Cutting Expenses? Effective Ways To Do It

Cutting Expenses

We all like to live a lavish lifestyle. Well decorated homes, fancy cars, exotic vacations, meals at fine-dining restaurants, designer clothes. Having a lavish lifestyle doesn’t have to be at the cost of financial security.  There are many ways in which you can live a good life while cutting expenses to make way for your financial security.

Among the very basics of financial planning, budget and cutting expenses are considered among the most primary steps.

I will be exploring many ways in which we can cut expenses in a 2 part series. Today in our 1st part, we will explore a few options and the remaining ones when our next blog post is due.

So let’s begin

Transportation

Let’s face the elephant in the room – Cars are money bottomless pits. Not only does their value constantly go down, they devour fuel by the gallon, require all kinds of pricey maintenance apart from car payments, interest, insurance, gas, and the list still does not even contain parking charges!

So, how do we reduce this cost?

1. Use public transportation

If you can use public transportation, you can save quite a bit of money on gas, parking and maintenance over time.

Rideshare services like Ola and Uber make it easier than ever to live car-free in major cities, allowing you to rent a car or hire a ride for the occasional night out or day trip to the country.

Public Transport

I’ve done this myself: During the start of my career, I exclusively used public transportation to get around and save money, and even now in spite of owning a car, I still go about my daily routine in a public transport than a car and it saves me lots of time, money and frustration due to traffic.

2. Sell a vehicle

If you own a vehicle which is rarely used, consider selling it. If nothing else, you’ll save money on insurance and maintenance.

3. Carpool to work

If you have an opportunity to share a ride to and from work with someone else, you can save a lot of money.

Debt

Debt

Any chance of reducing how much money you owe, it will help lower your ongoing monthly expenses.

For starters, paying off debt means fewer monthly bills to pay, leaving you with more money to save.

Here are a few ways to cut down on debt and save money over time.

1.     Refinance your home, automobile, credit card and student’s loan

Home Loan

If you think you can refinance your mortgage at a lower rate, you need to contact some lending institutions.

Refinancing loan with a lower interest rate will not only save money over the life of the loan, but can also lower your monthly payment and increase your monthly cash flow.

2. Request a credit card rate reduction

If you’ve got a fairly large balance on your credit card, talk to your credit card company and request a rate reduction. If you pay your bill on time every month, they may negotiate.

3. Sign up for automatic debt repayment plans

You should sign up for automatic monthly billing for all monthly bills, instalments, loans and SIP’s. They’re incredibly convenient and ensure you won’t miss a payment or incur a late fee.

4. Sell unused items

Dig through your closets and look for items you no longer use that may have value, then sell them on Olx. You can then use the money you bring in to pay off debt.

I did this myself earlier when I just started working with a number of items, including my clothes, old but decent furniture.

Energy Bills

From hot summers to cold winters and all the gadgets we plug in, we spend a lot of money on energy bills. Fortunately, technology has brought us a few effective ways to improve energy efficiency and lower that figure.

1. Install LED light bulbs

LED Bulb

Consider switching to your lightbulbs to LEDs. These bulbs are about four times more energy efficient and last for many years.

2. Unplug all unused electrical devices

Are there any electrical devices around the house that stay plugged in, but you rarely use?

Most electronic devices constantly draw a small amount of electricity, a phantom charge, that can add up quickly when you consider just how many devices and small appliances you own.

To eliminate that usage, unplug unused electrical devices.

Entertainment Expenses

Many people look at entertainment as the first thing to trim when cutting expenses, but they often forget to look at the regular expenditures that slowly eat away  money.

Here are some things to consider that you may have overlooked before.

1. Cancel club memberships

Gym

Look at expenses such your gym membership, your membership with the local club, and so on.

How often do you really use these services?

If you’re using a gym or a club membership less than once a week, you’re throwing away money. Try cancelling these and see if you really miss them.

2. Reduce or eliminate your cable bill

How many channels do you watch? It is not necessary to have premium cable.  Perhaps you could downgrade from premium to basic cable, or maybe you could even eliminate your cable bill entirely.

If you cut cable TV, it’s great to take advantage of streaming services like Netflix. Most people could find a cheaper way to gain access to their favorite shows if they tried hard enough.

3. Cancel newspaper and magazine subscriptions

If you get a magazine or newspaper in the mail but don’t read it, cancel that subscription. If you need reading material, hit up your local library instead.

Today we talked about cutting expenses on transportation, debt, energy bills and entertainment.

We will continue our 2nd part of the series of cutting expenses on Thursday.

Until then

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