Q: We are a family of six and have been forced to move after only a year in our current rental home. Our kids are between the ages of 15 and 23 and so they can help, but I can’t believe how much stuff we accumulated in a year! And most of it is stuff we don’t really need. Our dream would be to buy a home so that we aren’t dependent on someone else’s decisions, but I can’t see how we’d ever be able to save up a down payment. It just seems that whenever we save up a sum of money, some expense comes along and wipes it all out. Are there any good ways to save money that are also easy to follow through with? ~Laura
A: Regardless of how long we live somewhere, it’s amazing how quickly our “stuff” can add up! And it doesn’t just add up to extra boxes when we move, a pile at the end of the driveway, in storage rental units, or on the give-away pile; it adds up on our credit cards as well.
Whether you’re moving or just doing some (financial) housekeeping, it’s always a good time to find ways to save money. Put each expense you have under the microscope to learn from your past habits. The trick with finding ways to save is to incorporate strategies into your lifestyle that you can stick with for the long haul. Much like a diet; the most successful ones are changes to your eating patterns that fit your lifestyle, not complicated calorie-counting schemes with specialty foods that are hard to come by.
Here are three unique ways to save money that everyone can do starting today:
1. Dissect your credit card and bank statements
Take the last two months of your bank and/or credit card statements to see what you’re spending the most money on (download your transactions into Excel or even print a few pages). Looking back over your statements will quickly identify spending habits so that you can make changes right away.
Make a list of all purchases under $20 to see what you were spending small amounts of money on. Then take a look at all of your purchases between $20 and $100. What do you notice about the types of purchases on your two lists? If there are a lot of drinks (e.g. coffee, tea, smoothies), take-out meals, and purchases at a few specific stores, you know where to start watching your spending.
Most credit card bills aren’t made up of big purchases; it’s all the small ones that add up to big debt. Now that you know what your little purchases are, decide what you can change so that you spend less. For a win-win, use the money you save towards paying down debt.
2. Start with one
For change to be successful, starting with small changes increases your chances of long-term success. So start with only one change right now, for instance:
• Take one credit card out of your wallet or remove it from a payment app.
• Pay extra towards one debt.
• Take one item out of your online shopping cart.
• Track your spending for one day.
• Make a meal plan for one day’s meals and snacks.
• Pack your lunch for one day.
• Unsubscribe from one store’s email advertising.
• Talk yourself out of one impulsive purchase.
• Save one dollar.
• For one day, every time you buy a coffee or drink, deposit an equal amount of money into your savings account.
Start today; repeat tomorrow.
3. Be conscious about your consumerism
Have you ever gone on vacation and been surprised by how little you truly need to live a life you enjoy? For anyone who has ever lived out of a suitcase, coming home again and being surrounded by all your “stuff” can not only be stressful, but it also gives you an appreciation for the fact that you can develop the ability to enjoy less.
The concept of “less” is relative; for some people it means adopting a minimalist lifestyle. For most, however, “less” simply means making more room for what matters most. To determine what matters most to you, think about the people in your life — what do you need in order to enjoy and appreciate your time with your loved ones and friends?
Once you determine what matters most to you it becomes much easier to turn away from what matters less and make your spending decisions accordingly. One of the best strategies to consume less is to filter all of your buying decisions through four specific questions:
1. Do I really need it?
2. How will it help me enjoy my time with my loved ones or friends?
3. Can I pay for it with cash or will it become debt on my credit card?
4. What would happen if I don’t buy it?
Starting with your next purchase, ask yourself these questions. Chances are you won’t buy many of the items you’ve chosen. It is perfectly OK to be content with what you already have and it will save you time, money and a heap of stress in the long run.
The bottom line on money-saving tips you can’t afford to ignore
When you repeat a mistake more than once or twice, it becomes a decision. If you think you’ve made mistakes with your spending choices, do whatever it takes to break your bad habits. Avoid social media if it encourages you to compare yourself to others or to focus on your shortcomings. Text your partner, phone a friend, or download an app with inspiring quotes to distract yourself from buying something you really don’t want to spend money on. Rather than worrying about creating a life that looks good on the outside, focus on doing what makes you feel good on the inside.
Scott Hannah is president of the Credit Counselling Society, a non-profit organization. For more information about managing your money or debt, contact Scott by email , check www.nomoredebts.org or call 1-888-527-8999.
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