Today’s blog post is an awesome guest post from Dawn from Fi and Wine. Her article is all about the things she changed in her life to save over $860 each month, which is an insane savings and shows you how easily you can save tons of money. I hope you enjoy it and be sure to check out her website!
About a year ago I came to the realization that, while I wasn’t in financial crisis mode anymore, and all my debts had been paid off, I was still somehow living paycheck-to-paycheck. And I wondered how in the world this could be.
I felt like I was doing everything right. I was earning more money, I was careful about my spending, I even had a budget. So, what was I doing wrong?
I decided it was time to carefully review my finances and figure out how to start saving more money. So, I looked up my bank and credit card statements and went through my spending, item-by-item, for the previous three months. What I learned was shocking.
In reviewing all of my spending over a three month period, I realized just how much those “little things” add up. A small expense here, another medium expense there, they all add up to a depleted bank account. There was a clear reason I wasn’t saving any money. I was over-spending on a lifestyle I simply didn’t need, and frankly, couldn’t afford.
Over the next few months I experimented and learned how to cut certain expenses out of my life and how to spend less on what I wasn’t willing to give up. It turns out that a change in just a few simple habits was life changing.
While I wouldn’t go so far as to claim that I’m now frugal, or that I am willing to embrace the frugal lifestyle just yet, these 7 habits have allowed me to save an extra $860 per month. And I have to admit, I’m hooked. I bet I can find some additional habits that could use the frugal touch.
Before we get started, can you do both me and Dawn a favour and share this post on Pinterest? We’d greatly appreciate it!
7 Habits I Changed to Save $860 a Month
1. I Fired My Hair Stylist
My “personal care” expense category was the first glaring over-expense I noticed as I was reviewing my spending. I was surprised to see the grand total of what I was paying my hairstylist to touch-up my roots every 3-4 weeks and maintain my highlights and style.
The problem was that I didn’t know any other viable alternative. I was not willing to switch to drugstore “box” color and I was absolutely not willing to start sporting the prematurely grey look. I also couldn’t imagine firing my hairstylist, who was like a friend, therapist and spa esthetician all in one. Wouldn’t she be lonely, hurt and despondent without my monthly visits?
But, I did some research and analyzed my options. I found a professional hair color service (Madison Reed) that was highly reviewed and automatically ships high-quality product directly to your door, on your schedule. They also provided color specialists that helped me determine which color to choose, which helped lessen my stress and fear in switching products and color.
For just $27 every 7 weeks (I only need ½ bottle every 3.5 weeks), and the freedom to dye my hair at home without working around my and my stylists full schedules, I realized this was a big win. As it turns out, the color is even better than it was before. I was able to pick a darker color because I have the freedom to perform my root touch-ups as soon as needed rather than waiting for availability at the salon.
The good news, I didn’t even have to fully fire my stylist. She still sees me twice a year for my haircuts, and while I felt like I was breaking up with significant other, she has assured me that she doesn’t take it personally.
Total monthly savings: $80
2. I Fired My House Cleaner
About a year ago I had carpal tunnel surgery. I knew I wouldn’t be able to clean my house for a few weeks. I’m the kind of person that gets stressed out and overwhelmed when my house gets too cluttered and disorganized. So, following the helpful suggestion of many friends and colleagues, I hired a house cleaner.
It was amazing. I had a team that came in and did a thorough deep-clean from top to bottom. It was like I had just moved in. I was afraid to ever go in my son’s stinky boy bathroom, but after the cleaners, even I would have used that bathtub.
Since I could afford the cleaners, and it was a huge help to have them, I didn’t see an issue with maintaining the service. My neighbors, and most of my friends, also had house cleaners that came twice a month. I assumed I was being thrifty by just signing up for service once a month.
But the fact was, by about three months post surgery, I really didn’t need them anymore. I realized that it was more important that I be able to save money, so, I fired my house cleaner.
Total monthly savings: $150
3. Changed How I Grocery Shop
My original budget for food was around $800 a month. Little by little, I fell into the habit of grocery shopping about three times a week and eating out about four times a week. This is for just me and my 12 year old son.
Clearly, it was time to overhaul my “food” expense category. I tend to plan dinner on a whim, shopping for what I need on my way home from work. The problem with this is at the end of the day, I just want to be home. I’m tired and already hungry. Then, I want to buy everything that looks good and I come home with more groceries than I really need. And I throw out what I didn’t get around to consuming.
Now, I shop once a week and use my store’s phone app, which tracks what is on sale. It keeps track of what I usually buy and provides quick suggestions based on my past purchases. I plan my meals around what is actually on sale and add the items to my build in shopping list. Then I go in, grab what’s on the list, and then I get out.
I save between 15%-25% by using the store app. Then, I save by not overbuying items I don’t need. I save on time and gas by only taking one trip to the store a week. Since I’ve done some advance planning and I’m more aware of what I already have at home, I rarely eat out. And, I don’t waste nearly as much food as before.
