The Art of Saving Money Painlessly

[jeffrey]

For the vast majority of people, paying off debt and saving money can be done painlessly. That is to say, most people can pay off their current debt and start a saving fund without making major changes to their current lifestyle. How can this be done? By simply rearranging how you spend your money.

Although we don't often think about it, there is an art to spending money efficiently. Like any skill, it's a matter of study and practice to get better at it. While some people are better at picking up the skill than others, anybody can easily learn the basics of this art which can save them thousands of dollars a year.

Lets take an easy to understand example. Let's say that you purchase a cup of coffee on the way to work everyday at a local shop for $2.00. This would meant that you spend $40 (20 days x $2) a month. Most people would probably do this without even thinking twice about it.

Now if you made the same cup of coffee and placed it into a thermos each morning before you went to work and took it along with you, the same coffee it would cost you about $0.50 a day. That adds up to a total of $10 a month. By making your own coffee instead of purchasing it at a store on the way to work, you save $30 a month (over $350 a year) without giving anything up (you still get your coffee everyday). All you have done is rearranged the way that you spend your money.




Let's take another example. You have your phone service and pay a certain amount each month for it. But are you getting the best deal on your service for the way you use the phone? Chances are you aren't, but the phone company isn't going to tell you that on their own. Most people can save over $100 a year on their phone service by calling their phone company and signing up with a discount or bundled plan geared toward the way they use the phone as opposed to the standard plan with extra options that most people have. Here again, you are getting the exact same service you currently receive, but are paying less for it by rearranging the service to your advantage.

There are literally hundreds of ways that you can rearrange the way you spend money. In the process, you will get the same goods or services that you are currently receiving at a fraction of the cost that you are currently paying. The money saved can then be put forth to eliminate your current credit card debt and start a savings plan. All it takes is a little understanding of the art of spending efficiently and to actively look for ways you can rearrange how you spend your current income to make your purchases more efficient.

[Diolla]

Another way is to use your direct deposit. My company allows you to deposit into several different accounts so I just set it up to put 15% (net) into savings and the rest in checking. This way even when I get a raise at least a portion is going to increase my savings. It is a practically painless process because like taxes, insurance and 401(k) contributions it is gone before I even see my checking deposit slip.

[getforfree]

great article.

You still can get the same thing for less, but you might have to do some extra work like cooking, repairing, look for the best deals and coupons. But it's well worth it. Because the money saved is better than money earned ( doesn't count towards your income [might put you in a lower tax bracket] and you don't have to pay tax on it)

[krayziebone33]

Spending money more efficiently is something that I get better and better at everyday. Thank you for posting this. Things like this keep me focused and let me know that I am doing the right thing.

[The Budget Man]

It's good to think of where our money is going. When we find savings we can use them to remove debt more quickly.

After a seminar recently I was chatting with an aunty who was taking me to the airport. The dicscussion turned to some of the topics I'd been speaking about.

She was horified when I told her about my annual review of bank accounts. She would never change the bank where her accounts are!

Each year around my birthday I check my bank accounts to see if I'm getting the best deal. If needs be I change. The results can be quite large savings as different banks etc keep changing what is on offer.

This idea of an annual review can be pushed a little further and it can include insurances, telephone as mentioned above and just about any service you regularly buy.

Help Please: I haven't been able to work out how to get the best prices for dental. Has anyone worked out how they can compare prices for services such as dental, hospital and legal?

[HelpMeFriend]

Trying to redirect your spending can be hard for those who don't know how.
I am learning how to spend less on take-out food, saving gas, and all around money tossed away.

[ZenQueen50]

There are numerous ways to save, I mean truly save. The key thing is that you learn to discern the offers out there to make sure you won't be *had*. I have a checking account with US Bank, which offers cash rewards if you use the debit card to purchase items from their connected shopping link to 150 sites.

For me it's worth it, since drugstore.com is one place I buy from every month. For clothing, it's Land's End and Eddie Bauer. What's key is that I hit drugstore.com the first week of each month because that is when GNC has their 20% Gold Card savings. I also treated myself to a few Vera Bradley accessories, including a small handbag from e.bags. All the items were on sale, AND, I received $5.00 cashback. This is actual money that *collects* in my rewards account. I can transfer this money to my checking account in increments of $5.00. Not a bad deal.

