1. Start With 50/20/30: Budgets may not be sexy but they’re key to sticking to spending plans and helping you reach your financial goals. Take a fresh look at the coming year’s expenses and create a budget on the 50/20/30 Rule: 50% of take-home pay goes to necessary living expenses, 20% goes to financial goals like paying down debt or retirement, and 30% goes to lifestyle. Use tools like Mint or BudgetTracker to easily track your spending.
2. Aim for Double or Triple Payments: Paying down debt should be a priority. Whether you take the debt snowball approach or opt for tackling your highest-interest debt first, write down your goals. Always aim to pay double to triple the minimum balance or you will continue to drown in debt.
3. Identify Your Triggers: Spending is often associated with emotional states including anger and sadness. Identify your triggers and be prepared with alternative activities to manage them, like calling a friend or recording your thoughts in a journal.
4. Talk Your Way to Lower Bills: A quick call to your cable, home phone or Internet provider may uncover a new promotion that will save you big bucks. Some may provide a discount for going paperless or setting up auto pay, so ask what’s available or threaten to switch providers. Don’t forget you can save up to $50 per month by eliminating movie channels, streaming them for free on Hulu, or visiting your local library for free rentals.
5. Get a Side Hustle: The best way to pay down debt quicker is to bring more money in. Turn your passion into a side hustle through communities like Etsy, sites like elance.com or flexjobs.com, or by perusing opportunities in the “gigs” section of your local Craigslist.
6. Gather Your Tools: There are several apps available to help you offset your everyday spending. Use the Coupon Sherpa app to keep discounts with you at all times; download the Mint app to keep your budget within finger’s reach; and use ShopSavvy to easily compare prices on desired products.
7. Find Low or No-Cost Alternatives: You don’t have to spend loads of money to have fun or keep your routine. Avoid costly gym memberships by exercising outdoors or with inexpensive DVDs in your living room; hit up your city’s visitor center for a list of free things to do in your community; and cut down on your dining bill by visiting MrFreeStuff.com for a list of restaurants where kids eat free.
8. Splurge Occasionally: Incorporating small rewards and splurges into your budget is key to sticking to your goals long-term. Buying that pair of pumps you saved up for or picking up the occasional latte will keep you from feeling deprived.
9. Reward Yourself: Use rewards accrued on your credit card toward gift cards for yourself or others. Download the ShopKicks app to earn rewards as you run errands. Shop online using EBates or other cash-back sites to earn more as you spend.
10. Learn to Say No: Spending can get out of hand when we refuse to decline every invitation. Whether it’s a daily invitation for lunch with the coworkers or nine requests to be part of a wedding party, evaluate what’s most important to you and your budget and respond accordingly.
11. Find an Advocate: Sticking to a budget, paying down debt and avoiding frivolous spending can take a toll over time. Identify someone in your life whom you can all when things get tough. Make sure they know your financial goals so they can remind you what you’re working toward.
12. Clear Your Clutter for Cash: There’s no better time than the first of the year to clear out your clutter, and why not make some cash while you’re at it? Sell large items on Craigslist, exchange gift cards for cash using GiftCardGranny.com, sell old electronics at Gazelle.com, or sell unwanted clothing at likeTwice or a local consignment shop.
13. Go Generic: From food items to prescription medication, you can save over 30% when you go generic. Test food products to determine if the name brand is worth the cost, and always ask your doctor for available generic alternatives to medications.
14. Pay Yourself First: Saving money during the year will help you avoid financial ruin when unexpected emergencies pop up. Pay yourself first each pay period by setting up an automatic transfer between checking and savings.
Andrea Woroch is a nationally-recognized consumer and money-saving expert who helps consumers live on less without radically changing their lifestyles. From smart spending tips to personal finance advice, Andrea transforms everyday consumers into savvy shoppers. She has been featured among top news outlets such as Good Morning America, NBC’s Today, MSNBC, New York Times, Kiplinger Personal Finance, CNNMoney and many more. You can follow her on Twitter for daily savings advice and tips.
