How I Save Big Money Each Month by Cutting Back Small Things

Saving hundreds of dollars every month starts with making small cut-backs that save pennies and dollars. Success in personal finance means keeping more of your monthly take-home income available for necessities and things that improve your life.

When our family real estate business took a hit with the bad US economy a year or two ago, we were forced to cut back on expenses and do whatever possible to lower our overhead. I made small cut-backs here and there, saving a few dollars or even pennies, but when added up, those cuts freed up hundreds of dollars a month for essentials, like food, mortgage and savings.

Here are some easy tips that can help you save hundreds of dollars each month:

Cut out the coffee run
Your daily Starbucks stop probably costs about $7 a day, after tip. Just cutting out daily coffee stops can save hundreds of dollars a month. All gourmet coffee brands (including Starbucks) can be bought in grocery stores, stock up, and brew your own at home and at the office. The best coffee can be made with fresh grounds, microwaved spring water and a simple single-cup gravity coffee maker. Save even more money by buying the coffee (and other groceries) in bulk, online from amazon.com, where you get free shipping and pay no state sales tax. I buy all our chips, soups, toiletries anything that doesn't need to be cold or fresh, from amazon.com.

Tune up and clean up your car
With gas prices beyond $4 a gallon in the US, this is another key area to save money every month. An out of tune car wastes a lot of fuel. Check your owners manual for tire inflation pressures and make sure all four tires are at the correct pressure, check them a few times a week as over or under-inflated tires waste gas. After the car is tuned up, clean it out. Weight costs you fuel, even cleaning out a small box worth of junk can save a lot of gas. Clothes, books, trash, sports gear, they are all weight that costs you gas mileage. The only things in the trunk should be an emergency kit and a spare tire.

Eat at home
A Subway $5 footlong sandwich, along with chips and a drink is $7. For $10, you can get a week's worth of cold cuts and bread, and make them at home. If you don't eat out at work all week, you can buy high quality, gourmet foods to prepare at home, still saving money each month.

Cut back or cut out the cable (or satellite)
Look at your monthly bill, how much are you paying for channels you never watch? How much is that HD service, the DVR, the digital box rental. Many bills now approach $100 a month, which is a waste. After paring down the bill, check into alternatives. If you have cable, look at satellite, and vice-versa. Or consider cutting out cable and satellite altogether, read my article How We Cut The Cord and Now Enjoy (Almost) Free TV for specific tips on how to drop cable, use Netflix, Hulu and on-air HDTV as a replacement.

Cut back the cell phone
Review your monthly bill and the features and services you are paying for. If you have an unlimited plan, review your actual minute usage to see if you can downgrade to a cheaper package offering a specific number of minutes. If you send a lot of text messages, check into an unlimited plan instead of paying per message. Families should review family plans to compare to individual accounts.

I use my phone for business and have a G1 Android phone with T-mobile service. I pay $49.99 a month for unlimited calls and texts, plus $29.99 for unlimited web and email. With taxes and all the other little charges it comes to $85 a month, for unlimited everything. It shocks me when I hear of people paying $200 or $300 a month. Check with the other phone companies, let them know you are shopping around as many have special discounts to attract competitor's customers and make switching easy.

Shop around for Internet service
Many different carriers offer Internet service. You can get it from AT & T or Verizon and other telcoms, but you can also get it from your local cable provider. Satellite services also offer Internet access. Shop around for the best rate, let other carriers know you are not yet a customer and shopping around. Prices vary greatly, for example here in Los Angeles, I get AT & T service under a promotion offering its Uverse Pro (6 meg download) service for $19.99 a month.

Shop around for car insurance
Call your current provider, tell them you're not happy and see what they can do. Review your policy to see if you are paying for unnecessary coverage. We were paying $100 a year for towing service, which we already had free through our AAA membership. Another wasted expense eliminated. Review your deductibles, if you have a $100 deductible for comprehensive and collision coverage, raising it to $500 or $1000 may greatly reduce your premiums. Check with other companies, many offer fast, free on-line quotes for easy comparison to your current policy. Your auto policy can be canceled at any time if you want to switch coverage, if you pre-paid, the company will refund the unused balance.

Cut electrical use
Electricity is expensive. We were using fans, air cleaners along with several electronic components that run constantly. We had a Tivo unit along with a cable box with a DVR. Since eliminating both, our electrical bill has dropped almost 30%, as both were plugged in and powered-on 24 hours a day. Look into changing bulbs to low energy fluorescents and also look into automated light switches that turn off if no one is in the room.


All these are very basic tips that can save you a few dollars here and there, but will add up even the first month. I've managed to cut our monthly expenses by several hundred dollars and constantly look for ways to make my income go further.


More from this contributor:

"Getting Good Credit, Keeping Good Credit"

"Repair That Computer or Replace It?"

"How To Prevent Identity Theft"