21 tips for how to live frugally and save money – Introduction
If you read the last post on utilising the Dave Ramsey 7 Baby Steps to get debt free you may have reached Step 2 and wondered how do I go about doing that? My 21 life hacks for how to live frugally and save money will hopefully help you out.
In the baby steps approach we looked at collating all the debt you have in your life and ordering them from lowest to highest debt. Then you start attacking it. I’ve compiled 21 quick tips to help you live more frugally and save money. Each of these could have their own posts, maybe they will. Leave me a comment at the bottom of the page and let me know which ones you’d like to know more about.
Depending on your approach to risk and your level of debt some of these may work for you and some may not. The key with any of these lists is to choose what works for you and is something that fits with your life.
So, without further wait lets jump into improving your financial future with our 21 life hacks for how to live frugally and save money. I estimate that these tips could save you up to $12,000 per year, not to mention the money-making tips!
Part One – life hacks for how to live frugally and save money
1. Understand the debt snowball method
Let’s kick things off in our life hacks for how to live frugally and save money list with a big one! As we discussed in the Dave Ramsey’s Top Tips post a debt snowball method is an approach advocated by Dave Ramsey for debt reduction. As we noted above you collate your debts, order them smallest to largest then start paying them off utilising some of the techniques below. I’ve listed this at number one and this may raise eyebrows. The reason I’ve done this is to re-iterate the importance of planning and having a goal.
You focus on paying off the smallest piece of debt, whilst maintaining the minimum payments on the other debt. Utilising your new frugal habits, you throw more money at the debt paying it off super-fast. You then roll that newly available cash into the next debt then so on and so forth until you clearing debt left, right and centre.
Average Savings: Removing interest payments could save $30-$100/month
2. Budget, Budget, Budget
Budgeting is easiest when you use a budgeting app or spreadsheet. My approach to budgeting was first to build up an idea of what I was spending my money on. Every month I would take account of my monthly spending and apportion it into different spend buckets. Once I had a view of my monthly spending, I was able to see where I was spending excessively and assign a budget to it. This works really well with number 15 in the list.
There are a number of budgeting apps you can use as well including:
- YNAB
- Money Dashboard
- Mint
- Emma
- And many more
For me, I’m a spreadsheet junkie. I like the control. To start off I highly recommend the free budgeting spreadsheet from Martin Lewis’ Money Saving Expert. It is available as a spreadsheet or a printable.
Average Savings: Clever budgeting can easily save $200-$300/month
3. Start couponing or using cashback
You might save tons of money by showing coupon to cashier. When you are buying new products then you can use the coupons which are really useful to you. You can do this the traditional way through the papers or bring it up to date and use cashback sites. I made over £1000 in cashback one year. In the UK my favourites are:
For the US the one I am continuously hearing good things about and I am very jealous I can’t join is EBates. This has now been bought by the behemoth Rakuten who have brought with them their significant consumer power. This means there are now even better deals available.
Average Savings: Cashback per year, on average, $200-300
4. Try charity\thrift shopping
Kids. Grow. Quickly. It’s true, they will grow out clothes at the speed of light, so it is not always worth going into the debt for your kids’ wardrobe., especially when they are young and don’t really care. Admit it, you are buying the clothes because you like them! I’ve done it too!
For example, with the little TGFI on his way we’ve been checking out the charity shops and have welcomed hand me downs from friends and family. The little munchkin is barely going to wear the clothes. He will be sick and poo all over them too.
We haven’t gone completely frugal. He has some store-bought clothes including his first football (soccer our North American friends) kit/baby grow! All the clothes and other gear we’ve snapped up are cleaned in store and to be on the safe side given another clean when we get them home too.
For adults to it is amazing what you can find especially if you visit shops in more affluent areas. There is everything you’d expect to find in your normal store from amazing furniture to music, games and designer clothes.
Average Savings: Easily savings of upwards of $1,000 per year – this is a huge one on our life hacks for how to live frugally and save money
5. Cut the cable
Cutting the cable is one of the best and most effective strategies to save money and live more frugally. We cut the cord about 3 years ago now and moved to streaming services at a fraction of the cost we were being charged to watch adverts.
As we are in the UK we still pay our TV license, so we get the BBC iPlayer, but all the standard channels have free services and then we have Netflix and Amazon as we have prime anyway. There are always other routes as well such as IPTV.
In my opinion, getting rid of cable TV is one of the best tips on our life hacks for how to live frugally and save money list because there are so many better options available to you.
Average Savings: Based on UK figure’s savings of $1,000 per year
6. Stop going out to eat
Whilst I love eating out it was a very quick way to cut costs especially when you combine this with number 8. You might say, well I can’t cook. To that I’d say go on youtube check out a few videos it is pretty easy. Don’t worry about getting things spot on with measures. Experiment a bit, have some fun.
I personally love cooking as it takes me away from the stresses of work. You don’t need to be able to do anything fancy, but some simple tips will help you go a long way:
- Some pasta, a sauce and veg and/or some meat will taste lovely. You can buy your sauce in a jar or grab some plum or chopped tomatoes and add spices
- If cooking in a pan, cook the veg (peppers, onions, mushrooms, baby sweetcorn, etc) that you don’t want to eat raw and crunchy first and add your meat (if eating meat) later. That way your vegetables will soften.
