We’re all trying to reach our own version of financial independence. Yeah, it can be difficult trying to save up and invest when you don’t have a lot of money to do it. But cutting costs in certain areas can definitely free up some money to help you do just that — SAVE AND INVEST! It’ll help to know where your money is going and where you can afford to cut costs. Below, you’ll find the top tips on how to drastically cut expenses.
How to Drastically Cut Expenses – Your Guide to a Brighter Future
Imagine how much better your financial future would be if you had the funds to make it happen! Well, what if I told you that future is still a possibility?
You have the ability to create something better for yourself. But, first, let’s focus on how we can put more money in your pocket by cutting your expenses drastically – maybe even in half.
Here are the best tips I can think of for how to drastically cut expenses:
One of the biggest expenses for people is their house.
- The mortgage
- Property taxes
- Electric, heat, trash pick-up
It all adds up to a pretty large figure each month.
- On average, people pay $1,500/mo. for their mortgage
- Property tax could be another $400/mo.
- Insurance is another $50/mo.
- And then there’s electric, heat, and trash…let’s call that $200 a month
And that totals…. $2,150 a month for housing.
That’s a LOT of MOOLAH!
What if you could change that? What if you could pay less than the average?
How to Drastically Cut Expenses with Your House
- What’s the size of your house right now? 2,500 square feet? More?
- How many spare rooms do you have?
- Do you have a living room AND a family room? Do you need BOTH?
What if you downsized your space? I know I know. It seems crazy, but roll with me for a second.
Let’s say you’ve got $100,000 of equity in your home right now and it’s worth $300,000. What if you sold your house, bought a $200,000 home and took out a $100,000, 15-year mortgage. Your mortgage goes from $1,500 a month down to $691.
Well now…THAT might be worth it!
Plus, your property tax, insurance, and utilities would likely all go down as well. In total, your housing expenses could go from $2,150 a month down to $1,150.
That’s a $1,000/month savings! Sure, it’s a bit drastic, but for an extra grand a month, it might just be worth it!
2) Sell Your Crazy Expensive Cars
The second largest expense in most households is their car.
- The payment
It all can pretty easily add up to $1,000 a month!
But, what if you didn’t have a car payment (that’s right…not EVERYONE has a car payment. That’s just a myth to keep you crawling back to the car dealership!)? If you want to learn how to drastically cut expenses, you’ll probably have to take a hard look at your cars and what they’re costing you.
If you’re truly spending $1,000 a month on your car and you want to cut costs, I’d say it’s time to sell (here’s a great article that will teach you how, even if you’re under water on the loan!).
If You Sell, What Do You Buy?
You may be willing to sell, but perhaps you’re scared that you’re going to buy a lemon!
I get it. Sure, it’s possible, but not as likely as you think.
I suggest taking a look at a 10-15 year old:
- Honda Civic (see that picture on the right? That’s Derek’s old ride!),
- Toyota Camry, or maybe even
- an old-man Buick!
These cars can be dependable for decades and you can pick them up for under $3,000.
- Buy them with cash,
- have no payment,
- pay less in insurance,
- and you may even pay less in gas!
Sure, you might have a repair here and there, but you’ll still almost certainly come out on top! I mean c’mon, have you ever heard of anyone fixing $1,000 worth of stuff on their car every month? I don’t think so.
So, sell your crazy-expensive car, buy a cheap one, and enjoy the extra $1,000 a month!
If you just did options #1 and #2 in this article, you could be saving $2,000 a month! That’s $24,000 a year! Cha-ching!!! What are you waiting for??
3) Get Rid of Your Toys
As we get older, most of us earn more and more money. This basically means it gets easier and easier to spend it on stuff that we don’t necessarily need.
- expensive lawn tractors
- wave runners
- snow machines
- and maybe even a cottage!
All this stuff might be fully paid for, but it’s still costing us a wad of cash each year to maintain them, store them, fix them, and run them!
Take a step back and think to yourself:
- “How much money could I put in my pocket if I sold all this stuff?” and
- “How much might I save if I no longer had all this stuff to take care of?”
Those are two very powerful questions, and they might just save you a ton of dough every month.
Want to learn how to drastically cut expenses? The answer may be in your toys…
4) Examine Your Monthly Expenses
Those first three items were the biggies. It’s where I’d go immediately if someone asked me how to dramatically cut expenses. Beyond that, I’d sit down with them and put on a wider lens. I’d have them lay out their monthly expenses so they can truly see where all the spend was going.
When I first sat down to assess where my money was going, it shocked me how much I was spending on eating out and on subscriptions I wasn’t even actively using. It would surprise you as well if you knew where your money is actually going each month.
So take a seat and really get to thinking. I mean, I understand we all have bills that we need to pay but is everything you’re paying really necessary??
Typical things that may be eating away at your cash flow may include:
- tv subscriptions
- expensive eating/drinking habits
- overspending on unnecessary items
All of this (yeah I really do mean ALL of this) can contribute to your expenses each month. So, the best thing to do to ensure you know about every expense is to create a detailed list of all your expenses. Seeing it for yourself can really help you see where you can start cutting down.
When creating your list of expenses, be sure to include:
- living expenses
- car payments
- your phone bill
- necessities (groceries, clothes)
- other (subscriptions/memberships, basically all your “wants”)
Once you have that list, figure out what you should keep by categorizing each expense. Budgeting apps like Mint and Every Dollar can also be extremely helpful being that they help you save and invest. The best part: you can keep it right in the palm of your hand!
