Wouldn’t it be nice if money grew on trees? Although you’ll never find dollar bills sprouting from your favorite oak tree, you can uncover money in other places. By spending some time dissecting your spending habits and scrutinizing your expenses, you could free up money in your budget and save big – up to $5,000 in a year.
If you haven’t had success in cutting costs and saving money in the past, chances are you haven’t been looking in the right places. Follow these expert-backed tips to save on everything from monthly bills to annual subscriptions, and get on your way to saving thousands of dollars this year.
> Adjust your temperature setting.
> Unplug unused gadgets.
> Increase your insurance deductible.
> Nix that unused gym membership.
> Trim your subscription services.
> Cut back on takeout.
> Reduce food waste.
> Cut commuting costs by carpooling.
> Switch to a free banking account.
> Organize a parent babysitting co-op.
> Go to the movies midweek.
Adjust Your Temperature Setting
The average energy bill in the U.S. costs $117.65 per month, with heating and cooling accounting for 43% of this cost, according to the Energy Information Administration. Meanwhile, the Department of Energy says you can save as much as 10% a year on your energy bill by turning your thermostat back by 7 to 10 degrees for eight hours a day from its normal setting.
Potential savings: $141 per year.
Unplug Unused Gadgets
Turning off an electronic doesn’t mean it’s completely shut down. Commonly referred to as “energy vampires,” many devices continue drawing energy even in the off mode when they remain plugged in, says Cisco DeVries, energy expert and CEO at OhmConnect, a clean energy program.
Think: set-top cable boxes, gaming consoles, coffee makers and space heaters. Although each may use a very small amount of energy, collectively and over time, it adds up. According to to the Lawrence Berkeley National Laboratory, a typical American home has 40 products constantly drawing power which amount to almost 10% of residential electricity use.
To stop these energy vampires from wasting power, DeVries suggests using smart plugs or smart power strips. These devices automatically shut off power supply to any gadgets that aren’t in use, he says. By doing this, you can shave approximately 5% off your electricity bill or more.
Potential savings: $71 per year.
Increase Your Insurance Deductible
One quick hack to lowering your annual homeowners insurance or auto insurance premium is to increase the deductible. According to a 2019 study by the National Association of Insurance Commissioners, the national average homeowners insurance premium hovers just above $1,211. This same study found that if you bump your deductible from $500 to $1,000, you’re looking at reducing your bill by as much as 25%. With a higher deductible there’s less risk to the insurer, so they can offer a lower premium.
“Ask your agent how much money you will save if you adjust your deductible and put that savings into an online savings account until the balance reaches the deductible amount,” advises Jim Wang, founder of personal finance blog Wallet Hacks and former U.S. News contributor. This way, you’re covered in the event of a repair, he says.
When it comes to your auto insurance, data pulled by CarInsurance.com estimates that consumers can save nearly $14 per month by increasing their deductible from $250 to $500, or pocket an extra $30 every month by bumping their $250 deductible to$1,000.
Potential savings: $303 a year.
Nix That Unused Gym Membership
If you committed to a gym membership at the beginning of the year as part of your New Year’s resolutions, but you already see your visits dwindling, don’t get stuck paying for something you aren’t using, says Nadia Malik, blogger and owner of personal finance site SpeakingOfCents.com, who recommends canceling your unused membership.
Considering the average monthly cost of a gym membership is $58, and 67% of gym members fail to use their membership, as reported by research site StatisticBrain.com, this is a huge drain on your budget. Although canceling that membership may feel like you’re giving up hope on getting back into shape, there are plenty of free ways you can get fit, Malik advises. You can walk, run or bike ride outside when the weather is nice or opt to follow free workout videos online or use a free fitness app such as Fitbod for strength training and C25K for running, she adds.
Potential savings: $696 per year.
Trim Your Subscription Services
According to the America’s Relationship with Subscription Services research by West Monroe, a national technology consulting firm, U.S. consumers spend an average of $237.33 on subscription services every month. From video streaming to on-demand music to data storage to photo editing apps, such subscription services may seem minimal at first glance but they add up quickly. Spend time reviewing all the services you’re subscribed to and identify where you can cut back.
For instance, if you love listening to audio books while commuting, the audio subscription service Audible is popular. However, Kristal Audain, blogger and founder of personal finance blog NormalisBroke.com, points out that there are free alternatives, making this an unnecessary service to pay for.
