Best Ways To Save Money

Saving is a bit like dieting; it may not be enjoyable, but if you keep the goal in sight and exercise some restraint, you can succeed. With dieting, you make a meal plan, and with saving, you make a budget. The goals may seem like opposites since with dieting you want to get thinner and with savings you want your bank account to get fatter; however, both require a leaner more disciplined approach to daily living.

Ways To Save MoneyYou can use your PC or laptop to keep your budget or your cell phone may have an app. If you don’t have a device that works for budgeting, use an old fashioned ledger and write everything out. Make a list of everything you need to spend money on and don’t forget to include the occasional night out, entertainment, car and home maintenance, etc.

Savings should be a line item in your budget. Decide how much you can spend on each item and that is all you spend, but don’t cut out every little thing and make your life so miserable and boring that you can’t possibly stick to your budget. With that in mind, here is a list of the best ways to save money.

A Savings Account

At least 10% of each paycheck should go into a savings account. While some expenses like rent or mortgage payments are fixed, you can save money on others like groceries, gasoline, restaurants, entertainment, and technology gadgets. While the car only needs maintenance about every three to six months, you should put some money aside every week so when maintenance issues pop up, the money is there to take care of them without dipping into your savings. The same is true for house maintenance.

Eating out once in a while is fine – everyone needs a little change or a break from cooking, but don’t eat out every night or the majority of the week. At that point, you are just wasting your money and could be eating much healthier at home. Entertainment such as movie rentals, Netflix, concerts, sports events, or comedy shows are important ways for you to keep your sanity and relax. You work hard during the week and you should be able to enjoy your life and the money you earn, just don’t blow half your paycheck all at one place.

Lastly, if you have a few hundred dollars left at the end of the month, you don’t need to find an excuse to spend it. Constantly upgrading your phones, tablets, laptops, computer screens, televisions, iPods, and other gadgets to the latest generation of technology is not so essential that you leave no buffer or emergency fund in your bank account. The greatest security you will feel is when you know, no matter what crisis or emergency comes your way, you have the financial stability to survive and overcome it.

If your net bi-weekly paycheck is $2,000, $200 should go into a savings account and just be forgotten. Instead of budgeting with $2,000, try to budget with $1,800. As with a diet, it may be painful at first, but when you begin to see results, such as your bank account growing and an increased comfort with your financial situation, the sacrifices will be worth it. Think about how much you should be saving each month and then implement the following best ways to save money.

Review Spending on Luxuries

Do you really need cable or satellite TV? You can get the same programs online the next day or just download them online and save the cost of cable. If you absolutely love your cable, check with other providers in your area to see if you can find a less expensive plan. Look into bundling internet, cable and home phone. Even if you never use the home phone, it may be cheaper to get the bundle.

SSpending on Luxuriespeaking of phones, check out your cell phone plan. Do you use all the services you are paying for? Can you save money with a cheaper plan that works for you? While discussing deals with the customer service representative, make sure to mention the promotions and discounts offered by other companies.


If you rent a lot of movies and never have the chance to watch them, start by not renting them at all. We all have one friend with an extensive movie collection – ask him/her to borrow a DVD or Blu-Ray disc once in a while. Most public libraries even have a movie section and you can check out the movies for free. Although saving $10 per month is not going to fund your retirement, this is an example of you recognizing your own wasteful spending and trying to execute on a plan to save more.

A Night Out

If you need a grown-ups night, consider inviting friends over to play cards, socialize, or barbecue instead of going out to dinner, a movie, club or bar. If you and your friends take turns visiting each other’s homes or apartments, you will all save money and have a great time.

Eating Out

Pizza, Chinese, or any restaurant delivery is convenient, but you can always just pick up your own food and avoid the delivery charge plus tip. Even if you order online to get special deals, you can still pick up and save some money. If the restaurant is somewhat out of your way, try to schedule an errand around the area to improve your efficiency and productivity.

Impulse Buys

If you really want to buy something, wait a week and see if you still want the item. Never buy something you don’t really need because it’s on sale. Impulse buying accounts for more spending than most people realize. This idea of not buying things you don’t need is easier said than done. Most Americans find it difficult to differentiate between rational and irrational needs and wants.

For example, I’ve wanted to upgrade my first generation iPad for almost 2 years now, but every time Apple comes out with a new product, I realize that the new gadgets would not offer a significantly improved user experience, taking into consideration what I use my current iPad for. I have a laptop, PC, and smartphone – do I really need another technological platform to access the internet, check my email, watch movies or videos, listen to music, or chat with friends? Be honest and introspective, and you’ll likely never have buyer’s remorse.