Total monthly savings: $400
4. Changed Where I Bought my Clothes
I will admit it. I like clothes. And shoes. This is an area where I am just not frugal by nature. To make things worse, I really like the well made, cute, designer clothes. I also get really bored with a small wardrobe. I like to mix things up and change my overall look often. So, I have a lot of clothes and shoes. Which is just hell on a budget.
Introducing my best clothing discovery ever: ThreadUp.com. ThreadUp is like a glorified online thrift store. Only so much better. They offer new and used designer and quality women’s and children’s clothes and shoes. I found that all my favorite brands were covered and I could find the prices that worked for me.
I now save time and fuel by only shopping online, and I’m able to easily return what doesn’t work out. Then, when I’m tired of what I have in my closet and want to add something new, I send in my old clothes for credit on my new finds.
I now think of shopping for nice clothing the way I think about shopping for a new car. There’s just no reason to buy brand new. If it’s well made, it’s just as good after a few wearings as it was off the rack.
Total average monthly savings: $75
5. No More Target Therapy
As a single parent with a young child, shopping at Target was my weekly (or even more frequent) therapy. It became my “me” time. My son was entertained and enjoyed looking at all the toys and electronics. I roamed the aisles and imagined up ways to beautify my home, update my gym wardrobe and then grocery shop, all in one visit.
The snack aisle alone was worthy of the weekly visit.
I fell into the habit of buying things, bringing them home and realizing I didn’t need them, then returning them on the next visit, with the perfect excuse to go right back to roaming the aisles for more great things that I didn’t need. And then pretending that since I had store credit from my last visit, I wasn’t really spending much additional money.
But the sad fact was, I was spending so much more than I realized. For stuff I just didn’t need. Additionally, I was spending money on gas driving back and forth from my house to Target, and I was wasting valuable time that I could apply towards better quality family time or earning money from home.
It took me a few months, but I managed to wean myself of my Target habit. And I haven’t looked back.
Total average monthly savings: $80
6. I Gave Up Amazon for 3 Months
Another area where I realized I was consistently spending a little here and there throughout the month was by making random Amazon purchases. It’s just so convenient to have Amazon prime and free shipping!
Once I gave up my Target habit, I realized I was replacing it with an Amazon habit. Practically every few days I’d have a new package at the door. When I took the time to think about why this was, I realized that every time I was bored, I’d pull up my Amazon app on my phone or browse the website on my computer. It wasn’t because I specifically needed something.
I vowed to break this habit by deleting the app and committing to a three month Amazon ban. If there was a household item I needed, I made a game out of searching for the cheapest sale price for that item between my grocery store or my drug store. Both have weekly sales. This game became fun and now I only ever buy something if it I need it and it’s on sale.
Total average monthly savings: $50
7. Started Doing DIY Pedicures
Before I reviewed my finances, I was in the habit of enjoying a nice spa pedicure every six weeks. This was a necessary expense for me. I have the unfortunate condition of developing ingrown toenails, and after years of dealing with this painful condition, I finally found an esthetician that was amazingly skilled at keeping my poor toes pain free. So, it seemed like an absolute necessity for me.
However, after I reviewed my finances and started searching for ways to cut back on my spending and save more money, it became harder and harder for me to justify this $35 expense every few weeks. So, I started paying attention to what she was able to do that I just couldn’t seem to manage on my own. I carefully watched how she was trimming my nails, what tools she was using, and asked her to explain the process for me.
Then, I bought everything I needed on Amazon (after my three month ban, of course!). For exactly the price of one pedicure, I purchased all the tools and nail polish I would need in order to accomplish the exact same thing that my esthetician was doing for me. With a little practice, I discovered that I was just as capable as she was. It simply took the right tools.
Now, similar to dying my own hair, I have complete flexibility in when I do my own pedicure, and as soon as I start feeling pain, I can fix it before it gets any worse. Double win.
Total monthly savings: $25
After the simple, and not-so-time-consuming process, of tracking my monthly expenses, I was able to highlight areas of over spending. Then, I was able to find and change some of my worst spending habits. The result was significant, an amazing $860/month that I’m now able to save.
Rather than living paycheck-to-paycheck, I’m now automatically transferring $430 per paycheck so that I don’t even notice the extra money. This way, I don’t feel tempted to spend simply because I see extra money in my checking account.
Additionally, I opened a high-interest savings account with Marcus. My savings is automatically transferred from my checking to my online savings and I earn 3% interest. This way, I can expect to save $10,500 every year. If this is all I do, with compounding interest, in five years I’ll have saved over $55,700.
Finally, I have an emergency savings fund that I can count on. Soon enough, I’ll have more than I need for emergency savings and I will then funnel the extra into an investment account so that I can build wealth.
And that is something worth changing some bad spending habits for.