“Most libraries now offer Libby by Overdrive, which allows you to check e-books and audiobooks from your computer or smartphone,” Audain says.
At nearly $15 per month, canceling an Audible subscription and using your local library can result in big savings.
Potential savings: $179 per year.
Cut Back on Takeout
The average U.S. household spends $3,459 per year on food away from home, according to the 2018 Consumer Expenditures report from the Bureau of Labor Statistics. By cooking at home and preparing lunches for your family to bring to work or school just 25% of the time, you could save around $288.25. Since many people lean toward takeout when time is limited, cook meals in bulk so you always have leftovers that are easy and quick to reheat.
Meanwhile, Catherine Alford, family finance expert at http://www.CatherineAlford.com, a site dedicated to helping working women make better financial choices for their families, says researching deals at restaurants in your area can reduce the cost of dinner out.
“My local seafood place lets kids eat free on Tuesdays, and our local Mexican restaurant lets kids eat free on Sundays. By knowing the deals available to you throughout the week and the different perks your restaurants offer, you can save as much as 25% per year on restaurant costs,” she says.
Potential savings: $288 per year.
Reduce Food Waste
Food waste isn’t just bad for our environment – it’s bad for our wallets and costs the average American household roughly $1,866 per year, according to a new study from Pennsylvania State University. Cutting down on food waste won’t happen overnight, but a few simple tricks can help you start saving.
Lamar Brabham, CEO and founder of Noel Taylor Agency, a financial services firm in North Myrtle Beach, South Carolina, suggests keeping a running food inventory list in your kitchen that you can quickly reference before heading to the store so you don’t double up on ingredients that could go to waste.
Meanwhile, planning a few weekly meals in advance that use similar ingredients can also keep food waste to a minimum.
Potential savings: $1,866 per year.
Cut Commuting Costs by Carpooling
Consumers often overlook the financial impact of commuting by car to work five days a week, but the expense can be startling when you tally it up. According to the 2015 Citi ThankYou Premier Commuter Index, the average cost of an American commute is $10 per day, which can add up to $2,600 over a year of weekday traveling.
Saving money is possible by carpooling with just one person, which essentially splits your costs in half, says Steve Pilloff, assistant professor of finance at George Mason University’s School of Business.
Finding someone to carpool with may seem tricky, but start by asking co-workers or look for neighbors who travel to a similar area for work. Otherwise, plan a carpool through the popular traffic map app, Waze, which helps connect workers looking to share rides.
Potential savings: $1,300 per year.
Switch to a Free Banking Account
When you’re trying to save money, bank fees can eat away at your efforts. In fact, average checking account charges hover over $9.30, according to ValuePenguin. However, Simon Zhen, a research analyst for financial services comparison site MyBankTracker.com, says there are plenty of free options.
“By switching to a free checking account, such as those often offered by online banks, a consumer can avoid paying any monthly fee,” he says.
Potential savings: $112 per year.
Organize a Parent Babysitting Co-op
Ask any parent and they’ll tell you that babysitting costs add up. Beyond day care while you’re at work, you may need a sitter for a weeknight or weekend. With the average babysitting rate at $16.25 per hour, according to the 2019 Care.com Cost of Care Survey, going out sans kids for four hours once per month will set you back an extra $780 a year in child care.
However, Violette de Ayala, founder and CEO of FemCity, a networking group for professional women, says you can easily save by setting up a babysitting co-op with other parents in your neighborhood or through your children’s school. “It creates an instant play date for the little tikes and saves parents the hourly rate for a sitter,” she says.
Potential savings: $780 per year.
Go to the Movies Midweek
The average movie ticket costs was $9.16 in 2019, according to the National Association of Theatre Owners. For a family of four, catching a new flick on the big screen will cost over $36.64 just on movie tickets, and much more if you add popcorn, candy and soda. If you go to the movies once a month, plan your movie night during the week to save.
Many theaters offer discounts on movie tickets during the week to loyalty members. For example, Regal Cinemas offers Regal Crown Club Value Days at select theater locations where Regal Crown Club members can enjoy movie ticket prices at around 50% off, plus discounts on concessions.
Meanwhile, keeping the kids entertained during the summer doesn’t have to be expensive either, thanks to programs such as Cinemark’s Summer Movie Clubhouse, offering $1 kid-friendly flicks, from May 27 to Sept. 8, 2020.
Potential savings: $220 a year.