Sometimes in order to speed up the process to reach your goals you have to take extreme cost-cutting measures – but we’re not talking about living like an Extreme Cheapskate! These changes are not for everyone, but if you can implement one or all of these ideas into your life, then you can shift thousands of extra dollars toward your goals.
Here are some extreme cost cutting measures:
Moving from an expensive place to a more affordable home can save you a significant amount of money. If you rent, then this step is easier than if you own – but if you live in a house that is too big for your needs or in an area that is too expensive for you, then you are a good candidate for this extreme cost-cutting measure. A few of my clients made a move after they became aware that over 50% of their take-home pay went toward housing expenses. By moving they were able to save about $500/month. The inconvenience and expense of moving is offset by the thousands of dollars each year they were able to put toward their goals!
2) Buy Another Car
Another area where people tend to spend above their means is on their car. If you own a gas guzzler and you drive long distances often, then switching to a more fuel-efficient car could pay for that new car in gas savings alone! If you own a luxury car that is consuming a big chunk of your budget, then trading down to a nice, yet more affordable car, that still gets your from point A to point B could make a big difference for you. This change can be tough (especially for us guys!), but if it is the difference between paying off your debt or being able to buy that house, then this could be worth considering.
3) Change Your Cell Phone Plan
This is an area where I usually find savings for my clients. Cell phone plans have changed quite a bit the last year, so if you haven’t reviewed your plan recently, then you are probably paying too much. Also, double-check your data usage to ensure you have the right data plan. More often than not, people tend to pay for more data than they need.
4) Drop Cable TV
If you are a big sports fan, this idea probably won’t work for you. If not, then read on! Cutting cable TV can easily save you over $1,000/year. My wife and I recently completely eliminated cable TV (we first went to basic cable for a year) because we realized that we were only watching Netflix. If you find that you don’t watch that much TV and you are fine with using Netflix and Hulu to watch your shows, then this is a no brainer for you. If you do want the basic channels, an HD antenna may be a good option for you depending on where you live. At the very least, review your cable bill and take a realistic look at what you’re paying for, and how much of it you really need – you could save some money by dropping premium channels or eliminating that cable box in your guest room.
5) Stop Having Fun
Just kidding! You should definitely have fun in life. Many people can save hundreds of dollars per month by either eating out less often or more strategically. Some of my clients have cut their dining out and entertainment in half without too much sacrifice. This can be done by eating during happy hour or going to a fast casual restaurant (think Chipotle or Panera) instead of a sit-down restaurant (go there for special occasions!). You could also cut out alcohol or limit the amount of alcohol you buy at a restaurant to further reduce your spending in this area. The most affordable option would be to always get water. If you give yourself a cash budget (allowance) for dining out and entertainment at the beginning of the month (and you stick to it!), you will see an increase in the money you have left over at the end of the month.
So these are some extreme (yet doable) cost-cutting measures that you can implement to fund your goals. What extreme cost-cutting measures have you taken? Please share them with us in the comments section below.
- Published in Spend Wisely