In today’s economy, saving money is more important than ever. However, saving when prices keep rising and paychecks stagnate can seem daunting. The good news is that making a few simple, frugal lifestyle changes can add to significant savings over time. Implementing just a couple of the habits outlined below could result in hundreds of dollars of extra money in your pocket each month. Learn eight easy, frugal habits to help you painlessly trim your expenses and reach your savings goals.
Habit 1: Make a Detailed Budget and Stick to It
The first critical habit for saving money is tracking income and expenses by making a detailed monthly budget. This allows you to see exactly where your money is going. Start by listing your monthly fixed expenses like housing, transportation, insurance, debt payments, utilities, subscriptions, etc. Then, factor in variable expenses like groceries, gas, dining out, entertainment, clothing, etc. Use past bank and credit card statements to build an accurate budget.
Once you have a budget, you can look for areas where you can cut back, such as eating out less or temporarily suspending a gym membership. Building some wiggle room into your variable categories can help you stick to your budget when unexpected expenses arise. The key is adjusting your spending to align with the budget you set.
Apps like Mint, You Need a Budget, and EveryDollar can make budgeting much more accessible by connecting to your accounts, categorizing transactions, and tracking your progress. However, a simple spreadsheet works too. The important thing is carefully planning where your money needs to go each month. Monitor your budget weekly and adjust as needed—Pro tip: Automate bill payments and transfers to keep yourself on track.
For example, Wendy makes a $3000 monthly budget with $1500 for fixed costs and $1500 allocated across variable spending categories like food, entertainment, clothing, etc. She finds that dining out quickly burned through her budget, averaging $400 monthly. She decides to cut back on takeout and cook at home more, budgeting $200 for dining out. This freed up $200 that can now go to increasing her savings each month.
Habit 2: Meal Plan and Cook at Home
Dining out is one of the biggest budget killers for many folks. Americans spend an average of $3,500 per year on dining out. Meal planning is an easy way to rein in this cost. Take time each week to plan home-cooked meals and grocery shop accordingly. This reduces food waste and ensures you have ingredients on hand for recipes. Cooking at home is significantly cheaper than takeout or restaurants.
Make cooking more efficient by preparing extra portions to refrigerate or freeze for lunches and quick weeknight meals later. Simple meal prepping saves more time and enables sticking to your meal plan—for example, roast extra chicken breasts in salads or pasta dishes. Cook a big pot of chili or soup for easy reheating. Bake a double batch of salmon patties or breakfast burritos to reheat during your week.
When cooking at home, opt for less expensive proteins like beans, lentils, eggs, canned fish, and chicken. Incorporate more veggies that are budget-friendly and packed with nutrients. Use leftovers creatively to get two meals out of one recipe. Your grocery bill drops significantly when you plan recipes and shop with a list.
Laura’s meal plans for the week ahead each Sunday. She picks three dinner recipes at home and plans lunches and quick breakfasts. She prepares an extra lasagna and a double portion of enchiladas on Sunday to reheat later in the week, saving herself time and money. Her weekly grocery bill is $75 instead of $150 previously on rushed purchases or takeout.
Habit 3: Buy Generic Brands
Brand names are expensive – generic and store brands are almost always significantly cheaper for the same products. Opting for generics can save over 25% on your grocery bill. For example, a 12 oz box of Cheerios may cost $5 while the store-brand Toasted O’s is just $3.50. The same goes for produce and meat, typically less expensive when store-branded.
Generic over-the-counter medications like ibuprofen must have the same active ingredients as name brands, so you pay mainly for the fancy label. Get into the habit of price-checking name-brand items against generics using store apps. Buy generic unless you find a product that warrants splurging on the name brand.
Sam always used to buy Kleenex tissues until he compared and realized the Member’s Mark tissues were 30% less but the same quality. Now, he scans generic prices first and only buys name brands if there’s a significant difference. This has saved him about $20 each month on household items.
Habit 4: Use Cash-Back Apps and Sites
Cash-back apps provide an effortless way to save on your regular purchases. Apps like Rakuten, Ibotta, and Dosh reward you with cash back for shopping at participating retailers online and in-store. Simply sign up for free link cards, then use the app to earn cash back when shopping or dining out. These apps can net you 10% or more back on purchases you would be making anyway.
Survey sites like Swagbucks and Survey Junkie pay you to share your opinion on brands, ads, etc., quickly adding to gift cards. Sign up in your free time to cash in on survey cash-back offers.
Use a cash-back credit card for all purchases and pay off the monthly balance for more significant savings. Citi DoubleCash offers a flat 2% back, while Chase Freedom cards offer bonus categories each quarter for 5% or more back.
Jessie uses Ibotta, Dosh, and Rakuten while shopping to earn around $50 back monthly in addition to her Citi DoubleCash rewards. She uses Swagbucks in her downtime to earn extra gift cards. The bonus cash adds up quickly by taking advantage of these simple programs.
