How to Reduce Personal Spending

12
April

A recent survey revealed that an overwhelming majority of consumers that stated they were having a hard time saving money really did not have an accurate understanding of the true amount of money spent on a number of different areas. Individuals can quite easily burn themselves out trying to work more overtime or pick up a part-time job, and the simple fact of the matter is that it may just be necessary to make a few minor changes and reduce personal spending. Before a person decides that drastic measures may be in order, it’s much easier to just learn a few tips on how to reduce personal spending.

The first and most important step to reducing expenditures is to actually figure out exactly how much money is being spent on certain items. There are obviously going to be fixed expenses, such as rent and other normal obligations, but the largest amount of money normally goes to food, gas, and optional benefits or services. The 30 day method is relatively simple and requires consumers to either keep all of their receipts or jot down every single purchase that is made in one month. The results are probably going to amaze the consumer as nobody really understands exactly how expensive meals on the run and coffee can be.

After determining where the majority of a person’s income is being spent, the next step is to decide which areas need to be reduced or eliminated. If money is being spent on coffee every single morning, it is a little extreme for a person to completely avoid their local coffee shop. However, cutting back the visits to a couple times a week could save as much as $500-600 a year or more. Taking a bag lunch to work a couple days a week is another excellent way to save $1000 a year or more. These small expenditures certainly add up and it is advisable to see which ones can be decreased without causing stress or angst.

While a person may not be willing to simply give up their cable or internet package, it is often possible to save money by selecting lesser options. One high speed internet cable provider recently announced that they would be offering several different speed options that would all have a different price. Most of their clients selected the fastest one because they believed it would be significantly better than the lower packages. The real surprise came when independent tests revealed that all three options basically delivered the same download and upload times and choosing the lowest package would have saved over $20 a month. Paying a significant amount to have all of the possible movie channels may not be the best way to spend money, and it can often be reduced without making any major lifestyle changes.

Entertainment expenses are another major category that often ruin a person’s budget, and no financial planner is going to suggest that their clients simply stay at home and save their money. However, it is important to note that there are plenty of hobbies and activities that exist that may either be less expensive or may not actually cost anything at all. Individuals should take advantage of the opportunities that they have in their area and limit the more costly events to special occasions. If a person was willing to dine out at a restaurant one less time per month, they could easily save $400-500 a year.

Using coupons can help decrease the amount of money that is being spent on food, clothing, and other necessary items. Instead of limiting the purchases or trying to use less, discounts and sales can help obtain the same products at lower prices. Buying in bulk may also be suitable for certain items and can result in lower costs.

Saving money may seem like a difficult feat to many people, but reducing personal spending does not necessarily mean that major lifestyle changes are going to be required. In fact, most of the money saving tips found above are relatively simple to incorporate into any financial strategy and will not cause a negative impact to a consumer. Realistic savings goals can easily be met by carefully reviewing the current expenses and making minor changes here and there.

This post was written by

jason – who has written posts on Budget Clowns.
Father of three and married to a lovely women. Always looking for ways to save money, and invest it properly for my children's future.

Email  • Google + • Twitter

Comments are closed.