Ever wondered how you used to survive on that minimum wage job years ago? Somehow as your income has grown, your expenses have grown as well. Perhaps it’s only natural: few of us even have time to “sweat the small stuff”.
Yet there are so many ways to cut the cost of living without being thrifty or frugal. A few good habits can really pay off and in this article we show you some simple suggestions that could literally save you thousands of dollars: almost $15,000 in the below examples!
#1 – Cut Your Mortgage Cost
Ok, so this first one is not strictly trimming the fat on today’s expenditure, but it will help you improve your financial outlook. Housing is the largest expenditure in the average persons budget and it offers the largest scope for saving money.
The average new home loan in the US is around $300,000 these days. On a typical rate of 3.5% for a 30-year repayment term, that is a total of $185,161 in interest. But if you simply rounded up your monthly repayment from $1,348 to $1,400 – an additional $52 per month – you would save a whopping $13,296 in interest and would pay off your mortgage almost 2 years early!
All it takes is a 5 minute call to your bank, do it now! Note: Double check that you won’t trigger any early repayment charges first.
#2 – Save on Fuel
Simply by doing a quick google search I was able to find a fuel price comparison website that informed me of 60 gas stations within 5 miles of my location. The most expensive gas station was $0.72 per gallon pricier than the cheapest. Given that the average fuel tank can hold about 12 gallons, that equates to a potential saving of $8.64 per tank of gas.
The average ‘sticker’ fuel economy of a new car is 25 mpg (though you are likely to get less than this figure), and the average distance driven each year by a car owner in the US is 12,000 miles. That implies potential savings of around $350 per year simply for doing a quick search on your phone.
Of course, your saving could be substantially bigger depending where you live (big cities tend to have even larger price discrepancies), how far you drive, and how much of a gas-guzzler you own. I have seen reports of up to 35% price differences between neighboring gas stations, meaning potential savings of over a thousand dollars per year.
#3 – Hack Your Grocery Shopping
Have you noticed just how much of your budget is spent on grocery shopping? Groceries are one of our largest expenditures yet many of us simply head to our favorite local store and buy everything we need.
In most cities there are several competing grocery supermarkets and the price difference on everyday items can be very surprising. I compared a totally random basket of 14 items at the 4 competing stores near me and found that the most expensive store was $15 pricier than the cheapest for the same goods. On a weekly shop that is a saving of almost $800 in a year!
Of course, there are also plenty of coupon websites and special offers around but the point of this article is to provide easy ways to trim the fat when it comes to expenditure. So to make some meaningful savings on your groceries here is a quick hack.
Simply save the receipt from your latest weekly trip to the grocery store. Next week instead of visiting your favorite store, head over to one of the competing supermarkets and buy everything on the receipt from the first store. If you have several competing stores you can visit them all over a number of weeks. If you are feeling particularly lazy, you don’t even need to visit the stores. Instead, check the prices via the online shopping cart that most large grocers have nowadays. When you come to compare the receipts you may be in for quite a surprise. Can you beat the 23.5% savings I made in the random basket above?
#4 – Slash your Cell Phone Bill
How many of your phone friends still don’t have a smartphone? Virtually everyone these days does, and virtually everyone is on either WhatsApp, Viber, Line or WeChat. So why are you paying for bundle minutes and texts when your data allowance is enough? Get on to your cell phone provider now and find the right deal for you (check out those great data deals that are ‘exclusive’ to iPad or Android tablet users, they usually work fine in a smartphone). And don’t worry about going over your data limit – there’s an app for that.
In Italy this year, instead of paying for minutes, SMS and data at €18/month ($20/month) I got 1 years supply (150gb) of traffic for just €99 ($105). That is a saving of $135.
For international calls, Skype, Google Voice or others offer far more competitive rates than your cell phone provider or for that matter your landline provider if you still have one.
#5 – Fly for Less
Nowadays there really are some amazing tools for finding the best travel & holiday deals. Most people know about sites like Skyscanner and Travelocity. However my personal favorite for flights has to be Google Flights. With this phenomenal tool you can:
- Compare prices from up to 5 departure airports and 5 arrival airports simultaneously
- Filter preferred routes, airlines, and prices and compare deals on an easy-to-read chart
- Tag planned travel routes and track the price change over time via email notifications
In summer we visited my in-laws in Siberia (Russia) and thanks to Google Flights I first found the cheapest route, then was able to book the ticket at a cost of just $1125 a couple of weeks before departure. I saved over $100 by tracking the price and almost $700 dollars on the final price as shown in the graph above.
#6 – Get the Cheapest Hotel Rate
For hotels, like flights there is a cornucopia of websites looking for your business. I have used several (Expedia, Booking.com, ebookers etc) and do not have a favorite. Instead I have found the best way to save on hotels is a multi-pronged approach:
- Check the prices for the dates you require on your favorite comparison website
- Visit the website of the specific hotel you are looking at and check direct pricing
- Phone the hotel and enquire about prices and availability
One definite “don’t” is to never walk into a hotel and book at the reception. You are likely to pay well over the odds. I once saved $50 on an overnight stay at a hotel in Scotland by pulling out my phone and booking the cheaper quote direct from the hotel website. The hotel manager made me wait 10 minutes until the booking came through on their system, but it was one of the easiest $50 I ever made!