This post isn't so much about earning more money as it is about making the money you already get go further. As far as your bank account is concerned, spending a hundred dollars less a month is the same as making a hundred dollars more, and for many people saving extra money every month is actually rather simple. The very first thing you need to do is map out your current expenses. Just how much do you spend in a given month, and what do you spend it on? This does not have to be a difficult challenge, either. Many programs and websites exist for this very purpose, and my personal favorite is http://www.mint.com With mint you simply add all of your bank, loan, and credit card accounts and it will automatically keep track of your transactions. You can then set budgets indicating how much you want to spend in a given month on a particular type of transaction such as groceries, fast food, movies, or clothing.
An important thing to note is that not every family is the same, and some things that are easy for me to spend less on may be impossible for you. Here are a few of the specific things that it may be possible to save some extra money on every month:
Auto/Home Insurance
Check around for quotes on auto and home insurance and see just how much you may be able to save. In my case, I used to pay $116.50 every month to insure one car and my apartment. When we added a second car, I started looking at other quotes. By switching companies we now pay $120.98 every month. Adding that second car to my original policy would have cost just over $150 a month, a savings of $30 every month and it required very little work on my part. Use caution, however. Make sure that you compare exact levels of coverage. We found one company that could insure both cars and the apartment for $70 a month, but the coverage was less and reviews online were not positive. Find a company that will save you money, but find a company that you trust.
Gas/Tolls
Commutes are often not negotiable, but there are a few tricks to save you some money. There are of course minor tweaks such as driving 55, using cruise control, keeping your tire pressure at the recommended levels, etc. that can increase your mileage, but there are also times when it may be prudent to consider trading in your current vehicle. I had an SUV that got 17 MPG and commuted 280 miles every week. Every week this car would go through 17 gallons of gas, at current prices this would cost about $70 every week. By trading in my SUV for a new sedan I spent about $17,000, but with my current mileage I only spend about $25 a week, a difference of $2500 a year. It will take close to 7 years before I will actually make back the cost of the car in gas money, but after that I will have a car that is worth more than my old SUV, and costing me less in gas.
You can also get creative when it comes to picking your route. This is not possible for everybody, but by taking a few back roads I can skip the first toll booth on my commute. If I were paying cash, it would cost $0.80 every time I went through the toll, but since I have an I-Pass it only costs $0.40. Working five days a week, commuting to and from work, skipping this toll saves between $4 and $8 every week, and it only costs me an extra two minutes on my commute. If you drive through tolls often, investing in an I-Pass, EZ-Pass, or other electronic tolling device is often a great benefit. In Illinois you pay half of the toll price if you use an I-Pass or EZ-Pass.
If at all possible, walking, biking, or taking public transportation can also be an excellent way to save a little money.
Restaurants/Groceries
Everybody has to eat, and everybody enjoys going out so I am not going to even bother suggesting that you always eat ten cent ramen or toast at home to save a few bucks. There are, however, a few things you can change to still enjoy a night out while saving for a budget. One thing I would suggest is setting a specific amount you are willing to spend every month on restaurants. That will help you determine if you want to go to two really nice fine dining establishments, or five chain restaurants. Before you order, think, will you really eat an appetizer and the full entree? Most times the bread and a salad or side dish is enough until the entree comes, and skipping an appetizer can save you $10-15 every time you go out.
If you get a soda instead of a beer or a mixed drink, you can save an extra $5-10 per person, and getting a glass of ice water instead of soda saves an additional $2 each. You can always have a drink at home for much cheaper. My favorite scotch typically costs $8 for a shot at a restaurant, or I can buy a whole bottle for $35. By doing this, I am saving hundreds of dollars without missing out on the food or restaurants that I love.
Comparison Shop
As a general rule of thumb, always comparison shop. With the ease of shopping online you can quickly find out what stores are currently having sales or who has the best price for an item you want to buy. An added benefit of comparison shopping is it forces you to take your time with the decision. Impulse purchases are a danger to every budget, but by taking time out to compare prices, you have the chance to calm down and decide if the item is even worth purchasing.
By keeping an eye on your budget and making a few small changes you can effectively increase your available income several hundred dollars every month. This money can then go into stocks and bonds, a retirement account, a savings account, or a certificate of deposit and then earn interest, effectively giving you even more free money every month.
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