Habit 5: Cut the Cord on the Cable TV
The average cable TV bill is a hefty $217 a month. Cutting the cable cord can save over $2500 per year. You can replace cable with lower-cost streaming options. Services like Sling TV, YouTube TV, and Hulu Live offer popular channels and shows starting at $35 monthly. Or opt for on-demand services like Netflix and Amazon Prime Video for $10-$15 monthly.
Are you still waiting to go full streaming? Try calling your cable provider to negotiate a lower rate for a bundle or promotion. Also, consider using an HD digital antenna to access free local over-the-air broadcast channels. Depending on your viewing habits, mixing some streaming services with an antenna may satisfy your TV needs for much less.
Marcus had a $180 cable bill but discovered he and his wife only regularly watched a few channels. They purchased a $35 digital antenna and subscribed to Netflix and ESPN+ for $30 monthly – saving $150!
Habit 6: Shop Thrift and Consignment Stores
Shopping secondhand is a proven way to save on clothing, shoes, furniture, home goods, books, electronics, and more. Thrift stores like Goodwill offer steep discounts on gently used items that you can score for a fraction of the retail price. Apps like Poshmark and ThredUp make secondhand shopping easy online.
Higher-end consignment shops are another option to find luxury brands at bargain prices. Items are typically in excellent condition; you can score designer brands for less. Check consignment shops in affluent areas for premium inventory.
Before buying something new, check if you can get it pre-owned first. Most items have been barely used. A few hours to a thrift shop can uncover some incredible finds.
Jada furnished nearly her entire apartment from thrift store furniture that she scored for cheap and reimagined with some paint. She shops secondhand for most clothes and estimates she’s saved over $ 5,000 vs. buying everything new.
Habit 7: Delay Big Purchases
A frugal mindset means avoiding impulse buys and postponing more significant purchases when possible. Do you need the latest iPhone model, or can your current phone last another year or two? TVs, watches, video game consoles, and more are frequently updated with newer versions. Examine if you can delay those big purchases by six months, a year, or more.
Wait for sales around Black Friday, Cyber Monday, and the holidays when prices drop. Buy last year’s models refurbished or used once the new versions are released. Take your time with expensive buys – think through the purchase and if it meets your needs now or can wait. Every delay of a $500 purchase gives you six more months to save up.
Habit 8: Negotiate Better Rates
Being a squeaky wheel pays off when you negotiate rates down for services. Call your service providers regularly, ask for better rates, or extend promotional pricing. Push for discounts to lower your monthly bills. This simple habit works best for cable/internet, phone plans, insurance policies, gym memberships, and more.
Ask to speak to the cancellation or retention department if needed – let them know you are considering switching to a competitor if they can’t offer better pricing. A quick call can save you $10 to $50 a month. Over a year, those savings add up.
Set reminders to re-negotiate rates every 6 to 12 months or when signing up as a new customer. Loyalty rarely pays – you have to ask for deals proactively. Javier renegotiates yearly with his internet provider and gym, saving over $500 annually with virtually no effort.
Implementing even a few of these easy, frugal habits can lead to significant financial benefits. Most require minimal time and effort but compound to significant savings over months and years. Your savings account will quickly grow by tracking your spending, cutting dining and entertainment costs, reducing bills, earning cash back, and rethinking significant purchases.
Jen’s Frugal Lifestyle Overhaul
Jen was tired of living paycheck to paycheck and wanted to overhaul her spending habits. She created a detailed budget and found the biggest problem was $600 monthly on takeout and drinks. She decided to cook more at home, meal prep lunches, and go out just once a week.
Jen switched to generic brands for groceries and household items, saving 15%. She cut cable and subscribed to Netflix and Hulu for $30 total. Jen signed up for Ibotta and Dosh to earn cashback on her regular shopping. She purchased a digital antenna for local channels.
These simple habit changes let Jen bank an extra $400 monthly. In 6 months, she has already saved $2400! Jen plans to continue being frugal and invest that money for her future instead of overspending on wants like takeout and cable. The savings add up fast when you get into frugal habits!
Conclusion
In summary, being frugal requires changing habits and mindsets around spending. Start by making a detailed budget to understand where every dollar goes. Look for areas to trim, like dining out, brand names, and cable bills. Meal plan and cook at home, buying generic brands at the grocery store. Take advantage of cashback apps and shop secondhand when possible. Delay big purchases by 6-12 months and negotiate better rates yearly.
Implementing two or three frugal habits can lead to hundreds of monthly savings. The small lifestyle changes compound over time, leaving you with extra money to boost savings or pay off debt. Tracking your progress with a budgeting app helps you stay motivated. Cultivating frugality takes some discipline but pays significant financial dividends. The savings enable you to worry less about money and use it more purposefully. Making frugality a lifestyle leads to true financial freedom.