account.
For example, if I meet my daily-step goal, $4 is transferred in. Or if I make a purchase of $5.85, the leftover 15 cents is transferred over.
To put things in dollar terms, we saved $6,000 last year towards our goals because of Qapital. We went from having budget headaches to perfecting our budget and saving money.
4. Save automatically
After you’ve given yourself a savings goal, your next step is to start funding your savings account.
If you find it hard to set aside money each month, one of the best things you can do for yourself is to automate your savings.
This ensures that your money continues to grow without you having to worry about putting money away. Doing this, your savings should add up faster than you think.
Automating your savings helps you to take control of your savings goals without actually even trying it.
That's the whole premise with Rize. I decide how much I want to save for each goal, set a deadline, and let Rize do everything from there. It helps me save without me taking a single step and lifting a finger.
Click here now to get started with Rize and make savings as easy as it can be.
5. Take advantage of employer match
If your employer offers a match on your 401(k), try to max out your contributions to take advantage of their match.
If you don’t, you’ll essentially be giving up free money at your employer’s expense. If you do, make sure you aren't paying too much fees on the ETFs and mutual funds within your 401(k) account.
According to Morningstar Research, the average expense charged by ETFs and mutual funds is 0.61%.
An app called Blooom will spot hidden fees, tell you if your portfolio is too aggressive or not, and find out how much you could be missing out on by DIY-ing your 401k.
To put things in perspective, if you have $100,000 invested, you would be paying $690. If that $690/year is invested instead at 15% compounded annually for 20 years, the result would be $73,681.15. Imagine if you have $150K, $200K or some more. Yikes.
Click here to gain access to Blooom for FREE. Let your 401(k) work for you and not against you. Blooom can help you with that.
6. Save spare change
Don’t overlook the power of your spare change.
Tossing your coins into a jar can quickly add up to an emergency or rainy day fund without hurting your wallet.
If you don’t use cash enough to get a lot of spare change, you may be able to take advantage of apps that round up your purchases and put the difference into savings for you.
Aside from Qapital and Stash, Acorns will roundup your purchases to the nearest dollar and lets you invest for as low as a cent into the stock market. Yes, with just $0.01, you can invest to 7,000 stocks while minimizing your invest risk.
Acorns will also give you cash back offers far higher than those from the biggest cash back sites out there. Plus, you get $5 bonus if you sign up using my link. These are just remarkable.
7. Create priorities
After you pay your bills and fund your retirement and savings accounts, you should consider your other priorities.
It may not be exciting to fund a homeowners or life insurance policy, but if the unexpected comes up, you’ll be grateful you have the backing of your policy.
Your local insurance agents can work with you to tailor a plan that makes sense for your lifestyle.
Bonus: Save for retirement
After you’ve spent your life working, you want to enjoy a comfortable retirement.
That can be difficult to do if you neglect to save while you’re working. Don’t wait to start funding your retirement or you’ll miss out on taking advantage of compound interest.
Even if you start by putting away a small portion of your salary, you’ll be better off than if you didn’t save at all.
These tips can help you get started on the path towards financial security. When you put these to use, you should end up with healthier finances and more money in your pocket.
What's making it difficult for you to save money? What strategies are you using to save extra money?