Saving money helps protect your financial situation in an uncertain economic environment. It also allows you to better grow your financial status because you have more money to invest in growing your wealth. By using strategic money-saving tactics in the long term, you can start saving for an earlier retirement or other lifestyle change.
With numerous tools and plans out there, getting started with a savings strategy can feel overwhelming. Have no fear. Here are seven simple but effective ways to save more money in 2022.
1. Track Your Income and Budget Expenses
If you weren’t doing so in 2021, it’s time to track your monthly income and expenses in 2021. First, look through your account statements and write down how much income you brought in for the month. Then, categorize your expenses. Personal finance tracking and goal-setting tools can help you create these categories, then it tracks and sorts them by category automatically. Some examples are Mint, Personal Capital, Moneydance, Wally, MoneyPatrol and PocketSmith. They can help you see where the bulk of your money is going through its tracking and analysis capabilities.
2. Cut Costs on Repeating Expenses
Take a look at each of your expenses and ask yourself how you can cut down on spending. You can shop around for cheaper car insurance, for example. You might choose a cheaper Internet plan or cancel your Netflix subscription to save a little extra each month. See where there’s room for change in the amount you drive, so you can reduce your gas spendings. Continue going through each of your expenses to decide what can go and what’s essential.
3. Save Energy at Home
A key way to save money every month is to be smart about your energy usage at home. There are some switches you can make to reduce your home’s daily energy expenditure. For example, switch your light bulbs to light-emitting diode (LED) light bulbs, which use a small fraction of the energy conventional bulbs expend. Also, switching to a tankless water heater and making sure your home is airtight and weatherproofed can help you save monthly.
4. Avoid Eating Out
Eating out can be an addictive pleasure, and it’s convenient, too. However, it costs a whole lot more than putting together your own meals. If you don’t like your own cooking, learn how to improve it! Restaurant food generally uses lower quality ingredients to cut costs, and it’s less healthy (hence, the addictive taste). If eating out or ordering in is one of your expenses, find ways to pack your own lunch, make new recipes or whatever you need to stop the costly habit.
5. Negotiate on Big Ticket Items
If you plan on buying a big ticket item, such as a used car or a house, you should always settle on a negotiated price instead of giving the seller their full price. Make your counter-offer politely, but remain confident. Remember the salesperson’s goal is to get you to pay as much as possible, so you need to try and pay as little as possible. A great negotiator is ready to walk away. If you can’t get a seller to budge, you truly should move onto the next option so you can negotiate a better deal.
6. Plan Your Meals
Meal planning saves you time and money. It can help you curb the expensive habit of ordering in or running through a drive through for a meal. When planning your meals out, you’re able to do so with your money in mind. Knowing ahead of time what you’re going to eat makes shopping lists and trips easy and it saves you time wondering what to eat. Rather than grocery shopping or ordering food haphazardly, you can start with a budget and put together a meal plan that fits within it.
How do you create a meal plan? Start by listing out the meals you or your family enjoy. Get the recipes so you can write down all the ingredients you’ll need for the next week or two weeks, depending on how far out you’re planning. You can even plan for the month. Compare your list of ingredients against what you already have in your kitchen to create a shopping list. Double check you’re within your budget. Now you can get shopping done in bulk, saving time and money.
7. Shop at Cheaper Stores and Buy in Bulk
Speaking of buying in bulk, you should choose stores like Costco, Walmart and Amazon, which let you order large amounts of an item in bulk. You can do this for your personal care needs, such as for soaps and shampoos. However, you can also buy food and drinks in bulk, and have them delivered to your door. By shopping online for everyday items in bulk, you can compare costs at different stores to easily find the best bargains.
If you need to purchase technology such as a laptop or phone this year, try and save by buying an “open box” item at a discount. These are gadgets that have typically been used for less than 30 days or so before being returned.
Growing Your Savings Account in 2021
Saving money comes down to big financial decisions as well as your everyday habits. With some changes in the way you plan and spend in 2022, you can save more money than you might think. Tracking your spending, cutting costs and energy usage, buying in bulk and planning your meals are all ways to help you reduce costs and grow your savings account.
