The past year has been a rough one, y’all. If you feel like you’ve been struggling to stay afloat financially, you’re not alone.
It seems as if everywhere we look, costs are rising. A recent report from the U.S. Bureau of Labor Statistics showed that the price of food, housing, health insurance and other services increased more than 6% in 2022. Harsh.
It doesn’t help that some financial experts believe these price hikes aren't so much the result of basic Econ 101 supply-and-demand curves as they are likely due to so-called "greedflation." In a recent report, the Federal Reserve Bank of Kansas City found that "the timing and cross-industry patterns of markup growth are more consistent with firms raising prices in anticipation of future cost increases, rather than an increase in monopoly power or higher demand."
All that's to say, those are shifts that can't be compensated for by making your coffee at home or skipping a dinner out. Skipping the occasional $6 latte isn't going to help you pay off $40K worth of student loan debt, after all. While it can't hurt (six dollars not spent is six dollars saved!), there are better ways to cut down on your monthly expenses and save a bit more each month.
That's why we asked money experts Erin Lowry, author of the Broke Millennial series and the Broke Millennial Workbook and Bola Sokunbi, author, founder and CEO of Clever Girl Finance, to dish out their best advice to save money and build wealth, along with some genius aha! tips and tricks that will help you find more money and cut costs where it counts.
1. Gradually boost retirement savings.
Changing your money habits can be hard. There are all kinds of benchmarks and rules floating around concerning what you're "supposed" to be doing with your money, like saving 15% of your income each year for retirement or following the 50/30/20 rule (50% of your income goes to needs, 30% to wants and 20% to debt payments and savings), that aren't realistic if you're living paycheck to paycheck. Instead, learn to relish baby steps when it comes to setting aside money for retirement. "Start even as low as 1% and increase it by 1% every three to six months as you work toward your goal," says Lowry. "It’s something. So start there."
2. Assess what you're streaming.
Take a close look at the services you're paying for each month. Do you have cable, but only watch streaming services like Netflix and Hulu? Cut the cord! In the same vein, if you have subscriptions to multiple music streaming services (say, Spotify and Apple Music), pick your favorite and drop the others. "Set aside some time to get rid of things you're paying for but not using," says Lowry.
3. Negotiate your bills.
When it comes to your bills, it can pay to advocate for yourself. Take car insurance, for example: Call the company and ask if there is anything that can be done to reduce your monthly payments. "If you haven’t had to file a claim in the last year and you have a pretty impeccable driving record, but your auto insurance is going up, search around to see if you can get a better deal," advises Lowry. "Then go to your current provider and say 'Hey, are you willing to match this? Otherwise, I’m gonna switch.'"
4. Stop renting your router.
Did you know you're probably renting your router? Most internet companies provide a router when you first set up service — and then charge you every month for its use on top of the cost of your Internet. Instead, consider buying your own Internet router and sending back the provided one. It's more money up front, but you can save you up to $50 a month depending on your Internet provider.
5. Invest in smart plugs.
It may sound like a small move, but the experts in the Good Housekeeping Media and Tech Lab say that spending as little as $10 on a smart plug can help lower your electricity bill. Smart plugs fit into your existing electrical outlets and accept the plugs of devices like lamps, fans and coffee makers. You can then use a smartphone app to set schedules for turning off lights and appliances and making it so they won't draw power when not in use.
6. Evaluate your bank fees.
"In my opinion, the amount of money that gets wasted to fees is huge," says Lowry. "There’s absolutely no reason you need to be paying $12 a month because you don’t carry a minimum daily balance of $500 or whatever hoops the bank is asking you to jump through." While $12 might not seem like a lot every month, it does add up over time, and could be an unnecessary expense if there are other options. "Are you being asked to pay any sort of monthly minimum fee on your checking or savings account?" asks Lowry. "If so, consider switching banks."
7. Set aside a "fun" fund for yourself.
No one can (or should) completely strip their budget down to the bare minimum. For example, it's not realistic to say you'll never dine out again. "You tend to swing wildly in the other direction if you try to deprive yourself for very extended periods of time," says Lowry. "Instead, have a release valve to help with the pressure if you're trying to achieve a big financial goal."
