Living frugally is not easy. It entails curbing your shopping desires and wants for more extended periods.
Only saving money on big-ticket items is essential, but that alone is not going to make you rich.
The satisfaction you get from savings is fleeting because it is a hard pill to swallow. The joy you get from spending that saved money is eternal.
Spending your savings to go on a holiday will bring everlasting joy. The critical point to remember is that saving money is not something that you do for a day and see the results right away.
It takes time for the savings to accumulate into a handsome amount. Once you have achieved your saving goal, you can use those finances to invest in assets.
The exchange value of these assets can increase as time progresses.
1. Reform Your Money Mindset
Changing your mindset regarding money is one of the most potent strategies to help you achieve maximum savings.
To achieve maximum savings, you need to modify your mindset about spending. Modern consumers have come up with the term ‘No Spend Challenge.’ It sounds crazy, yeah! Agonizing!
Why would anyone do something like that to themselves? The bottom line is that the savings you can achieve are massive.
Let me begin by saying this is much easier to achieve when you are dealing with financial pressure after trauma.
Depression, in most people, does not trigger any illogical emotions to purchase random items in on the spur moments.
Determine how much you want to save. Decide for how long you can manage to keep up with the ‘No Buy Challenge.’ Establish what is going to be your motivation during the entire period. Then start saving.
2. Cutting Major Expenses First
For single women, the two most costly expenses are housing and transportation. For single women, living with a family is one of the most favorable situations in terms of expenditures.
If you do not have to pay anything for room and board, you are one lucky single woman. If this is not the case, there are specific steps, which can be taken to lower housing expenses.
a. How to Save on Accommodation Expenses?
Each one of these solutions has its advantages and disadvantages. Just as each damsel is unique. Their living situation is also one of a kind.
- Moving into a smaller house\apartment\accommodation
- Moving in with your nuclear family
- Moving to a less expensive city
- Sharing the rent with a roommate or roommates
When considering each one of these solutions, think about suitable long-term situations. Do not be hasty and make emotional decisions.
b. How to Save on Transportation Expenses?
Some of these adjustments might seem difficult in the beginning. However, considering long-term savings, each one of these suggestions will seem justified.
- Use public transportation
- Walking or biking shorter distances
- Maintain your vehicle to get the best fuel economy
Applying these techniques will allow you to identify significant savings over a more extended period.
3. Limit Unnecessary Expenses
Smoking, drinks, and entertainment costs are all included in unnecessary expenses. You can live comfortably without these items.
None of these items is adding any fundamental value in your life. There are many purchases we make, which are a spur of the moment purchases. As Zig Ziglar observed, “People don’t buy for logical reasons, they buy for emotional reasons.”
The list of emotional purchases goes on to include clothing, movies, take-out meals, beauty products, and much more. “I realized I was purchasing so many beauty products just because my emotions were being played by advertising with the latest trends” are the words of Mary Roberts from Crowd Writer.
Do not buy expensive products just because you have the money in your pocket at that time. Put off purchasing extravagant items for at least a day, in some cases, even a week.
Think about the quality in terms of the price of the product. Does the cost justify the quality of the product and the need?
4. Keeping Track of Financial Resources
Everyone needs to keep track of his or her net income and monthly expenses.
Monitoring cash flow involves keeping track of when and how much money is coming in and when and how much money is going out.
Keeping track of your financial resources is one of the reasons to use accounting software to help you get organized.
Get all the information from your bank accounts. Get all the data from your bills. Try to categorize your expenses and income. Try to get everything organized.
Create separate files for each significant expenditure. Create a separate file for each bank account and credit card. Do not let anything get by you in terms of your expenses or income.
This exercise will help you make better financial decisions. It will help you identify where you need to make savings, where you should be spending less.
5. Negotiating Contracts for Better Rates
Just because a company advertises that this is their rate, you might think that this is non-negotiable. Most of these companies rarely advertise their lowest price.
A select few customers secure the most affordable rate, not because others cannot. They only get that rate because they bother to negotiate with their provider.
The providers, which administer cheaper rates if you haggle with them, are cellular, internet, cable, home insurance, and car insurance providers. All of these providers are monthly expenses.
Cutting costs will make for significant savings.
The following are best practices, which can be used to negotiate cheaper contracts.
- If you build a reputation at work, you can check with your employer for employee discounts.
- Negotiate at least two months before the end of your contract.
- Talk to the customer loyalty or customer retention department to make sure that they are authorized to give you better rates.
- Review your existing provider’s most current promotions.
- Refer to competitor’s prices to increase your chances of getting a better deal.
Take some time out of your busy schedule to negotiate with your providers. Remember that even over six months, this will translate into a substantial amount of savings.
6. Strategically Plan Out Meals
The best way to make savings is to prepare your meals at home instead of eating out. Cooking at home might seem straightforward enough.
Nevertheless, if you do not do this right, there is a chance of you spending more at home instead of making savings. That is why you need to plan this strategically.
Decide what you like to eat. Make a shopping list and stick to it. Keep in mind viability when deciding your preferences. Never shop in a convenience store when you are hungry. Go shopping only once a week. Shopping every day is binging, not shopping. Go shopping alone. Do not take a friend or anybody else shopping with you.
7. Buying Branded Clothes or Generic Clothes
Clothes are always going to be on sale on one outlet or another. Even designers hold clearance sales and seasonal sales.
Remember that the advertised product is most likely going to be the latest product of that brand. The most advertised product is also going to be the most expensive product of that brand.
When buying clothes, do not hesitate to take your time and examine the entire inventory before making a purchase.
Clothes, which are not sold for a more extended period, are often sold at marked down rates. Try purchasing generic brands instead of branded items to increase your savings.
8. Generating Secondary Income Sources
According to the Bureau of Labor Statistics, the unemployment rate as of April 2019 in the US is between 2.2% to 6.5%. In other words, a majority of the people in the United States are employed.
The amount you can save depends on two things. The first factor is the amount of money you make each month. The second factor is the total amount you spend each month.
To increase your ability to save more money, you need to increase your income. There is only so much savings, you can achieve by being prudent and frugal.
If you can increase your monthly income, it will automatically multiply your savings.
Think of getting a part-time job in your free time. You can do some jobs online. There are other jobs, which you need to show up physically, to receive compensation.
Determine what sort of employment will be most feasible in your situation and start saving more money.
9. Set Up Periodical Automatic Savings
Financial experts have recommended this technique for so many years. Personal finance experts suggest thinking of yourself as a bill, which is paid each month.
As soon as you get your income, designate a specific amount monthly to be your savings. Make sure that this amount does not conflict with the payment of your actual bills. Think of it as a bill, which needs to be paid.
The most straightforward way to do this is to set up an automatic debit from your current account to your savings account. The initial amount does not have to be a significant amount.
You can commit yourself not to spend that money until you reach a specific amount. The sooner you reach that amount, the sooner you can spend that money.
10. Reduce Liabilities and Build Assets
The salary you get from a job is not going to increase every day. On the other hand, utility bills are going to escalate every day.
Know how much you are paying on each one of your utility bills. Try to cut costs by getting rid of unnecessary utilities, which you rarely use. Sell stuff, which you hardly use online.
The mindset you need to have purchasing items is that you need to build on your assets. Property and stocks are some of the best options to increase your assets.
Purchasing a new car is not such a good idea. The value of the new vehicle will only depreciate as time passes by. When you try to sell that car, you might not even get half of the amount you paid to purchase it.