If you’re constantly wondering where your money is going, consider how much your daily habits are costing you.
Do you drop $10 to $15 on fast-casual lunches every day? Are you quick to buy something you don’t actually need? Do you make purchases to keep up with the same level of luxury your friends enjoy?
These seemingly small habits, and many more, could be keeping you from saving hundreds, even thousands, of dollars a year.
We turned to the Quora threads, “What habit has saved you the largest amount of money?” and “What are some lifestyle changes that save money?” to round up the best — and easiest — ways people save money every day.
Learn the difference between saving a dollar and saving a percentage.
Quora user Jaap Weel writes:
“Remember that saving 5% on a $10,000 item is not at all like saving 5% on a $10 item. But in order to process decision problems at different scales, the brain tends to normalize things so the two cases appear similar.
“Ever since I studied behavioral economics, I started spending less time worrying about saving 20 cents on spaghetti, but I spent a lot of time thinking about what car to buy and making sure I got a good deal on it. You can buy a lot of spaghetti for a $4k discount on a car, and yet I see people who spend lots of time on grocery coupon clipping but never stop to consider whether they could move to a cheaper apartment, drive a cheaper car, etc.”
Quora user Betsy Megas writes:
“I enjoy the challenge of learning new skills and the satisfaction of accomplishing tasks. Among the things I’ve gotten pretty good at: basic plumbing, interior painting, sewing, bike maintenance, baking, cooking. I’m still working on gardening, and I think I’d like to learn and improve basic construction skills (I’d like to build a deck or patio and repair some fences) and maybe learn about building PCs. Here again, I see it as both entertainment and expense avoidance. Occasionally also exercise.”
Practice delayed gratification.
“When you are shopping and your heart leaps at the sight of xyz product, and you think it’s love at first sight…WAIT. Save it, bookmark it. Come back to it hours later, then a day later, then days later and gauge, each time, how or whether your level of “pumpity-pump” interests stays the same, declines, etc. Never buy on impulse. Sleep on it. Ask yourself: Do you think it’ll make you happy a month from its purchase? A few months? A year? Years?”
Do a little math while you shop.
Quora user Raghav Mishra writes:
“Every time I’m out to buy something, I try to figure how much that amount of money would grow to in 5 years at a rate of 10% per year. That comes out to a little more than 60% return.
“E.g. if I were to buy something worth $1,000, I’d ask myself: Do I want this thing now, or would I rather have $1,600 in five years?
“Depending on what I’m planning to spend the $1,000 on — a guitar with specs that I need or a phone with specs that I don’t — I choose to buy or forgo.
“Usually, this approach has resulted in my saving the largest amount of money.”
Don’t overspend on status or allure.
Cut back on hanging out with lavish friends who do lavish things you don’t really enjoy. If you love skiing, go. But you don’t have to go to Aspen during Christmas week and stay at the St. Regis.
“Go off-peak, go for fewer days, and stay someplace cheaper — maybe with Starwood points. And if you’re a real skier, you shouldn’t be looking for a hot tub. You should be icing and popping Alleve. And you should be too tired to care about where you’re staying except that it’s fairly easy to get to the slopes and has a firm, comfortable bed. Stay at a cheap motel. Oh, and go to Alta. Don’t go to Aspen.”
Track your spending and set up automatic payments.
Quora user Colin Cahill writes:
“Make damned sure that you are doing online banking for every checking and savings account you have, as well as every credit card, loan, and investment. A good resource to tie everything together is Mint.com, which has been mentioned by some others. That is a good option, and will send you free alerts when you get low on funds, as well as give you an idea of your spending trends.
“Once you’re doing online banking on each of your accounts, set them up to make automatic payments. A lot of banks let you automatically pay bills, both to companies and to individuals. Take advantage of this — it is free and requires almost no effort. With Bank of America, my landlord automatically gets a check from Bill Pay on the 27th of every month, a few days before the 1st, and I never have to even think about rent.”
Prepare your meals ahead of time.
Quora user Zach Shefska writes:
“I eat the same lunch nearly every day. Bulk cooking meals is one of the easiest ways to save money, and relieve stress during the week.
“In addition to the cost per meal savings that I accumulate over the course of the year I also experience savings in the context of time.
“I spend about 2 hours on Sunday preparing my meals. During the week I avoid the stress associated with deciding what I want to eat, and I avoid wasting time waiting in lines or driving to restaurants.
“Where I currently work I know that I am billed at $125 an hour to our clients. Even if I only save 15 minutes of time each day (I think I save more relative to my co-workers who eat out), I would be creating an extra $31.25 in potential billable hours.
“I aspire to own my own business someday. If at that time I can bill at $125 an hour, and, I maintain my lunch prep which saves 15 minutes every Monday through Friday I will be able to create $7,500 in extra value.
“Preparing your lunch every day and not eating out could potentially help you generate $10,000 in savings each year.
“It’s simple. It’s easy. It saves you money.”
Know when to invest in quality products.
“Do NOT skimp on things that you use a lot, especially for productive/creative things or things that help you maintain those capacities (knives, computers, beds, work chairs, gym memberships). Yes, this is a way to save money. Conscious/unconscious workarounds for frequently used important things cost way more in the long run.”
Spend only the money you have.
“Listen to your debit card, not your credit card (it lies). I got used to living like I did in college before I was eligible for credit cards — if I didn’t have that total amount in my debit card, I couldn’t buy it. I keep that mentality today.
“Credit cards tempt you and trick you into thinking you have the money when you don’t. Before you know it, you’re stuck paying back debt, not to mention the horrible interest. Avoid paying any interest on, like, anything. If you already have debt with interest, that is your number 1 priority to get rid of.”
Cut yourself off at midnight.
Quora user Aksel Wannstrom writes:
“Having been a student for the past four year living of a meager income I have set myself a rule to never consume anything other than water after midnight.
“This has helped me reduced spending on all useless consumption goods. From alcohol at parties, to snacking at home. In a student life I just cannot see the NEED to ever consume drinks or foods after midnight as that is a time your body is essentially suppose to be asleep.
“This strategy doesn’t limit your experiences and social life trough college nor does it force you to live extremely frugally, it just reduces useless expenditure.”
Use the ‘5-question rule.’
“Want or a need? Do I need it? Do I see myself using it? How often? Is it worth the time?
“I make it a point to run by these questions every single time I’m buying something now, given that I earn to pay my rent and food.
“Coming from a family in India that is slightly above middle class, I took everything for granted. Bought food I wouldn’t eat, clothes I wouldn’t wear, art I didn’t adore, are some of the many things I splurged my (parents’) money on.”
Be happy with what you already have.
Quora user Thomas Antunez writes:
“Learn to want the things you already have. I’m dead serious. I owned 5 Porsches and 3 Mercedes-Benz (two AMG) before the age of 35. You can count those as the 8 biggest financial mistakes I’ve ever made and it all had to do with my inability to be content with what I already had.
“Believe me, possession of ‘things’ is a race no one can win. Learning to want the things you already have will save you an incredible amount of money