2 Ways To Decrease Your Living Expenses Without Sacrificing Convenience
Who doesn’t want spending money in their pocket and padded savings account as well? If you’re looking for ways to free up your cash flow so you can create some fun (and a little security), these tips are for you:
1. Avoid getting into more debt
One of the biggest causes for stifled cash flow is an unconscious cycle of continuously getting into debt. The world today primarily runs on credit, and credit is actually debt. If you’re used to relying on credit at every turn, and you’re not generating money from investments, your living expenses are already higher than they need to be.
Living on credit increases your living expenses
The more you live on credit, the more expensive it is for you to live. For instance, you think you’re getting a good deal at the store when you save two bucks on a dozen eggs. However, you could end up paying that much (or more) on the back end through interest and fees.
Calculate what you owe regarding hours of your life
By January 2015, U.S. consumers owed $884.8 billion in credit card debt. The average debt owed in 2015 was cited at $3,600 per person. If you’re working a job that pays you $20 per hour working 40 hours per week, it will take 4.5 weeks to pay that off. That’s 180 hours of toiling away just to break even.
The idea of getting into even a tiny bit more debt loses its appeal when you crunch the numbers regarding how much of your life you’ll need to trade to pay it off.
Not all debt is unnecessary
There are some necessities in life that you can’t avoid owing money on if you don’t have the funds to pay it off outright. For example, your mortgage and car are big-ticket items you’re probably still paying off. When you have expenses you can’t eliminate, do what you can to decrease the amount of money you have to spend each month.
For instance, many people have car payments that top $500 per month. That’s unnecessary considering you can purchase a new car for less than $200 per month. If your car payment is more than a couple hundred dollars, look into refinancing your current loan.
2. Buy some items in bulk
There’s a clearly divided opinion about whether buying in bulk saves you money or not. The truth is somewhere in the middle. Buying in bulk will save you money if you’ve got the patience to do the calculations. For instance, buying a 99-cent roll of house brand paper towels every few days seems like a better deal than shelling out $20 for a brand name pack of 10.
However, you get what you pay for, and the true cost makes itself known when you need to use five cheap paper towels to wipe up a small spill. With certain brand name products, that same spill could have been cleaned up with one paper towel.
Sometimes buying in bulk appears to be a good deal when it’s not.
Get ready to use extreme logic
Some of the calculations you’ll need to do aren’t necessarily mathematical in nature. Here’s an example:
Charmin is known for their toilet paper that comes in what they call “Mega rolls.” These rolls really do last longer than standard rolls. They’re bigger, and the paper is thicker, so you really don’t need to use as much.
The company recently came out with yet another size called “Super Mega.” These rolls are bigger than the Mega rolls, but when you compare them, the new rolls are only larger in width.
When you think about it logically, both the Mega and Super Mega rolls are likely to get used at the same rate because they have the same number of squares.
Will having a roll of toilet paper with wider squares really save you money? If people in your household can break the habit of grabbing a bunch off the roll, perhaps it’s a worthwhile buy. If you’ve got kids, you know it’s a losing battle.
Buying in bulk prevents impulse buys
Whenever you go to the store to pick up an item you ran out of, it’s tempting to wander and make a few more purchases. Buying in bulk prevents this from happening. If you’ve got a stash of dish soap for a year, you’ve automatically decreased your opportunity for making impulse purchases.