Discernment is important to know if you are truly saving. Since I go to GNC via drugstore.com, I can tell if prices are deliberately inflated to get their money back. They aren't.

For now, that's not a bad deal. It's also a good way to add to my $20 Challenge account.

[checkthebudget]

One of the best and easiest ways to save money is by dropping your landline and using Skype. It is $3 a month vs the $50 a month you probably spend on your landline and long distance. That is $600 a year you can save with no loss of service. One thing to keep in mind is that skype does not support 911 calls. So you will need to have a cell phone (which you probably do) for that. Or, I suppose you could just keep the list of emergency numbers handy (police, fire, ambulance)...

[MaskedMarvel]

I find that one of the best ways is to analyse your expenses. Then you can see where you spend money where maybe you shouldn't.

[snafu]

We plan purchases. For example, since bedding and linens are on sale in January, I cleared out the linen cupboard, bagged anything worn-out, elastic stiff, threadbare, stained to donate to SPCA [used for animal bedding]. Returned items that didn't belong and returned the sets in neat stacks. I need to replace two sheet sets and two bath sheets. The difference between the sum paid and the regular sum is my 'cost avoidance.' I will transfer that amount to savings. Shocking how that adds up!

When gas prices spiked, I became much more aware of my need to better manage errands. I'm now in the habit or arranging errands/routines starting from the furthest out and working my way back. The bonus has been the amount of time saved by using the most efficient route[s].

For health reasons I wanted to limit the amount of fast food/junk DKs ate. It was obvious that we picked up burgers or pizza when we were pressed for time and there was no dinner prepared at home. The most efficient way to stop that was to have a menu plan. It was remarkably easy to work out a quick plan with emphasis on the busiest days.

Setting up dinner the night before for a crockpot/slocooker, or prepping like they do for restaurants so that the item is shoved in the oven by the 1st body home really, truly works! I no longer walk in the door with heavy heart wondering what I can make for dinner. There's a piece of paper on the side of the fridge outlining the meal.

The added benefit was the discovery that planning cut our food expenses nearly by half. DKs would rather make their own custom pizzas! They think cooking is fun and of course we nearly drown them in compliments when they make dinner.

[moneytutor]

Saving money is a stated objective for most Americans. The conversations about money discuss debt, bad credit, and an occasional remorseful story about money wasted. Most people will tell you that they need to do a better job of saving and they wish they had more saved. If saving money was a real objective for Americans, we’d have more saved.

The value of saving is not etched into the soul of people. Having a lucrative job and taking home lots of money should be adequate to bill a large savings account. Yet, people will buy more expensive cars and houses to show their success rather than increase their savings account. Real savers have budgets and have acquired good spending habits.

Saving is a skill that has to be learned. For example, when was the last time you told yourself you didn't have the money to buy something when you know you had the money. Buying things on impulse is what creates most of the bad spending habits.

January New Year's resolution could easily be - I want to save $2,000. We could easily stop snacking, buying latte's, pack lunches, and buy our groceries using coupons. But, the reality of setting an objective like this is to make it a goal. To have a saving's objective or reward for making the sacrifices would make it worth changing a few things in our budgets. Most people on the other hand want to have their cake and eat it too. They don't concern themselves with small dreams because a credit card can fix the smaller problems.

Credit card problems would never have been an issue if people used the pay as you go. The money would not have been in their pockets for the expensive latte's and the bad spending habits would never have been created. Finding money to save becomes simpler when you're broke.

Not having money to splurge and buy unnecessary item adjusts bad spending habits immediately. The wittiness of saying I don't have the money becomes a reality. You have no choice but to stop.

We the people of the United States of America are spoiled and live in the "Instant Gratification" world. Every want becomes a need. It takes training that begins when you are a child to help you truly develop good spending habits.

[Lindawool]

I would just like to say "hello".

[casinoroyale]

How are you?