Frugal living to supercharge your savings

Frugal living to supercharge your savings
Frugal living to supercharge your savings

Side gigs and hustles are awesome. Whether it’s to save for a dream vacation or retire early, they can really help you achieve your financial goals. But there’s an area of frugality that’s very powerful: trimming recurring expenses. Being frugal is gift that keeps on giving, month after month after month.

So as you consider which side gig or hustle you’re going to do to achieve your financial goals, also take a look at trimming your recurring expenses to increase your financial gains!

Ditch the cable or satellite

According to this article over at Forbes, the average cable bill is something like USD$103.

We ditched satellite TV about 5-years ago and have never looked back. Netflix and Apple TV replaced the signals beamed in from space. Although it was hard as we missed channels like Discovery. My 5-year old son has no concept of traditional TV, he thinks Netflix is TV. Yes we have to pay something for our Netflix subscription and our Apple purchases, but it’s a lot less than the $160/month I was previously spending on satellite.

If you really, really can’t live without cable (or satellite) at least call the company and try and negotiate. Even go guerilla and threaten to cancel your subscription. They’ll often do something for you such as a discount for a few months.

Potential Savings: $103 per month

Notch down your Internet

They’re pushing gigabit bandwidth Internet right now where I live. With Netflix saying that even their ultra high-resolution 4K content only needs 25-megabits of bandwidth, that’s overkill for just about everyone’s needs.

The point being, we often buy the biggest and baddest just because we can.

Check that your Internet really meets your needs. Most people can get by with a 25-megabit or less service and can therefore pay $30-40/month versus $60+.

Potential Savings: $20 per month

Pass up the daily latte

I’m a reformed Starbucks addict. Even though I rarely drank the fancier drinks, I did quaff down three or four $2 coffees a day.

In this age of coffee pods that come in every imaginable flavour and machines that’ll automatically grind and brew your beans first thing in the morning, you already have convenience at home if you make a little effort to get setup.

I don’t recommend coffee pods if you want to be really frugal (they’re about twice the cost of brewed coffee), but they still only ring-in at about a dollar a cup for a latte versus the $6 at the Seattle coffee chain. A good compromise.

Potential Savings: $150 per month (one latte minus the cost of a coffee pod)

Renegotiate your cellphone bill

My cellphone is on a business plan rather than a personal plan. Not because I’m some hot-shot executive, but because my wife’s employer extends their preferred rates to their employee’s and their families. It saves me approximately $30 per month versus what I’d pay if I called up my service provider as a regular consumer.

So, when it comes to your cellphone bill, it’s worth checking to see if your membership of any clubs, alumni status or employment connections can help you save a few bucks a month.

If that doesn’t work, call you cellphone company! You might be surprised as a lot of them will actually work with you to find the right plan these days. And if that’s not working out, tell them you’ll have to cancel as you can no longer afford the plan.

Another area for saving is right-saving your plan for your needs. Do you really need a plan with unlimited text messages? Can you save a few dollars a month by not having that feature? Is there an a la carte plan where you can pick exactly what you need? When was the last time I actually used 5-gigabytes of data in a month?

There might not be huge savings to be had, but if you can haggle out $10/month in savings on your cellphone bill, that’s like getting two or more months of service for free over a year.

Potential Savings: $10 per month

Eat less meat

Meat is an expensive item on your grocery bill. Given recent research concerning the role of red meat and charred meat stuffs in cancer, maybe it’s time to cut down a bit?

If you won’t cut down for health reasons, how about financial reasons? Assuming that for a family of 3-4 the cost of meat per main meal every day is $5, that meat is costing you $5 * 7 days * 4.3 weeks = $150.50 per month.

If we go meatless two days a week, we’re looking at a total spend of $107.50 per month. We’ve done exactly this in my household and I have cauliflower + chickpea curry on the stove as I type.

Potential Savings: $43 per month

What if you’re too busy/lazy to do this?

If you’re too busy or lazy to negotiate your bills yourself, there’re now companies that specialize in doing just this for you. They take a cut of the savings, but they also cut out the hassle.

One such example is Bill Fixers.

Supercharge your savings through frugal living

$326 per month at 5% interest compounded over 25-years

If you were able to achieve the savings outlined above, you’d have an extra $326/month in your pocket. But before you go out and spend it, consider the power of saving that money on a month-in, month-out basis.

I love dividend stocks and with a small portfolio of dividend stocks of varying risks, it’s feasible to generate a 5% rate of return. We’ll assume that the stock price stays steady for the duration that you hold the stocks for the sake of simplicity.

$326 per month at 5% interest compounded over 25-years is $191,727. All you’ve done is tune-up your finances with a frugal living (and maybe you have other areas of savings to add to this).

An extra $191,727 would help you retire a few years earlier (assuming you were also saving for retirement elsewhere!). Imagine having that kind of freedom?

Let me know how you’re supercharging your savings through frugal living in the comments and how you plan to use the money saved!

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  1. Appreciate the great tips on keeping costs down. Between minimizing costs for housing, transportation and food (live near work, drive a junker or ride a bike, eat great home-cooked meals, and choose affordable over luxury) plus dropping those recurrent costs, it all adds up over time. It can actually become a point of pride over time to diverge from the Joneses. As a doc who cuts his own hair, drives a used Kia, and recently returned his iphone to switch from Sprint to Project Fi for cel service, I’m considered an eccentric among colleagues. Peers have gone from curious to appreciative of my goals, and best of all, like-minded folks seem to seek me out over time, creating a supportive community.

    Look forward to more great tips over time!



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