Bottled Water

Bottled water is expensive and the truth is that most companies simply filter tap water and fill plastic bottles. That “awkward” or “disgusting” taste is not that your tap water is dirty, but is a result of minerals and chlorine in your water. The sanitation districts and municipalities in most American cities do an outstanding job of cleaning and filtering water, but because these minerals are not harmful to your health, they do not spend the extra money to remove them.

If you do not like the taste, buy a Brita Water Filter and that should take care of it. If your refrigerator has a water dispenser, it may also have a filter, or you can buy a filter for your kitchen faucet and fill re-usable water bottles or glasses. This saves money and the environment.


While fancy coffees, Starbucks, Pete’s Coffee, and Coffee Bean are yummy, most coffees served are also high in sugar, calories and/or price. Making coffee at home and taking it with you in a re-useable to-go cup can save as much as $2.50 a day, $12.50 a week or over $500 a year. If you use artificial sweetener in your homemade coffee, you might also drop a few pounds. Win-win.

Our “Latte Factor” article can further explain the benefits of minimizing little expenses here and there. Though we don’t believe the little expenses are really the issues that prevent you from becoming a millionaire, the discipline you learn starting from the small stuff can lead to wiser spending when it comes to the big stuff, such as homes, cars, TVs, etc.

Don’t Miss Out On Life

Cutting back on luxuries doesn’t mean you have to skip that romantic dinner on your anniversary, birthday or stop celebrating special occasions, but being aware of how much you spend on non-essentials can help you budget wisely and save money. It will also make special occasions seem more special when a night on the town is a treat, and does not result in buyer’s remorse.

One important place for saving is to pay off high interest credit cards as quickly as possible. If you use credit cards only charge as much as you can pay off at the end of each month. This can save you hundreds, even thousands of dollars in interest.

Plan Shopping Trips

If you are like most people, you are always running out of milk, bread, cereal, toilet paper or some other necessity and instead of waiting in line at the grocery store, you just pop in to the convenience store on the corner to grab what you need.

Save Money On GroceriesConvenience is expensive and a luxury. It may not seem like that big a deal, but if you make that trade off once a week, you have spent an extra $52 in a year on just milk. Add in a candy bar, soft drink or other impulse buys and that amount can easily hit 3 or 4 figures.

Avoid those extra trips by keeping track of how much milk, bread, eggs or other staples you use in a week. Make a shopping list of everything you need for the week and buy it all in one trip. You not only save money on groceries, you use less gas and time.

Remember, your time should have a value placed on it as well – running around groceries stores 3 times a week, when you could be resting, spending time with your kids and family, enjoying a hobby, or picking up a new skill like blogging, is essentially a waste of your life. If you do run out of something, take the time to go to the grocery store and use the self-checkout or express lane.

Brown Bag Lunches

While preparing lunches can be a hassle, you can save lots of money, especially if you and your spouse buy from restaurants or cafeterias near your offices. By preparing lunches at home, you can probably save at least 50% of the cost of eating out. If you and your spouse each spend $10.00 for lunch, bringing your lunches to work saves $50.00 per week or over $2,500 in a year. Even if you can’t save any money, think about the overall benefits to your health, self-esteem, and gym membership expenses.

If you have kids, breakfast and lunch at school can also be pricey. As far as breakfasts, a bowl of cereal with milk is a lot cheaper than $2 to $3 school meals and takes only minutes to fix. Furthermore, the average cost of a school lunch in America is about $2.30 for elementary school students, $2.50 for middle schoolers and almost $3 for high school students, and that’s only for the minimum cafeteria food.

Throw in Frito pies, chicken fingers, burgers, fries, chips, and/or a drink, and you are likely talking about at least $5. If you think about the nutritional value of the foods consumed by your kids, then you’d probably be better off packing them a pound of bacon and sending them on their merry way to school and, in the future, the doctor’s office.

Buy Generic and Store Brands

Generic and store brands are usually the same quality as name brands, but you aren’t paying for advertising, fancy packaging or other costs. Grocery chains like Kroger and ShopRite buy their store brands from large companies like Ralston Purina, Bird’s Eye and Green Giant and the companies put their own store labels on the products. It is the same stuff inside with a different label outside. The same goes for Costco’s Kirkland, Sam’s Club and Sam’s Choice, and Walmart’s Great Value brand.

It doesn’t hurt to try store brands and it can save you a bundle. There may be some items, like coffee, peanut butter or mayonnaise, that don’t taste the same as the brand you normally use, so if you prefer a few name brand items, look for sales and coupons and buy extra jars or cans when you find low prices. If you spend $10 less each week for groceries, you will have saved $520 per year, and really, saving $10 is easy.

