This topic is intended to make life better and more enjoyable for anyone with any disposable income. I do not believe I can offer much assistance for someone truly living day to day. I also have no intention of providing investment advice. However, these simple tips may make life a little bit easier and are not typically considered by those of us that were brought up in our consumerist culture. I have had a bit more contact with people that were not born here and may be able to give a different outlook.
First, I am not about to tell you to scrimp and save every dollar. What I will tell you is that the important part is to be able to spend the dollars you have on that which you truly enjoy. To that end, I will offer tips for reducing the normal day to day expenses that don’t provide much enjoyment anyway.
To begin, pick the things that are most important to you. If having a shoe collection that rivals Imelda Marcos is your thing, go for it. For me, it is all about wildlife viewing and photography. I want to have the necessary funds to buy the minimum required camera equipment that will get the job done, which in my case is still quite pricey. I also want excellent binoculars. And, I want to have money to go to places with wildlife.
So, these are the things on which I do not scrimp. I try not to buy more than I need. However, I still want good equipment. I also try to save money on travel, when possible, but sometimes end up spending a lot to get to where the wildlife is. Getting away from people is expensive.
OK, so what changes can be made day to day? These are the little things that really add up precisely because they are your most regular purchases. For me, I found that I was paying more for a land phone line and slow modem than I am currently paying for a cable modem. So, since the bulk of my phone usage was dial up access to the internet, I dropped the land line and got a cable modem and kept my cell phone, which I need. This saved money and improved quality of life by providing better internet access.
Here’s another one. I was paying $60/month + tax for standard cable. Now I pay $30 for basic cable, have a lot fewer channels, but added netflix at $15/month. So, now I get to see more of the movies I actually want to see, instead of seeing whatever is on, and I get to save $15/month. I also save money by not having a video store membership anymore.
I know it doesn’t sound like much.
We were supporting American Automobile Association, a.k.a. the devil. I’ll write a post about them another time. However, we switched to Better World Club. The price is the same. But, every quarter, they give us $10 for gasoline. We send in a receipt with a coupon and get a check. It’s $40/yr. I’ll take it. And, unlike AAA, they lobby for me not against me. Again, that’s another post.
Here’s a good tip I heard on the news one morning. Go through your home, every closet, every drawer, every storage area, basement, garage, etc. Take out everything you haven’t used in a year and make a pile of these items. (The news suggested 6 months. Some things are seasonal. IMHO, a year is better.) The pile you end up with is things you don’t need.
Look carefully at these items. How many of them are in nearly new condition, i.e. have been used once or just a few times? These are things you never needed. I can’t get you your money back on them. However, when you are about to purchase something new, imagine whether it will end up in this pile. If so, how soon? That soon?! Then put it back. You don’t need it.
Think of other little things. Do you have a Starbucks coffee every morning? Starbucks is a great company. They are one of the model corporate citizens. However, do you really need a $4 cup of coffee every morning? That’s $1000/yr just for the work days.
Further, by not consuming more than you really need on a daily basis, you will dramatically reduce your footprint on the planet. When we say that China has now surpassed the U.S. in carbon emissions, just remember what they are doing that emits all that carbon, mostly it’s making stuff to feed our consumerism.
This type of attitude when applied to everything in your daily life may make you mildly neurotic at first, until it becomes second nature. However, it will leave you more money for whatever it is that you find really important, whether that be a trip to Vegas or Disney or simply a few more bucks for your retirement.
[Edited 9/29 @ 21:30 EDT]
Of course, I forgot the most obvious thing. Save on energy bills. CFLs save money every month. Heating to 68F in winter and cooling to 78-80F in summer will save quite a bit on oil/gas/electric. Adding some attic insulation, if applicable will help tremendously.
Also, definitely make every effort to get the best interest rates on any debt you have. Credit card interest rates, other than special offers, are insane. Do not use revolving credit.