5 Tips to Save on Monthly Expenses

Editor’s note: This is a guest post, written by Rob Erich from ARicherYou.com.

Have you ever gotten to the end of the month and wondered where all of your money went?

You thought you had a great paying job, but by the time you pay for life’s necessities, there’s nothing left!

Salaries have been stagnant for nearly 20 years – and unfortunately, most of us can’t resolve this financial issue by holding out for a 25% raise.

However, we can make smart money decisions to reduce our expenses and make life more affordable.

Here are 5 tips to save on monthly expenses that don’t involve clipping coupons or reducing how much toilet paper you use (and yes, that is a thing).

1. Live closer to work

How much does your commute cost you? Most people don’t think about this question from a financial perspective.

First, you have the actual cost of gas, wear-and-tear on your car, and insurance/registration. Although this varies by vehicle, the IRS estimates each mile driven to be worth about $0.55.

Next, let’s calculate how much your commute time is worth based on your hourly rate.

Once you do these calculations for your own scenario, you’ll be amazed at how much you’ll save by living closer to the office.

For someone making $25/hr, a 20-minute commute costs $11,250 per year! That’s a lot of money to spend just getting to work.

2. Rent instead of buy (maybe)

Depending on where you live, renting a home can be more affordable than buying. Although buying does help you build equity, sometimes it’s better to use that money elsewhere.

If you can rent a nice apartment close to work for about the same price as a bigger house in the suburbs, you can save yourself money and time.

In addition to the commuter savings from living close to everything, a rental reduces your time and money commitment for repairs and maintenance. As a tenant, you can simply call the landlord anytime an issue arises.

Plus, the money that you would have invested into a house can often be invested elsewhere for an equally high (or higher) annual return.

3. Pay off debt with high-interest fees

A home mortgage is really the only kind of “good” debt – provided the monthly payment is less than what you would pay for rent.

All other debts (credit cards, personal loans, student loans) increase your monthly expenses with unnecessary interest.

Unfortunately, it’s all-too-common for young adults to have $1,000+ monthly student loan payments. Then when you add a few hundred dollars for credit card payments, you can easily blow your entire paycheck on paying for purchases made 3 years ago!

Debt can be hard to pay off fast, but the sooner you take care of it, the sooner you’ll have extra spending cash (and the sooner you’ll be able to avoid high-interest rates).

4. Buy discounted gift cards

This tip is the closest I’ll get to “couponing” – but it’s still way cooler and more financially beneficial.

There are multiple websites that allow you to buy discounted gift cards to hundreds of restaurants, grocery stores, gas stations, and department stores.

You can save up to 35% on purchases that you make every day by using these gift cards.

Although saving 3% on your Subway sandwich may not be worth your time, if you can save 15% on your next laptop or flight, you’ll keep your wallet fatter.

5. Trim fees for unnecessary expenses

It’s amazing how many people pay monthly subscription fees for services they never use.

From gym memberships to Netflix, to cable and landline payments – you could be paying out hundreds every month for services that you never use (or could find a cheaper alternative for).

One of my favorite tools for cutting costs is the free Trim app. This app helps you analyze your spending and finds ways to cut costs – especially around subscription services.

If you can cut out one $20/month subscription services, you’ll have an extra $240 every year to spend on whatever you want! So start trimming those expenses.

Conclusion: Reduce your expenses by focusing on big spending first

There are hundreds of blog posts and articles that share ways you can save a few dollars by committing hours of your time to hunting coupons or making something yourself.

In my opinion, this isn’t a good use of your time.

Sure, if you can save a few bucks here and there, it’s smart to do it, but don’t waste hours hunting down a BOGO deal on your cereal.

Instead, spend your time finding and cutting the big expenses that could save you hundreds, or even thousands, every year.

Now, go start saving!