7 Easy Ways to Cut down Your Monthly Living Costs
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Alt-tag: A person calculating household costs next to a notepad and $50 bills
According to statistics, when you combine the debt of all USA households, you would get approximately $14.6 trillion. If you try stacking this amount of money in one-dollar bills, you would probably reach the moon’s surface. That sounds terrifying! So, something must be done about it. But, what? What can one do to bring that debt back to the earth? Well, the easiest, the hardest, and the only way is to cut down on your living expenses and use the money you saved to pay off that debt. We know that doing that is easier said than done, but we still have to try. And that will be our topic of the day. That is, today, we will talk about 7 easy ways to cut down your monthly living costs! Thus, if this is something you are in desperate need of, keep on reading.
1. Track Your Spending Habits
First things first, one of the most effective ways to cut down your monthly living costs is to start tracking your spending habits. So, write down your expenses. And write them down for two or three months. That will give you an insight into how much money you spend on your bills, groceries, subscriptions, shopping, etc. Some expenses, like bills, you won’t be able to lower. But, others, such as your monthly subscription magazines that teach you how to prepare your home for spring or your monthly subscriptions to Kindle or Netflix can be lowered substantially. Once you see how much money you are spending on something rather irrelevant, it will be easier for you to stop paying for it.
Caption: Write down your sending habits, and you will see where your money is going.
Alt-tag: A woman writing in her notebook.
2. Set a Monthly Budget
The next thing you will have to do in order to cut down on your spending is set a budget. Many people avoid doing this because it seems complicated. But, it is not! Making a budget is basically making a spending plan. You should separate the costs of your needs (bills, groceries, etc.), wants (different subscriptions, shopping, etc.), and goals (how much money you want to save). It is important to stick to this budget plan as much as possible. Of course, there will be times when you will have to spend more than you planned for that month, but don’t let that stop you from continuing to work on your ultimate goal.
3. Move to a Smaller Home to Cut down Your Monthly Living Costs
Once you have seen where your money goes, and once you have made your budget, it may seem that there is no (or just a little) money left. This is because you have too many things to pay for every month. In most cases, those things are related to your big home. So, ask yourself—do I really need to live in a home as big as this? By moving into a smaller home, you will be able to save a ton of money! For instance, all of your bills will be lower, the amount of money you will spend on household items will be lower, etc.
Moreover, when doing this, you will also be able to earn some money (from selling your big home and some extra items you had in it), the money you can use to pay off some debt you have. And, don’t worry about moving—professional movers can provide you with all the help you need.
Caption: Moving to a smaller home can be a great way to cut down your monthly living costs. Alt-tag: A woman packing boxes for moving.
4. Or, Move to a Cheaper Area
Maybe, the reason for your big expenses is not your big home. Maybe it is the neighborhood or city you are living in. Of course, moving to a cheaper city may not be practical because of your job, your children’s schools, your family, etc. But, moving to a different neighborhood is a different story. For instance, if you lived in the city center (where you paid almost $2,000 for your rent), you could consider moving to the suburbs (where you would pay no more than $1,000). We know that making a change as big as this is not going to be easy. However, still, it is a must if you want to cut down your monthly living costs and use your money for something more important than your rent and bills.
5. Consolidate Your Debt
According to Fairfax Transfer and Storage, moving to a smaller home and moving to a cheaper area can be done either with the help of professionals or completely by yourself. But, certain things, such as consolidating your debt, must be done by a professional financial advisor. This kind of advisor will take a look at all of your debts and all the interested rates you pay for them and assess your financial situation. Then, together, you will consolidate your debt—that is, you will combine all your debts into one. This will lower your interest rate by up to 16% or more! And, we all know what a lower interest rate means—a smaller amount of money to pay each month.
Caption: Be sure to go to your bank and talk about consolidating your debt.
Alt-tag: A financial advisor at a desk with a calculator and a laptop
6. Stop Buying Things
We live in the age of consumerism and materialism. Whether we want it or not, this era constantly forces us to keep buying things—things we usually don’t even need. But, you have to find a way out of it. That is, in order to cut your monthly expenses, you have to stop buying things. Don’t buy that jacket, don’t buy that plant, don’t buy that fixer-upper home you set your eyes on. You can buy all of these once you are free of your debt and once your expenses are substantially lower.
7. Cook Your Own Meals
And, last but certainly not least way to cut down your monthly living costs is to cook your own meals. Believe it or not, if you eat out every day, you spend approximately 40% of your income on meals. Not only is this too expensive, but it is also too unhealthy. So, try to get rid of this habit. Limit yourself to eating out only once a week and start cooking your own meals. Doing this will be hard in the beginning, but after some time, you will learn to love it. You will love cooking the same way you will love your saved money and your healthier body.
Meta Description: There are many ways to cut down your monthly living costs. Keep reading as we will mention the 7 most effective ones.
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