- Nearly one-third of Americans plan to make a money-centric New Year’s Resolution for 2019.
- Adopting a “happiness allocation” instead of creating a budget could make a big difference when it comes to saving money.
- Being prepared is key to using your time wisely and avoiding shopping temptations.
- Spending less on coffee and water can add up.
Making a New Year’s resolution might feel like an arbitrary trend that doesn’t work, but there are ways to make resolutions that stick. Putting in an effort to develop solid habits will help you follow through with your goals – even after the excitement of the new year has worn off.
Looking to focus on your financial future this year? If so, you’re not alone. A recent Fidelity Investments survey shows that nearly one-third of Americans intend to make a money-centric resolution for 2019, with 15% hoping to spend less and 48% of people planning to save more.
Read on for 10 smart ways to reach your goal by spending less and saving more money each month.
Stop spending so much money on coffee and water.
Small sippable expenses – such as getting coffee when you’re out or buying bottled water each day- will add up quickly. Just think: Buying a $US4 coffee and $US2 bottle of water five times per week will cost $US120 per month.
Megan Terzian, an associate financial advisor from Mosaic Partners, suggests checking in with yourself to evaluate daily expenditures. “Do you really need that coffee every day? Probably not,” she told INSIDER. “Don’t feel anxious about doing this exercise. The purpose is to give you clarity and control of a financial foundation.”
Further, according to a Vanguard Blog for Advisors post by Frank Kinniry, “By pocketing the $US3.50 for coffee each day and investing it instead in a low-cost, diversified Roth IRA, you’d have an estimated $US106,000 after 30 years,” writes Kinniry. “I don’t think anyone would pay $US106,000 for coffee!”
A similar scenario plays out when it comes to spending money on bottled water. Instead, investing in a sustainable water bottle will keep your drinks cold and hot for extended periods of time, wherever you are, making it easier than ever to save.
Design a capsule wardrobe or uniform.
Having a closet full of clothes that don’t fit, are hard to pair together, or wear out quickly can cost you money; in fact, it might be the reason you keep shopping for new stuff.
Break the bad habit by resolving to establish a uniform that suits you, your lifestyle, and frame, or by creating a capsule wardrobe with a few timeless, high-quality items you’ll wear again and again.
Rent the Runway Unlimited could be a cost-effective way to incorporate trend pieces at a fixed monthly cost without aimless spending at fast fashion stores.
Cancel the subscriptions you don’t use.
Though this one may seem like a no-brainer, auto-pay subscriptions you’ve had for a long time can linger in the background, affecting your bank account.
Be intentional about checking your bank and credit card statements to figure out exactly how much you’re spending each month subscriptions you enjoy at home or at work. Gym memberships, streaming services, apps, old domains, email products, software, and boxes are all ripe for cancellation.
Not sure when you should cancel? This handy chart will help.
Put your commuter benefits to work.
Does your company offer commuter benefits? If so, spending your pre-tax dollars on your commute can save you heaps of cash. Commuter Benefits estimates you may even be able to cut your commuting costs by a whopping 40%.
Use your benefits if you take public transportation to work or use a ridesharing service like Lyft or Uber to get to work. You can also use your benefits on parking expenses.
Use your time wisely.
Ever heard the old adage “time is money?” It might be stressful to think about, but the heart of the sentiment rings true. Failing to be productive can cost you each month in missed opportunities. Allowing yourself to be idle may also make completing a task take much longer than it needed to, leaving you with less time to spend on other important (and perhaps billable) matters.
There are a few solid ways to work toward using your time more wisely this year. Get a good grasp on how long a task takes, plan in advance, and work toward measurable outcomes. Learn how to stay focused and optimise the time you do have. These tactics will save you time and help you spend less while earning more money.
Exercise more — for free.
Spending money on a personal trainer or a workout program might help you feel motivated but spending on fitness isn’t the only way to break a sweat. This year, challenge yourself to move more when spending less.
To start, add more natural movement to your day. Try taking the stairs instead of the elevator, spend a couple of days at week at the office’s standing desk, and walk to or home from work.
Make social plans that don’t revolve around food or drink. Grab a friend and take a walk, plan a group hike, and look for free outdoor fun, like ice skating, roller blading, or boating.
Celebrity trainer Harley Pasternak previously told INSIDER, that when it comes to getting fit, what happens outside the gym is actually the most important. “You get lean in life and strong in the gym.” He said, “The gym is when you can strengthen, tone, tighten muscles. But if there’s fat covering those muscles, no one will ever seen them. And that’s what’s happening outside of the gym.”
Create (and stick with) a happiness allocation.
Creating and sticking with a budget might feel like a burden, so flip the script to use a happiness allocation instead. Finance pro Ashley Feinstein Gerstley told Brit + Co that making the mindset change might be all you need to save more money each month.
“Budgets are created around the idea of not’ purchasing things, so when we’re on a budget we say things like, ‘I’d love to go out to dinner with you, but I’m on a budget’. The budget is the enemy, keeping us from doing and having the things that we want, much like a restrictive diet,” she explained.
She went on to share, “A happiness allocation is what I call a financial plan because I believe it’s a much more fitting term. The whole point of having money is to have and experience what we want in life and that will look different for each of us. A happiness allocation is just an honest look at what’s going in and what’s going out so we can allocate our money in the ways that are going to make us the happiest in both the short and long term.”
Escape the online sale temptation in your email.
Merely scanning your inbox can be a slippery slope if you have an online shopping habit. Nowadays, updates about promotions and sales can suck just about anybody in.
To combat this temptation, Libby Kane at Business Insider swears by using email filters. After applying a filter to all promotional emails, “They immediately get filtered into a shopping folder (I call it “Shopping,” but you might go with “Stay out of here” or “You don’t need any of this”), where they wait for me to realise I need a new white t-shirt or something to hang in my hallway.”
Resolve to stop “pressure spending”.
Gerstley also previously clued INSIDER in on a phenomenon she called “pressure spending.” Examples include shopping out of guilt, overpaying for friends, or chipping in on a group present that’s beyond your budget.
“We think ‘I should buy another round of drinks because we’ve been holding the table for so long’ or ‘the sales person was so helpful, I should really buy something,'” she said. “It sounds silly, but many of us do this.”
Stop pressure spending by resolving to issue a heartfelt thank you or do something in return for someone the next time an opportunity presents itself.
Tap into a loyalty program.
Loyalty programs and apps might seem like a hassle but they can really help you save money each month. Drink lots of coffee? Downloading an app you scan each time you buy a cup; major chains like Starbucks have them, and it doesn’t take long to reap the rewards.
Airline loyalty programs can also help you cut costs if you travel often for work or personal vacations. Top programs, make it easy to earn miles you can redeem on future flights.
Don’t underestimate the power of credit card points either; some cards offer 2x or 3x points in certain spending categories. Swipe the same card each time while paying for an item covered by a loyalty program as a legitimate way to enjoy extra rewards. You can redeem your points as cash back on your statement, on travel, or on gift cards.
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