Add More to Your Savings This Year
Six tips to spend less to build up your bottom line
In 2012, I wrote the book “Money Rules: The Simple Path to Lifelong Security.” It contains guidance that still holds true today: You can fix any financial mistake by saving more.
That also means you can stop beating yourself up for money lapses you may have made in the past. It’s time to forgive yourself and start fresh when it comes to your finances.
I understand that saving money can be challenging when inflation is still high and you feel as though your budget can’t stretch another inch. But consider this: When it comes to saving more money, it basically boils down to two concepts: spend less or earn more. And yes, I know that it’s easier said than done on both counts.
Where Does Your Money Go?
In general, you probably know you spend money on necessities such as rent, or a mortgage, utilities, transportation, healthcare, and food. Through my work helping people with money makeovers, I’ve noticed patterns emerge. If someone doesn’t already have a budget, they often have no idea where their paychecks go every month. Time and again, when I work with individuals and families, and they go back and track their expenses for the previous month, something often becomes clear. They are spending much more than they expected on many things — but food and subscriptions tend to be particular culprits.
Do Some Digging
Take a look back at your own financial documents. Really dig in. Go line by line through last month’s credit card bills, your checking account statements, and even your digital wallets. If this sounds like something you’d like help with, my Finance Fixx coaching program may be just the ticket. We’ve got new sessions starting monthly.
Here are six specific ways to save more money in 2023:
1. Car insurance
Annoying commercials aside, you really can save money by changing car insurance companies every year or so. Make it easy on yourself. Go online and compare prices for similar plans. Use a site such as compare.com to make your comparison shopping that much more convenient. Experts say you don’t need to wait until your renewal period to do this.
Figure out how to cook for the number of people in your family. Americans send nearly 146 million tons of food to landfills every year, according to the EPA – in part because of all the leftovers we end up throwing out. How can you get better at this? Right after a meal, portion the leftovers into individual servings and store them in the fridge to have for lunch (or dinner) the next day. Pro-tip: Soups and stews also freeze well for future meals.
If you own your home, consider challenging your property tax bill. The National Taxpayers Union estimates that between 30% and 60% of property in the U.S. is over assessed, which means you could be paying too much. Unfortunately, fewer than 5% of us challenge those taxes each year. You can do this yourself, or hire an attorney, who will typically take one-third of what you save as a fee for doing the work.
Shop around for your medications. Why? Because not every pharmacy charges the same price for the same drugs – even generics. You can use comparison tools such as GoodRx, SingleCare and RxSaver to see how much drug stores in your area charge for certain drugs. Another way to save is buying 90-day supplies of some drugs to lower the price.
Increase your retirement plan contribution by at least 1%. Your contributions are tax deductible, which means they lower the amount of income you’re taxed on.
If you drive to work or take children to school, consider carpooling on both fronts. Your neighbors are likely in the same boat as you when it comes to wanting to save more money. And if you live in a larger city, make it a habit to skip taxis and Ubers whenever possible and opt for walking when running errands.
Content by Savvy Money