Saving Big: The Silent Game-Changer

There’s no way around it, a solid emergency fund can save you from all kinds of trouble down the road. If you’re serious about playing the long-game with your finances, and coming out stronger, then you’ll have to prioritize saving.

When it comes to building wealth, it seems, all of the attention goes to investing. Books, blogs, forums, and news articles are constantly discussing the latest trends in investing or what it means for the little guy. But the real heavy-lifting, at least when it comes to financial security, is being done by good old fashioned saving.

Don’t get me wrong, good investing is eventually an essential piece of the wealth building puzzle, but that’s only for those who have earned the right. If you’re new to personal finance, you’re likely better off focusing all your efforts on saving big and avoiding common mistakes that sink so many hopeful savers.

How do I know saving is such a big deal? My own experience has taught me this. By focusing relentlessly on building an emergency fund, my wife and I were able to weather a period of unemployment with far less stress than if we had immediately put all our money into investments. I’m convinced that this margin in our finances was an incredible gift, and allowed me to pursue a new career path and eventually launch a side business.

If you’d like to grow your savings without taking on a second job or any more risk, check out these tips which are drawn from the best of what I’ve learned over the years.

Review all your subscriptions once a year

Many small businesses and big companies, too, are going to a subscription based model, especially for software and services. It’s a win for both parties as it smooths the cash flow and lowers the cost to try something new. The downside is that it’s easy to forget about a subscription you’re not using. With so many recurring payments, it’s likely you could save a big chunk of change by reviewing once a year and canceling anything that isn’t essential.

Get into walking to save on transport costs

Why drive when you can walk? Many of the places you drive may not be as far as you think, and by saving on gas, vehicle maintenance, and parking fees, you could be saving hundreds per year while becoming much healthier in the process.

Adopt a few frugal hobbies and entertainment options

I have some expensive hobbies, such as travel, that I’m happy to splurge on. But to save some buffer for those special occasions, I try to choose frugal hobbies day to day. One of my favorite is reading. I have a free library card and so reading, an enjoyable activity, costs me nothing.

Thrift any clothes you won’t wear many times

I still like to buy new clothes when I find something I really like, but for things I will only wear a few times, there’s no need to spend big. You can find perfectly good dress clothes or other nice items at a thrift store for a fraction of the price you’d pay even on clearance.

Plan your meals and eat out less

Since having four kids, eating out has become a big expense. We still do it for special occasions, of course, but the cost of even a cheap meal adds up so fast. It’s cheaper and healthier to simply plan your meals out in advance and buy the ingredients in bulk at the grocery store.

Use a credit card with good rewards

I know some people have a hard time with credit cards, and if that’s you, I’m totally ok with using cash. But, for those of us who can be disciplined, you should be getting some kind of rewards or cash back for all your spending. I treat my family to a modest vacation each year from the rewards I earn just by paying normal bills with a credit card.

Look into comparison shopping to save on utilities

Comparison shopping is something I do on a regular basis, and it’s a great way to be intentional with your spending. But one area that’s overlooked is the cost of your utilities and insurance bills. It’s never been easier to shop around with online reviews so easily available, and you might find you’re leaving hundreds of dollars per year on the table by sticking with the same company year after year.

Start a small garden to lower your grocery bill

My wife has turned gardening into one of her favorite hobbies, and it’s a great way to lower your cost of eating healthily. In the summer months, we still purchase many groceries, but we can get by with buying many of our favorite veggies, such as tomatoes and peppers.

Live below your means even as your income grows

One of the sneakiest ways to spend more than you plan is to let your cost of living rise as your income grows. I have friends who never learned this lesson, and now spend every dime they earn— no matter how much their family brings home. The trick is to maintain your lifestyle and bank all those raises and bonuses into your savings account.

Repurpose items you already own for new uses

I bet you own all kinds of items that could be used in ways you never imagined. If you’re constantly looking for new items to make your life easier, consider the way people did things in the past or try to come up with a way to make an old item do in a pinch. I’m always doing this in the kitchen by using various tools in ways they weren’t designed for. That’s part of the fun!

Choose a lower cost of living area and cheaper housing

One of the biggest financial decisions my wife and I made, and likely one of the best, was choosing to live in an area with a lower cost of living. In fact, we moved from New York to Pennsylvania for this very reason. It’s been a huge (and simple) way for us to save big while still pursuing our career dreams.

Saving definitely isn’t as fun or exciting as investing. But what it lacks in sex appeal, it makes up for in being far more predictable and steadfast than investing. In fact, a good deal of having a successful investment experience simply means holding your investments for a long period of time without needing to sell them. And that work is mostly done by good old saving and establishing an emergency fund for those expected expenses. Don’t overlook the quiet, compounding effects of simply saving more of the money you earn— it’s a simple game-changer.