5) Start a Garden – Save On Groceries
Starting a garden is a great start to drastically cutting down on your expenses. If you grow your own food, that’s less money you pay for groceries. A huge bonus is getting to eat fresh ingredients every day! You can actually get started growing your own personal garden right now. Super exciting right?!
- stay near a water source
- choose plants that are perfect for YOUR garden depending on your growing conditions
- feed your plants regularly
- get some good soil
Remember, the sun is your friend on your gardening journey.
If you’re a beginner with your garden, that’s okay. You don’t have to be an expert to get started using that green thumb.
Think of how many times you go out to eat. Even though the bill may seem small for lunch at Panera Bread or that cup of coffee at Starbucks, those bills tend to add up…QUICKLY. So, I chose the alternative — cooking!
Cooking instead of eating out can help you save more money. When you cook, you can plan your meals ahead of time. I try to do any shopping I have to do over the weekend or while my boys are at daycare. If you have a busy schedule (like mine!), try food prep.
- Prepare your meals the night before or early in the morning when you have the most time.
- Pack a lunch for work instead of grabbing fast food or something from the cafeteria.
If you can avoid spending extra money on food, do so. If you’re only going out to eat because it’s convenient, remember, frozen foods and veggies/fruits from the grocery store are convenient as well (and wayyy easier on your wallet!).
7) Work Out – Just Do it From Home
That gym membership seemed like such a good idea, right? Well, it’s the thought that counts.
In theory, it may have looked like a good idea. However, you can still get a great exercise in without having to waste a dime. I know, I know…that Planet Fitness membership seemed like it would really work out (get it, work out? Lol. Sorry, I couldn’t help it!!)…But when you’re a busy parent with a full-time job and a HUGE to-do list every day, how are you supposed to make to the gym?
My Gym Alternative?
Cancel the membership and do your exercises in the morning, at night, or whenever you have the freest time to yourself. You can use the gym on-site at your apartment complex (you pay for that as well in your rent). Or, get creative! My boys and I take walks when we get home every day. It’s not the perfect workout, but every bit counts!
We also go:
- and run around the local park
There’s so much to do right outside (even with social distancing). And it’s all free!
8) Do Price Comparisons
Price comparisons have been a life-changer and money saver in my home. I compare the prices of everything now. From insurance to phone carriers to food — if you have to spend money on it, I guarantee you can find it somewhere cheaper than you thought. You may be wondering how you can compare prices on things you need every day, well, there’s an app for that!
These are all super helpful price comparison apps for different items. And the list just keeps going!
If you want, you can also use those coupons and newspapers you get in the mail. Compare your items based on that. You could save tons of money just by taking a second to compare store prices. FYI, this is also helpful when it comes to gas. You can check the gas prices in any given area just by using a google search.
Related: BillCutterz – They Can Seriously Save You Hundreds (affiliate link – thanks in advance! :))
9) Try a Different Commute
How do you commute? Do you drive? If you’re able, try something different!
- If you live near a co-worker, consider carpooling.
- Are you close to your job? Well, maybe try walking or bike-riding.
- You could also consider using ridesharing apps like Uber or Lyft.
- You may even want to try riding the bus.
The goal is to cut down on your gas costs and save on doing so much maintenance on your vehicle. So, if possible, try something new! You never know, riding your bike to work may actually be liberating.
10) Eliminate Your Cable Bill
So, I don’t have cable. I never really saw the purpose when we don’t watch every channel that cable tv has to offer. Think about it, you’re wasting money on your cable bill just so one person can watch sports, another can watch cartoons, and someone else can watch the news.
Consider this, you can still get something for everyone by using sites like:
And many more. They offer the same thing that cable tv has to offer…but it’s cheaper. So why waste money getting everything you don’t need when you could invest in one of those apps and get something for everyone? All without paying as much as your cable bill costs.
Instead of shopping for items every day, it may make sense to buy in bulk.
Almost anything can be bought in bulk, including:
- school items
I like to shop in bulk mainly for all of the discounts. Keep a lookout when you’re at the store for items that can be bought in bulk and see how many you need to get in order to save money. You can even go to places like Sam’s Club or Costco to save a ton of money on everyday items.
12) Sell/Donate Your Old Items
Do you have old clothes or baby items that you no longer need? What about those old purses or shoes you rarely wear that are still in great condition? Well, you can make money off that as well.
When my boys and I have outgrown clothes, I get them ready for donation. Same with their old baby toys and items. Whatever you are no longer using that is still in good condition, donate!
If you want to sell the items instead, try using sites like:
Even the Facebook Marketplace lets you sell just about anything. Just remember, someone somewhere needs it more than you need it to collect dust in your home.
13) Brew Your Own Coffee
Well, this one is a no-brainer.
Coffee isn’t my first choice of beverage, I’d rather drink tea. However, both can be brewed right in your home.
You don’t have to spend $2-$6 every day on a beverage. That cost adds up quickly. Just do it yourself and save yourself the hassle of having to wait and having to pay. Invest in a coffee maker and it pays back tenfold in the long run.
How to Drastically Cut Expenses… Now You Know!
You can cut down on your expenses. It’s really all about self-control and dedication.
You have to be able to let some things go that you really don’t need. I mean, honestly, how else do we expect to get to where we want to be if we don’t make necessary changes? Just remind yourself that the opportunity is there for everyone, but only those who stay focused on the goal can truly achieve.
Do you have any other helpful tips on how to drastically cut expenses? Let us know in the comments below!
AUTHOR LaTia Longuemire
My name is LaTia Longuemire. I enjoy writing, singing, and cooking in my spare time. My passion is helping others. At this stage in my lifetime, I'm primarily focused on my children. They are everything that keeps my world spinning.