There are many times when you feel things are going well. You make plenty of money, you are living well within your means, and you are saving enough. However, there are always ways that you can save even more, and ways that you can start to drastically increase your net worth. Because we are human, we have certain psychological limitations on the way that we think. While being frugal and saving money should be easy, logically it makes complete sense, the majority of Americans do not do it. In order to help you get in the habit of saving more, take one month to be a money miser. Every day for the next 30 days, employ these tactics to see your net worth grow. For the next few weeks I will share five tips, some of them can be compounded on each other, some are one-time savings. By the end of your Miser for a Month, you should have a pretty good grasp on how easy it is to save money.
While eating out with co-workers on occasion is a great way to do some workplace bonding, it is also a great way to drain your pocket book. The average lunch is around $10, not including the tip. If you eat out all 5 days per week, you are spending over $50, just on food. This equates to roughly $200 per month. If you pack your own lunch you can eat for much cheaper. For instance, I leave a loaf of bread, a jar of peanut butter, and a jar of jelly at work. Each Monday I bring five apples, and a bag of potato chips. I calculate my week’s worth of lunches costs me around $7. This equates to a savings of $172 per month.
Turn Down the Thermostat
It is estimated that you will save between 1 and 2% off your heating bill for every degree you turn down the thermostat. This means if you set your thermostat 3 degrees cooler, you will save as much as 6% off your bill. Depending on where you live in the country and how big your house is this can be anywhere from a $6 to $25 per month. Not a huge savings, but will definitely add up.
Carpool to Work
Find 4 other commuters that work near you. Then each one has a designated driving day. The savings on this are hard to quantify since you figure you are saving wear and tear on your vehicle as well as gas and parking fees. In the end, all five of you win on this one, and you can all save as much as a couple hundred dollars over the next month. If you live close (within a few miles) consider riding a bicycle. You will get some exercise and save money.
Does your spending get you in trouble? Try using one of Dave Ramsey’s tricks and freeze your credit card(s) in a block of ice. Without it handy you will be less likely to make those impulse purchases. Other cheap tricks include using only cash for all purchases, shop alone (many people buy less when shopping alone), and always make a grocery list (ok, not so much a cheap trick but just plain good advice).
Make Coffee at Home
For the next month, skip getting your favorite latte, and make your coffee at home. If you don’t have a coffee pot, then drink the coffee at work. Your latte might run you around $4 per cup, that’s $20 per week. Brewing your own at home, especially if you drink it black, can be as cheap as $.40. That is one tenth the cost of getting a fancy drink. If you want to see the math, check out Trent’s blog on the true cost of coffee.
You now have five simple tips that you can use for the rest of the month. It will probably take you less than 2 hours to get everything lined up (a little more if you have trouble tracking down carpool participants), and you can save about $500 in the next 30 days. That means you will be making around $250 per hour by putting these into practice. I would encourage you to keep these ideas going indefinitely, and not just end them after one month. If you do want to test them out for a month, make sure you go for a full month (such as October 10th to November 10th), if you quit after a week you probably won’t realize how much you can save. I will be taking part in being a Miser for a Month, join me in drastically increasing your net worth.