It seems that no matter how much we earn, our expenditure quickly rises in line with our new income. As we go through life, we acquire new possessions, become liable for new debts or monthly payments and need to find ways to fund life events such as moving into our own place, getting married, having children, buying a home or maybe just taking that vacation of a lifetime. We look at how you can cut your monthly expenses and release some of your hard-earned dollars to pay for some of the more pleasurable things in your life.
Create a Budget…And Stick to It
Before you can assess where to make cuts in your monthly expenses you need to understand how much you have coming in and exactly where it is going. Listing your income and outgoings in a spreadsheet is one way to do this. Whether all your income comes from one job or from multiple gigs, be sure to list your post-tax income in your budget. Next, list all your monthly expenses from rent or mortgage, student loan payments, food and utilities to entertainment, clothes, and other incidental expenses. By learning how your expenses add up in comparison to your income, you’ll be able to decide where you can save.
Now it’s time to make a realistic budget that ensures you’re paying all the important things but still gives you a little leeway for fun spends too. Your budget must be one that you can stick with. It’s no good having a fantastic budget on paper if you’re not following it. Every couple of months update and evaluate your budget and see if any further changes are necessary.
Many of us are guilty of setting up subscriptions to all kinds of services and products. Maybe it’s cable or TV subscriptions. Perhaps it’s a monthly box of goodies or an online magazine that you never read. Go through your bank statement right now and see whether you can cut down your expenditure by unsubscribing.
Adjust Your Thermostat
It’s a simple bit of advice but a good one. We often have our homes too warm in the winter or too chilled in the summer. Just by adjusting your thermostat by a degree or two, you can save tens of dollars per month. If your heating is not on a timer, be sure to drop the thermostat at night by 10-15 degrees and not only will you enjoy smaller heating bills, but you’ll sleep better too.
Refinance Your Student Loans
Many graduates find that student loan repayments take up a large proportion of their monthly budget. If you’re struggling to pay your loans back, you may want to consider refinancing student loans to reduce your monthly payments. Some private lenders will offer refinancing options that enable you to transfer your existing loans into a new loan with better terms and a lower rate of interest. However, be aware that if you do refinance federal student loans you may lose out on benefits such as federal loan forgiveness.
Learn to Negotiate
Although prices appear to be set in stone, it’s often possible to negotiate a better deal whether that’s with your internet and cell phone provider or your gym. Therefore, honing your negotiation skills could result in savings on services and more. Be sure to do some research to find the best rate, and then ask your provider to match it.