She suggests setting aside a certain amount of money every month (or week) that's dedicated to fun stuff — e.g., going out to eat or making an impulse purchase — so those types of purchases are budgeted for and don't derail your big-picture savings plan. To make things easier, you could even set money aside on a specific debit card or withdraw a set amount of cash to pull from. This way, you won't be tempted to go over your "allowance."
8. Find a high-interest savings account.
If possible, make the money you already have work harder for you. Even if you don't have extra money to throw into investments, you can transfer all of (or some of) your money into a high-yield savings account. "Right now, inflation really hurts, but the one place that we have seen an advantage to it is that savings account rates are skyrocketing again," says Lowry. "So if your bank is only giving you 0.01% or 0.05%, it might be time to move your money." Lowry explains that you can find accounts that offer above 3.5% or even more than 4% annual percentage yield (APY), she says — just make sure the bank is insured by the Federal Deposit Insurance Corporation (FDIC), which protects depositors against losing their money if the bank fails.
9. Introduce new revenue streams.
If you feel as if you've done all the budgeting you possibly can but still have more money going out than coming in, it's time to figure out a new approach. "If you have nothing else to cut out of your expenses, the next step is to think of how to earn more money," says Sokunbi. She recommends monetizing your skills — think coding, catering, tutoring or crafting items to sell on Etsy. Another idea? Decluttering your home and selling the things you no longer need. If you have the time, you could consider a part-time job, but you'll want to keep your mental and physical health top of mind. If you're stretched too thin, you'll burn out.
10. Use online coupon tools.
Never pay full price again! If you're buying something online, do a quick search for "discount code" and the retailer name before you check out to see if there are any codes you can use. You can also download deal aggregators like RetailMeNot and SlickDeals or browser extensions like Honey (also called plug-ins, they sit in the toolbar of your Web browser) to scan for savings automatically. Put the money you save with those coupon codes directly into your savings account to grow your stash of cash.
11. Do a deep dive into discounts.
You'd be surprised by how many businesses give discounts for birthdays or offer a special rate to students, teachers, seniors, first responders, military members and veterans, so always make sure to ask (nicely!) if any of these apply to you.
12. Cut back on takeout (and food waste!).
If you regularly find yourself throwing out unused groceries because you don't have the time for meal planning or you're constantly ordering out to avoid cooking, consider signing up for a meal delivery service. It may seem like you're spending more up front — and certain services are definitely more expensive than others — but because these kits only come with the exact amount of ingredients you need to cook the meal, they can help you avoid food waste (a.k.a. wasted money), especially if you're only cooking for two or one. Some brands, like EveryPlate, also offer new member discounts that drastically cut down the price of the first few kits.
13. Swap, don't shop.
Sokunbi suggests connecting with your friends, neighbors and family to set up item swaps. Maybe they have a kitchen appliance or a piece of sports equipment they don't need and you do, or vice versa. Or join your local Buy Nothing community, so you can give away items you don't want and snap up things you'd like to have. Then — it bears repeating! — put the money you don't spend on new stuff toward your financial goals.
14. Never pay full price.
Items like TVs, electronics, large appliances and grills routinely get put on sale, so hold off on buying until the time is right. For example, TVs generally go on sale around February (i.e., before the Super Bowl), and new models often have significant upgrades. Meanwhile, new models of large appliances, like washing machines, are often introduced in November or December, and retailers tend to mark down existing models to make space for the latest merchandise. Or, try checking out Amazon Outlet, a little-known secret that's a treasure trove of discounts — especially overstocked and clearance items after big events like Black Friday. We've seen unbelievable sales (up to 60% off) on everything from furniture to fashion to tech gear.
15. Go easy on yourself.
Money mistakes happen, and that's OK. "When it comes to financial wellness, it’s important to give yourself grace," says Sokunbi. "Start by forgiving yourself for any past financial mistakes, whether of your own doing or caused by others." Then, try to adopt a healthier mindset so you can put those mistakes in perspective — and forgive yourself when a slipup inevitably happens again. This habit will help ensure that you don't abandon good tendencies along with the bad ones. "Remind yourself that you have what it takes to succeed," says Sokunbi. What's most important is to evaluate what went wrong, and come up with a plan to try and avoid letting it happen again.
