6 min readPublished On: June 9, 2023By

Let’s be honest — many of us could be saving more money and cutting down on unnecessary spending. By saving more, you’ll be able to increase the amount of money you can put into long-term investments and you’ll also be able to create an emergency fund that will allow you to navigate unexpected situations like a medical emergency or your car breaking down.

12 ways to save money and live better

Here’s 12 simple ways you can save money, improve your long-term financial prospects and have enough money on the side to weather any emergency that comes up in your life.

1. Create a budget

Start by assessing your income and expenses to create a monthly budget. This will help you track your spending and identify areas where you can cut back. Simply writing down what you’re spending your money on will make a huge difference and will give you valuable insights on where you could save money without impacting your lifestyle significantly.

2. Cut unnecessary expenses

Review your expenses and identify items or services you can live without. Consider canceling unused subscriptions, reducing dining out, or finding cheaper alternatives for certain purchases. If you make a list of all the subscriptions you’re paying for on a monthly basis, you’ll likely find out that you’re paying for services you barely use or need.

3. Reduce housing costs

Look for opportunities to reduce housing expenses. This could include downsizing to a smaller home, getting a roommate to split rent, refinancing your mortgage to lower interest rates, or exploring cheaper housing options in your area. 

Reducing housing costs can be one of the most effective ways to save money. However, it can also have a very big impact on your lifestyle, so you need to consider any decision related to housing carefully.

4. Automate savings 

Set up an automatic transfer from your checking account to a savings account. This way, you’ll save money consistently without having to think about it. Treat savings as a regular expense in your budget. After a longer period of time, you’ll be surprised at how much you saved up without even thinking about it.

5. Cook at home

Eating out can be expensive. Try cooking meals at home instead. Plan your meals in advance, buy groceries in bulk, and bring homemade lunches to work. This can save a significant amount of money over time. In addition, you’ll improve your cooking skills as you go along, which your partner and friends will surely appreciate. Who knows, cooking might just become one of your favorite hobbies!

6. Utilize free resources

Take advantage of free resources available in your community. This could include borrowing books from the library, attending free local events, utilizing free online courses, or accessing free fitness facilities. For example, instead of paying for an expensive gym membership, you could pick up body weight training, which you can perform in public spaces or at home with some relatively inexpensive equipment.

7. Cut down on entertainment costs

This tip is similar to the previous tip we mentioned. Instead of going out for entertainment, find low-cost or free activities. This could include movie nights at home, picnics in the park, exploring nature trails, or taking advantage of community events. If you enjoy gaming, there’s plenty of high-quality titles available for free or very cheap on platforms like Steam and Epic Games. You’d be surprised by how much you can have by spending very little or nothing at all.

8. Use cashback and rewards programs

Take advantage of cashback and rewards programs offered by credit cards and retailers. Earn points or cashback on your purchases and redeem them for discounts or future savings. This won’t result in huge savings, but could add up to significant amounts when combined with other tips we’ve mentioned in this article.

9. Track and eliminate impulse purchases

Be mindful of your spending habits. Keep a record of impulse purchases and analyze them at the end of the month. By identifying patterns, you can take steps to avoid unnecessary spending in the future. A good way to avoid impulse purchases is to use a shopping list whenever you go to the store. By strictly sticking to your shopping list, you’ll avoid making unnecessary purchases.

10. Shop smart

Before making a purchase, compare prices online and in-store to find the best deals. Use coupons, wait for sales, and consider buying in bulk for frequently used items to save money in the long run. In addition, consider replacing brand-name products with cheaper products of a similar or equivalent quality. You’d be surprised at the premium you have to pay on items from a big brand just because of the name.

11. Buy used items and learn DIY and repair skills

Consider purchasing used items instead of buying new. Many items such as furniture, electronics, and even clothing can be found in good condition at a fraction of the price. The savings you can achieve by buying used items instead of brand new ones can be huge.

12. Reduce transportation costs

Consider carpooling, using public transportation, biking, or walking whenever possible. These alternatives can save money on gas, parking fees, and vehicle maintenance. If you need a car, consider buying a used one or exploring car-sharing services as more cost-effective options.

The 50 / 30 / 20 rule

There’s a popular approach to budgeting called the 50 / 30 / 20 rule. By implementing this simple rule, you could make significant savings over time and have enough cash on hand to cover any emergencies. The 50 / 30 / 20 is a straightforward formula for managing your income. Here’s how it breaks down:

Allocate 50% of your income to essentials

According to the 50 / 30 / 20 rule, about 50% of your income should cover the absolute essentials such as housing, groceries, health insurance and utility bills. If you have to allocate more than 50% of your income to essentials, consider if there’s any changes you could make to your lifestyle to bring your spending on essentials to 50%.

Allocate 30% of your income to non-essentials

Non-essentials are things that you can categorize as “wants”. You should aim to spend no more than 30% of your income on things are not absolutely necessary for you to get by. This segment includes things like hobbies, subscriptions, dining, non-essential clothing, cinema, concerts and so on.

Allocate 20% of your income to savings

Aim to use about 20% of your income for savings and investments. You can also automate transfers from your checking account to a savings account.

You should have an emergency fund that will allow you to cover expenses for between three to six months even if you’re completely cut from your income sources. If you already have an emergency fund of sufficient size, the next step is to focus on saving for retirement or other major financial goals. For example, you could make investments in the stock markets or repay debts.

The bottom line

As we have hopefully demonstrated in our article, there’s plenty of ways to save money and improve your life. You will eliminate a lot of stress from your life if you have enough money on the side to weather any unexpected events. 

Just by taking an active approach to saving and critically thinking about how you’re spending your money, you can save a significant amount of money without impacting your lifestyle too much. Of course, if you want to make major savings, you’ll have to live a little less comfortably by cutting out on expenses like dining out and cooking at home instead. 
You can also make significant savings by choosing the right credit card with solid perks and cashback rewards.

About the Author: Dave N. Clarke

Dave N. Clarke
Dave N. Clarke is a writer specializing in new financial technologies. Dave is most interested in the latest advancements in cryptocurrency and blockchain technology, but also occasionally covers traditional markets.

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