Non-food items like cleaning products, personal care products and toilet tissue are usually cheaper at dollar and discount stores than at grocery stores. With dollar store deals, it is usually better to buy name brands even if off label products are cheaper since the cleaning products may be diluted and the paper products are often sold in smaller rolls or are of lower quality than brands you know. These products usually last longer than ones found at grocery stores, so one trip a month to the discount store should be enough.

Pharmaceuticals and OTC Medicines

Most Americans do not know that the FDA requires generic versions of name brand drugs, including baby formula, to offer consumers the same health benefits that their name brand counterparts provide. Instead of spending millions or billions on marketing campaigns and R&D, generic pharmaceutical companies pass their savings on to consumers while offering the exact same ingredients as brand name drugs.

Generic Prescription Drugs

If you take a prescription medication regularly, ask your doctor if there is a generic substitute. If there is no substitute, consider ordering your medication from an online pharmacy. My friend’s daughter uses Advair daily for asthma and her prescription is $240 per month. At an online pharmacy, she gets a three month supply of Advair for $240, a 66% savings. If your health insurance covers your medication, you probably can’t save this way, although new healthcare laws may benefit you.

Over the counter medications can be expensive, especially if you use them regularly. While most people will buy generic aspirin, many choose name brands for ibuprofen, acetaminophen or naproxen sodium. These popular analgesics are available in store brands that are just as effective as the name brands. Check the labels for ingredients and dosages and you will find there is no difference except in price. Store brands are often as much as a dollar less. The same applies to other OTC medications like decongestants and cough syrups.


Lastly, let’s discuss cigarettes and I’ll be brief about it because, let’s face it, if you don’t want to quit, some guy telling you to quit and save money over the internet isn’t going to result in that epiphany. Nonetheless, with cigarette prices and taxes resulting in a pack costing $5 to $10, depending on where you live in the United States, pack-a-day-smokers could save between $1,800 and $3,600 a year.

If you add in the extra costs associated with smoking, such as increases in life and health insurance premiums, lighters, ash trays, gum and mints, unnecessary stops at the gas station, excessive teeth whitening and mouthwash, dry cleaning, and the ridiculous medical bills of the future, you are literally talking about hundreds of thousands of dollars over your lifetime.

Buy A Fuel Efficient Car

Fuel Efficient CarsIf you do the math, you will find that if you replace your car that gets 20 mpg with a car that gets 30 mpg and you drive the American average of 15,000 a year, you will save 250 gallons of gas. At $4.00 a gallon, that adds up to $1,000 per year. Before you rush out to buy a brand new car, consider that new cars typically lose 25% to 40% of their value in the first two years. If you buy a two year old car, someone else takes the loss. Since a used car costs less, you also save on interest for the car loan and get lower insurance premiums due to a lower cash value.

To get the most from your energy efficient car and save gas money, it is necessary to follow suggested maintenance schedules for oil changes and tune ups and to keep the tires properly inflated. Under inflated tires not only wear more quickly, they lower the gas mileage on your car. You can buy an inexpensive tire gauge at the auto parts store and check your tire pressure weekly to get the most out of your tires and your gas.

Saving and Investing

The first goal of your savings plan is to accumulate between 6 and 12 months expenses in your account. This is your financial parachute that will protect you and your family in case of an emergency, such as a job loss, injury, medical bills, litigation, natural disaster, etc. This money stays in a savings account or invested in some type of short term security so it is liquid and easily accessible.

Once you have ensured your short term financial stability, it is time to look at investments that have a higher return than bank interest. Secure and safe investments include certificates of deposit, high yield bank accounts, Treasury bonds, municipal bonds, investment grade corporate bonds. Certificates of deposit can be bought in 3, 6, 12, 36, 48 and 60 month increments. The longer the CD takes to mature the higher the interest rate. Penalties for early withdrawal can be stiff, so it may be best to start with several different CDs, like a 3 month, a 6 month and a 12 month, but we would not recommend a long term investment in CD’s at current yields because interest rates are depressed. When the CD matures you can roll it over or take out the interest and reinvest the initial money.

For the foreseeable future, equities seem to be the best investment. Though the subject requires a lengthy article to cover the pros and cons of investing in the stock market and the many strategies available today, it is my opinion that the greatest returns in the next few years will likely be generated from retirement accounts, such as 401Ks and IRAs, and self-managed portfolios invested in stocks. If you have some investment knowledge, you can pick your own stocks, or simply choose a passive index fund or ETF from Vanguard or Fidelity.

Once you save enough money, you can put your money to work for you instead of working for your money. While no one enjoys making sacrifices, with a few small changes, you can get thinner and richer at the same time.