- Add sauces, herbs & spices to provide additional flavour
- Be careful with that knife!!
- Keep learning
- Without a doubt get the Sistema microwave steamer – steamed veg in minutes. This is my number one hack in the kitchen!
- Number two hack in the kitchen is the unbelievably handy InstaPot Duo. Chuck the food in and SAFELY pressure cook in half the time to get fall apart food. You can even use it for deserts, it’s that versatile. I love it!
Average Savings: Eating in can save you anything from $30 to $250 per month!
If you are enjoying our 20 tips for how to live frugally and save money remember to drop me a comment at the bottom. Please feel free to add your own tips!!
7. Break up with your barista
Not really one for me as I don’t drink coffee, but it’s staggering how much people spend on daily coffees. I don’t get it. If you don’t know where your money is going each month, then cutting the coffee shop may be very surprising. Brewing your coffee at home is one of the simplest ways to save money. Invest in a Nespresso machine if you really have to. It will still be cheaper.
Average Savings: With that two coffee’s a day working habit gone you could save $1,500 a year
8. Visit the library
There are tons of movies and books which you can check out for free so you no need to spend money. It is also just a worthwhile thing to do to support your local library. Supporting your local library is a fantastic thing to do as well. It’s also great to get the kids involved with as well.
Average Savings: Harder to quantify, but I’d expect savings of $100 per year
9. Plan your grocery trips
Try to make a list and stick to it. You can use the calculator app on phone to make sure that stick for your budget. Ordering online can be a great way to make sure you keep on top of the expenditure rather than waiting until you get to the till to pay.
An added benefit of not traipsing around the shop and you can pick it up or get delivered to your door. Most stores offer discounts on the first order. Between this and number 1 you will be becoming more and more in control and you can easily save between $100 – $400 pounds over the course of a month, family size depending.
If you are struggling to cut down on your spending sites like $5 meal plan can be extremely helpful. For just $5 a month (with the first two weeks free!) you get meal plans and recipes provided to you along with the exact ingredient you need to add to your shopping list in order to create those meals.
Average Savings: Clever budgeting can easily save $200-$300/month
10. Avoid expensive hobbies
I’ll be careful with this one because hobbies are hugely beneficial and even if they come with an upfront spend they payback in different ways. However, if you are in debt that extortionate golf or yacht club membership might not be needed. If you spend a huge amount on golf then it is considered to be one of the costliest hobbies around. Notable exceptions for me might be to do number 11 and replace it with an exercise hobby like a martial art. Let’s remember we are trying to save money.
Average Savings: Drop those expensive hobbies and save anywhere from $50 – $200 a month
And now a break from your scheduled life hacks for how to live frugally and save money. If you are enjoying this post and my others then take a moment to sign-up to my mailing list and you will be the first to find out about new posts and free giveaways that are coming soon!
Part two – life hacks for how to live frugally and save money
11. Ditch the gym membership or scale it back
I do love the gym, but could I replace it with home exercise? Do you really need that swimming pool? Do you even use it? In the UK the difference between a gym with a pool and other random facilities vs just gym facilities is around £30-£50 ($40-$60) per month! The best decision I’ve made a few years back was changing to a gym only…erm, gym. It costs me £16/month ($20) rather than paying £40-£60 I had previously been paying. It is a good gym as well with free classes, a basketball hoop, and a random table tennis table.
You can go all the other way and simply ditch it completely. Focus on running or home-based bodyweight exercises. An investment in some decent weights is also still a lot cheaper. YouTube is full of amazing workouts for free. Staying fit does not need to kill your budget.
Average Savings: Yearly savings of around $600
12. Find free entertainment
It is advisable to put a spending freeze on your entertainment cost for a while. This means you don’t need to go out to concerts, bowling, movies or whatever you might do for fun which costs money. Challenge yourself to figure out how you can have fun for free and stay entertained. You might take your kids to park, go for a walk or enjoy free concert event in your community, join a walking group or host a boardgames night.
Average Savings: Harder to quantify, but just replacing concerts could save ou $300 a year
13. Start a side gig
Yes, yes, yes. If you love to make new things, then you can sell it online. Are you an animal lover? You might take up pet sitting or dog walking. If you are a good photographer, then you can start taking on clients. Start a blog, Research affiliate marketing, get a drone and become a drone photographer for real estate? I’ll be putting together a detailed list of options in the near future. There are so many options out there to make a quick buck. Some cheaper than others.
Average Savings: Less a saving and more a money maker, but with some focus the sky’s the limit. We will be conservative and go for $100/month, so $1,200 a year
14. Get a part-time job
If you are not starting your own business, then you could consider getting a part-time job. This is a much safer option for guaranteed money in your pocket and maybe what you need to fix those short-term goals and get the debt snowball rolling. Your decisions fall into two camps:
If you want some flexibility with your hours or you are happy working set hours.
