Now I would love to ask everybody, now that we’ve talked about ways consumers overspend
I’d love to talk about your favorite ways that we can save money. Easy, simple tips for the average consumer
to save big this year. So can we start with Melissa again?
Sure. I think the number one way to start being mindful of your money is to track your spending.
It’s the same as calories. Cash and calories. It’s so easy to overspend, to overindulge, and
so we need to know where our money is going so we know how much discretionary income that we have to spend as we please, and if
you can kind of get into that mindset that it isn’t about doing without, it’s about knowing what I have to spend freely
then things kind of change, and whether you’re using a product like Quicken or however you’re doing it,
doing it on a daily basis is going to make it very simple to do, very easy. It’ll take you just a couple of minutes a day.
Don’t worry about going back and adding all your spending for the last, even for just the last eighteen days of the year.
Just start now. Start today. My second tip really quick. Going back to the food example
is to create a non-negotiable day to get to the grocery store, and that is just that you make an appointment with yourself.
This is important food. You have to eat, (laughs) and so having food in your home is key.
So creating that non-negotiable day, and going with a list of ingredients for meals rather than a list of groceries that you need.
Groceries are what you bring home. You spend two hundred dollars on, you bring them home, and then you have nothing to eat in the house. (laughs)
Ingredients for meals are things that you’re going to end up cooking. And then finally, my last bit of advice would be
to create a spending book, and it would be something like this. Just a little blank notebook that you
can use to track things that you want to spend your money on and it’s almost giving you permission
as long as you have the money available to you. It would be the clothes that you need to add to your wardrobe,
It would be the movies that you want to go out to see because your time is just as important as your money
so you want to make sure if you’re going to go to the movies you’re going to remember that movie that you really wanted to see
or remember that book you really want to buy, and so I’m a big, big fan of a spending book because it helps us
create a very purposeful life. Saving you time and saving you money, two of my my favorite things.
I love that idea. I might have to adopt that aft this. (laughs) Okay so Brittany, what are your favorite ways to save money?
Well I agree with Melissa, of course, and definitely I think automation is huge. I mean, just coming from a more
financial planning tactical side, the more you can automate your financial life, the easier it will become for you to save
money and spend less money. So what I mean by that is you should have all your committed bills be automated.
Direct bill pay-those should come out first. You definitely want to make sure those are averaging about fifty percent
of your net income every month. That would be like rent, utilities, insurance premiums, basic, you know, things you need to survive.
Then you want to try to automate your savings, which should be about ten to fifteen percent of your net income.
So if you can set that up so you have a savings plan going to maybe building your emergency fund, maybe extra debt payments,
retirements. Automate that just like a bill. And then finally, you can spend the rest of the money every month, and you can
do some guilt free spending. And that leads me into my second tip which is all about mindful spending.
Just like Melissa said, you need to be aware of your spending habits daily, weekly, and stay in the awareness of
am I spending in alignment with my core values in life? You know, does this purchase bring me more happiness or is it just
something I’m doing to keep up with the Joneses? So practicing mindful spending is huge, and then the third thing
would be the tracking. So tracking your spending habits you can, you know, I just have clients keep a notebook and a pen
for thirty days. It sounds so cheesy and old school, but it works because the thing is you need to train your mind
to be spending in alignment with this allocation that you’ve said you have every month, and by actually putting pen to paper
you’re like training your mind to stay within those healthy boundaries. But what you have to do is not only
track your expenses but then go back and review it. So you know, then you could double check and say, “Okay,
look at all of these purchases. Some of them were actually in alignment with my values in life, and some of them were just
you know, random purchases. I could definitely eliminate that.” You want to cut back on all of those mindless
purchases or spending and get more in the mindful spending.
Okay, great tips! How about you, Donna. You’re next.
Well along the line of tracking your spending, I want to say create a budget, and budget is one of those words
like diet or colonoscopy words (all laugh) nobody really wants to think about because they sort of connote deprivation,
not deprivation. They connote kind of fear and pain and maybe discomfort, but I disagree. A budget is very freeing
because, as someone else has already pointed out, you know what you have coming in, you know where it’s going,
and then what’s left is yours to spend or save. So definitely create a budget. Yesterday I got my hair cut and
the stylist said, “I know I need to save more money. I just can’t. I just don’t know where it goes,” and I said, “Write
this down: M-I-N-T dot C-O-M. You really need to put their money into this software that is going to tell you where your money goes
Then you get to determine where you want it to go,” and sure enough as I was paying she said, “What was that website address again?”
and she wrote it on a sticky, and I hope to God she uses it because she has three children. You know they need to learn money habits from their
mom. Not just that she, you know, stops at McDonald’s because she’s too tired to cook or that she just buys them
whatever they want. Another way of saving money, again, pack your lunch and learn to cook.
