We all fall into bad habits from time to time. Maybe you leave the lights on when you leave a room, or you crack your knuckles. For the most part, these habits are annoying but not necessarily harmful. When a habit impacts your finances, however, you have clear motivation to break it.
You may have noticed you’re spending more than you should, and catch yourself wondering how to save money. Here are some money-saving tips to help you change your routine and sock more away in a high yield savings account or money market account. Recent consumer studies show small recurring expenses continue to rise, making awareness of spending habits more important than ever.
Let’s review a few helpful tips to consider how you are spending money.
Tip #1: Be Mindful of Convenience Costs
When reviewing your monthly household budget, consider the price tag on convenience. We get a lot of things delivered to us every month, things we don’t even think about. Maybe you subscribe to a streaming video service, with an average cost of about $100–$150 per year. Or maybe you have “free” two-day shipping, for typically over $100 per year. But do you actively watch all those streaming services each month? Do you really need immediate delivery? Convenience is nice, but don’t forget it comes at a price. In uncertain economic times, it’s natural to look for ways to adjust your spending habits.
“We put too much of a premium on convenience,” says Dan Andrews, founder of Well-Rounded Success, a personal finance consultancy based in Fort Collins, Colo. “A lot of monthly subscriptions aren’t services people consistently use.”
Tip #2: Consider Quality Purchases to Achieve Longterm Savings
Stop pinching pennies. It may seem counterintuitive, but it’s important to find a happy medium between saving responsibly and skimping unnecessarily. After all, sometimes you really do need a new couch – and you’re better off paying more for one that will last a long time than buying the least expensive option, which you’ll have to replace again in a few years. In some cases, choosing durable, higher-quality items can reduce long-term replacement costs.
Tip #3: Remember to Track All Spending
Don’t spend and forget. Keeping track of your spending does take effort, but it can pay off. Consider using budgeting tools or apps for your household expenditures; or maybe just try a savings app.
Track your spending obsessively for the first six months, even during challenging financial times and amid economic constraints. For the first 90 days of tracking, see if you can identify any patterns. At the end of that time 90-day period, sit down and do an audit to see exactly where your money is going. You may be surprised how quickly you can save hundreds of dollars. And that shock can be the catalyst to spark both new spending and saving habits.
READ MORE: Unlock Your Savings: 5 Proven Strategies to Save $1K in 30 Days
Tip #4: Adopt a DIY Mentality When Possible
Don’t call for help so quickly. Do you have a leaky faucet or a light switch on the fritz? Small repairs don’t always require a handyman. Spend a few minutes watching online video tutorials, or pick up a how-to book at the library, and see what repairs you can do yourself – even if they seem impossible at first glance. Always consult a professional for electrical or plumbing work beyond basic DIY. (Don’t have the right tools? See if a neighbor has some you can borrow.) You’ll be amazed how quickly you can save hundreds of dollars. DIY repairs can reduce short-term expenses and help build an emergency fund. And, as an added bonus, you’ll learn something new.
The Bottom Line
These tips for saving money are a good place to start. But it also pays to look into your savings account interest rates to ensure that you’re getting the most out of what you save.
Ready to get started? Explore Synchrony’s Savings Products to lock in competitive rates and maximize your savings momentum.