How we saved $23,000 per year

You read them everywhere, how to save on …. Look around this blog and you’ll find them here as well; articles on how to save money. As you read them you might ask yourself how eliminating a dripping faucet can build you wealth. The answer is simple; all little amounts help, they tend to add up to a lot.

For years I thought we were living below our means and in effect we were as money was left at the end of each month. After we started budgeting, we actually learned we could cut our expenses even more, a lot more. Here is how we saved $23,000 per year and how you could save some too:

Revisit your cable bill
The package on our cable bill was so outdated we were paying for services that no longer existed. By simply cutting our cable bill we managed to save over $720 per year. We actually improved our service while saving. Read about it in detail in Stick with cable and still save hundreds.

Look at your phone expenses
We were one of the hold outs and still had a land line. Do you really still need it? It seemed we were only getting robo-calls. We dropped our land-line and consolidated our cell phones under a family plan. We managed to save $228 per year changing our calling habits.

Know how much you spend at the grocery storeHow we saved $23,000 per year
If you’re not sure about where you fall on the scale of grocery spenders, check out the USDA’s website. You can figure out if and how much you are overspending at the register. By simply informing ourselves we managed to save $2,400 a year. You can read more about it in Gwyneth Paltrow and your groceries.

Dine out a little less
We were notorious spenders when it comes to dining out. $500 a month wasn’t unusual. When we started budgeting (or should I say budgeting startled us) and figured we were spending on average $360 a month we made some changes. We now Dine out on a budget of $170 a month and save $2,280 a year.

Drop those incandescent light bulbs
Ready to move on to Compact Fluorescent? Don’t, skip those and go straight to LED’s. The upfront investment is a little higher but we manage to save $348 per year after we made the switch. Read more about it in 10 ways to save money on your utility bills.

Ready to buy a new car, consider a Hybrid
I’d say switch to electric but that is still a little too expensive. The myth of Hybrid cars not being economical is just that, a myth. I worked out the numbers in detail in Should I still buy a Hybrid. We managed to save $936 per year by getting a Hybrid.

 Have you refinanced yet?
Interest rates aren’t at their lowest anymore but they are still good (looking back in time). We managed to refinance and although we didn’t reduce our interest by that much (only 1.25%) we still managed to save $2,700 a year by refinancing.

Buy memberships
Did you know that two visits to your favorite museum can be more expensive than a membership. Read all about it in How we save over $4,000 by getting memberships. That’s right we’re saving $4,000 a year on this one.

 Cut the clothing budget
We’ve never been big spenders on clothing. As a matter of fact my annual hiking shoes probably ranked up top on our spending there. We keep our spending down by buying when we need, accepting hand-me-downs and buying at consignment stores. We managed to save $1,080 per year on clothing.

Limit your discretionary spending
I was terrible when it came to discretionary spending. I had to have the latest IPads, those early AR drones; I had 3 of them and every sci-fi movie that came out on iTunes; I got it. I know it is hard to let this one go but we cut out discretionary spending by $700 and managed to save $8,400 a year.

There you have it; this is how we managed to save over $23,000 a year after we were already living below our means. If you have a story to share I love to here it. If you want to know where to get started, start with a budget first. You can read all about that in my series on Creating and maintaining a real budget.

Good luck reaching your financial goals.

About Maarten van Lier

Maarten came to this country with a suitcase and a diploma. He created a financial plan and goal to become a millionaire in 10 years. He successfully turned his financial goals into reality, wrote a book about it and now blogs actively in hope of inspiring other to do the same.