I understand that for this generation eating out is more of a necessity in their minds, and I also know that eating lunch out can
be a networking or team building or whatever you want to call it. So start small. Take your lunch twice a week, and
cook three nights a week. In fact, if you cook enough you won’t only have to cook three times a week, and you’ll have
leftovers or repurposed leftovers later. I would also suggest an app called ImpulseSave. When you’re out shopping
and you say, “no” to that latte or you say, “Oh no, I’m not going to buy those earrings. I don’t need more earrings,”
you type the amount you would have spent into ImpulseSave. It’s an app, but it’s also online, and that money immediately gets taken
out of your checking account and sent to an online savings account. So instead of impulse spending you’re impulse saving.
And I’m not getting any money for recommending this app. I just think it’s a great idea. So that’s a good one, I believe.
Was that two or three? (laughs)
I think that was three. (laughs)
Okay. I’ll be quiet now.
How about you, Margaret? You’re next.
Alright. Well my number one on my list was to be intentional. Be intentional with your spending. I think if you
you know, if you have a general idea of what, you know, a new hobby you’re going to adopt or this is going to be the year of
Margaret skiing, right? So then I’m going to be really intentional about the purchases that I make,
so that I can make that a reality so that at the end of the season I’m not just saying, wait a second, how did I only get in two trips to the
mountain and what happened to the rest of my money? So being intentional with what you’re actually, with what you’re doing with that money.
Which kind of is just part of planning. You know, planning and thinking ahead about what are the big, what are the ways that you really want to
treat yourself this year rather than treating yourself on a small, daily basis. I think also being creative. Being creative
about, so vacations, the example I used earlier. Travel. Rather than taking that flight with the whole family and staying in hotels
maybe consider camping. You know, maybe do something different. Do something that you haven’t done before.
where you’re investing perhaps in some camping gear that you can use again and again whereas that flight, you can’t. It’s gone.
And then also, you know on that same note, just experiment. Experiment with new ways to save money. I think we’ve all been kind of talking about
new things to try and ways to adjust your, adjust the way you spend money even with you know, what Donna was just saying
about you know, two days a week bringing your lunch to work, making small changes. But try something like
you know, a buyer driven site like BuyStand. I mean it’s just it’s a way that you can potentially save some money and
why not give it a try?
Okay, and Justin.
So I’m going to remain in the realm of tips for homeowners and go back to what I was saying earlier about energy
being such an amazing spending suck. Drafts, like I mentioned before, big thing. We tend to focus on keeping
or providing really really simple, easy, low-cost solutions to help people save money. That tube of caulk I mentioned
Five dollars a caulk may not save a life, but it can save you up to thirty percent on your energy bills thought the year.
Another little thing is dropping your temperature one degree. For every degree you drop it down, you can save up to three percent
of energy on your monthly bills. Going back to what I was saying before about that, you know, those avoidable
repair and replacement costs of systems, my partner has this word that he invented that he reminds me of every day called proactivity
and it’s basically just taking a little time to do preventative maintenance or to do little simple steps
that’ll keep those appliances and systems lasting a lot longer. A good example of this is simply replacing your furnace filter.
It takes five minutes. It’s between five and you know, twelve dollars let’s say depending on your air filter, and it’s going to have you breathing cleaner air,
lowering your energy bills, and it’s going to make that particular appliance last a lot longer.
I think the last one is relating to the unnecessary contractor and service fees. Plumbers tend to be pretty expensive.
You know most average plumbing calls are around the two-hundred and fifty dollar mark, and we really like to focus on
things around the house, common household items, that you can use. We maybe overuse vodka because we’re pretty big fans of that, but
there’s a number of household items that you could use to do some of these preventative maintenance steps that will help prevent those guys
from having to come out to your house and save you a lot of money throughout the course of the year. So we try to chop things up into bite-size, simple
pieces that everyone can do, and I think figuring out ways to do it yourself sometimes really goes a long way in helping you save money.
Very true. Alright, I’ll finish up with my three easy ways to save. First, and these I use in my personal life,
I’m a huge fan of shopping used, secondhand or used so thrift stores, Craigslist. You can use your social networks to find
used items. One of the biggest suggestions I have is it’s one thing to buy used and you get a deal, but what we recommend is
figuring the difference between what you would have paid new, what you paid used, and then actually physically saving
that money. So there are lots of easy, small ways to save, but you actually need to do something with the money that you’re saving.
And then I know that Brittany mentioned this before, but automate your savings. So you know, out of sight, out of mind.
Pay yourself first. We always recommend scheduling regular transfers into savings account, but you want to make sure that
you’re not using the savings account as overdraft protection. Don’t make it easily accessible. We love online bank accounts
for emergency funds because it takes about two days to transfer the money into your regular checking account, and so if it’s truly an emergency
you’re not making an impulsive move by having that money easily accessible. You can take a couple days to think about it before
it gets there. And then finally, and I know this has been mentioned before also, is don’t shop when you are hungry or sad
and wait thirty days before making a major purchase. It’s easy to overspend when your judgement is clouded.
You can go for a walk, call a friend, even veg out in front of the T.V. to distract yourself from that feeling of wanting to spend money.