Life is short. I want to spend it exploring and experiencing the things I enjoy most. Are you the same? Usually, we are limited by our money, whether we save for a nicer home or a lavish holiday. With this in mind, here are some thoughts about how I ensure that my earnings contribute towards what matters most. For me, it’s my favourite traveling adventures!
Just so you’re aware, people call me cheap or frugal all the time as a result of this. However, I think I’m cheap for the right reasons. Frugal with a cause!
Evaluate your regular expenditures
I’m not a frequent coffee drinker but I love hot chocolate. I try to enjoy a good quality one as often as I can – it powers me up for the day. However, like coffee, each professional hot chocolate can cost about $4 a cup. If I were to indulge in one every business day, that’s about 250 hot chocolates, or $1,000 over the course of a year. If you consider that sometimes it’s tempting to have more than one cup a day, this can easily exceed $1500. That’s a lot of money that could otherwise fund a great gift for yourself or even contribute to a trip.
Alternative: make your own coffee/hot chocolate at 10% of the cost, except one day a week as a treat. Money saved: $1000 – ( 4/5 * 250 days * 10% of $4) = $920 a year
Negotiate now with your bank or landlord
For home-owners with a mortgage, avoid paying mortgage fees at all costs. You are already forking out interest every month to the bank for 15-30 years, why should they collect more money via unjustified fees? Your bank doesn’t need to charge an account keeping fee, a package fee, or whatever else they wish to call it for $300 a year. Don’t be scammed, check your statements! Demand better interest rates and demand for the fees to be removed – or be prepared to walk and change banks entirely. You can do it! – and it will save you up to $500 per year or more for the life of your loan. Check out the latest deals from Ubank or loans.com.au.
As a renter, negotiate on your lease. Make a suggestion to your landlord for a one (or even two) year lease at a discount instead of a six month lease. They will prefer the certainty more often than not – but this depends on the local rental market. Alternatively, do you have any household skills such as gardening or minor maintenance? Most landlords will recognise any efforts that save them money and establish trust – they’re billpayers just like you – and often opt to keep rent down in favour of a valued, trustworthy tenant.
Money saved: approximately $500 per year
Save money by scrutinizing every bill
Bills are a repeat expenditure that are obviously unavoidable. However, you can reassess and renegotiate on them to find a better price or cancel services you are no longer using. A great example is health insurance – I recently saved $20 a month by changing to Bupa with the same benefits – plus I received a month free ($100). Over the course of a year, that’s 12*$20+$100, ie. $340. It only took about 15 minutes to change over, too! Scrutinize every single bill once a year – that’s my philosophy.
Another excellent strategy to save money is your mobile and internet bills. For those who are no longer in contract with their mobile phone, you can easily switch to another provider (for example Amaysim’s mobile offers) and save 50%+, ie. $30 or more per month on a $60 plan. Phone providers like Telstra thrive off contracts that have expired. Internet bills are similar – are you really using that 500GB plan for $80/month, or are you okay with having your speed capped for a couple of days? TPG has a few deals including $40 per month for internet and home line rental, which is compulsory for ADSL anyway.
Money saved: Health ($340) + phone ($360) + internet ($480) = $1,180 a year
Other similar suggestions:
- Ensure your regular dentist trip is recommended by your health ensurer (lower gap payment)
- Claim your overseas trip immunisations on private health
- Switch electricity and gas provider for a better deal
Don’t eat into your weekly savings
Wining and dining is a social necessity that most – myself included – usually won’t give up just to save money. However, this adds up quickly on a regular basis ($20-40 per person once a week), and it can cost you even more than your bills if you’re not careful. My best strategy here is that I often make myself a filling entree at home, and have another entree at the restaurant. Sometimes, I just don’t need to fork out $30 for a 250gm steak with my friends. Do you agree? If you want to feel extra savvy – join me in having some free icy water with your meal and skip the beer or soft drink. You can probably enjoy a better drink at home later anyway, right?
As a general rule, the entertainment book saves me a lot of money. It’s always my first port of call when eating out or booking an event. It’s filled with 2-for-1 deals at popular restaurants and other entertainment venues, or 25% off at worst. It costs about $60 but you will easily save much more than that after your first 2-3 uses. Find the equivalent in your state/country.
Money saved: let’s say you only eat out once a fortnight and save $20 with these methods – that’s $520 a year. You could easily double that if you ate out more often and opted out of drinks.
Grant total saved: approximately $3,100 per year. What would you do with that extra cash?
What other strategies do you have to save money in everyday life?