The former may see you look at becoming a driver for Uber or Lyft or a delivery driver for Just Eat, Grub Hub, UberEATS, etc. The latter could be a Pizza delivery job, barista, barman or anything else really to bring extra money. It seems simple, but many forget this option in their life hacks for how to live frugally and save money.
Average Savings: Another money making tip. Dependent on how many hours you have to invest, but US national averages come in at around $1,200 – $2,000 per month.
15. Cut up your credit cards
You might never get out of the debt until you stop using credit cards. Get rid of those store cards. At least until you are back on the right track. Having a credit card as a backup can be helpful for emergency situations, but not if you just put everything on it. An exception to this is big-ticket items as credit cards do have more protection against things going wrong with a purchase. Once you are in control of your finances credit cards and their benefits can be one way to pull in some benefits.
Average Savings: Cut those monthly interest payments. $20-30 per month
16. Use the envelope system
We love Dave Ramsey over here at Tall Guy FI and that’s why he features again on the life hacks for how to live frugally and save money. If you pay with the cash then you might feel that money leaving your hands. But nobody likes that. Whilst we use a lot of cards these days the envelope system for cash is still a really good way to monitor finances and it can be applied digitally too.
The basic premise is you set up your budget with categories that you will be spending money on. Determine the amount of budget you will spend on each – see number 2. Get some envelopes and fill them with cash for each budget area (or allocate a fund to your digital envelope). Now spend only what you allocate to the budget envelopes. The key here is monitoring your spending and only spending on what you need or have accounted for. A key focus for life hacks for how to live frugally and save money, accountability.
Now, if you’ve been super good this month you might even have money left in the envelopes that you can use for savings, investments or paying off debt!
Average Savings: Covered under budgets and groceries. This is more money management
17. Listen to Dave Ramsey show
Here is the man again! I might have well called it the Dave Ramsey life hacks for how to live frugally and save money. Listening to the show might encourage you to save money and get rid of debt. Dave is a real help to millions of people around the world when it comes to creating a plan for money management. Dave’s success might inspire you for keeping moving forward.
I also highly recommend the UK’s Money Saving Expert. Martin Lewis has the number one UK site for everything money-related, but a lot of it is also applicable to a global audience. Martin is frequently on TV and the radio helping people out. He is an absolute legend.
These guys are like a one-stop-shop for everything around life hacks for how to live frugally and save money.
Average Savings: FREE financial education! Priceless!
18. Sell items on the Facebook Marketplace, eBay or Craigslist
One person’s trash is considered as another person’s treasure. This doesn’t have to be a side hustle that you do continuously, but a fantastic way to make cash quickly is to sell to online marketplaces. Excavate that wardrobe for cloths, exercise products or your children’s old toys. Do you use that golf club set? It may make you quite a bit of money.
Average Savings: Not necessarily every month so a yearly average of $300-500
19. Say no to drugs, I mean that new car
The average new car will have a residual value of around 40% of its new price after three years (assuming 10,000 miles/year) or in other words will have lost around 60% of its value at an average of 20% per year.
theaa.com
As soon as a new car drives off the forecourt you start losing money on it. A general rule to live by is if it appreciates in value then buy it. If it depreciates in value then rent it. At the moment, I lease my car. I get a better car for a lower monthly payment. However, I feel that I have control over my finances now. That said, my next purchase will be looking at buying second hand and owning it for the long-term to reduce my monthly costs.
Average Savings: Easily save $10,000 over the life of the deal.
20. Stop Smoking
Seriously, just stop. Without being a bit preachy and judgemental. It’s bad for you and the people around you. The balance estimates that in the US people are spending over $2,000 per year on smokes. That’s crazy.
The NHS (god love it) estimates in the UK that it is slightly lower at £1,500 ($1,700-1,800) a year, but a lot of that is dependent on exchange rates. In the scheme of life hacks for how to live frugally and save money this is a major winner because it’s two-fold. Save your money and save your life. Winner winner chicken dinner.
Average Savings: $2,000 per year
21. Negotiate your contracts
We all have some sort or auto-renewing contract or a contract that finishes a special rate then switches to the standard rate. When this happens we are losing out on money and likely additional benefits. We “set and forget” because we’ve justified the spent value in our minds, but we can do better!
Insurances can be a huge one where we “set and forget”. The best idea is to try a comparison website to see what you could be paying.
For cell/mobile phones call up your provider and ask them if they can give you a better deal. If not say you would like to be put through to cancellations and see if they can do you a better deal. If they can’t, you are under no obligation to still cancel. Tell them you will need to think about it. Then try a day later. It can be very dependent on the customer representative you speak to. This also works well on cable providers and broadband/internet companies too. Give it a go!
Average Savings: Combined $400-$500 per year
Wrap up – life hacks for how to live frugally and save money
I hope you’ve found some of these life hacks for how to live frugally and save money useful. Leave me a comment below and let me know which ones work for you and which ones don’t.
They may not all apply to you, but I am sure some of the life hacks for how to live frugally and save money will. Even if you feel you are in a good financial position there are still good tips in there for living a more frugal lifestyle or that will help to accelerate your savings and investments.
If you’ve enjoyed the post make sure you drop me a comment below and pin the picture please!
