Tell me, do you know how to cut monthly expenses & save money? Do you often run out of money before the end of the month? Do you scratch your head and wonder where your money went? Do you struggle to find money to invest for retirement, emergencies, and other financial goals?

If these are some of the questions you have been asking yourself, you’re not alone.

In fact, a 2017 report by MarketWatch found that half of the American households currently live paycheck to paycheck.

The report also revealed that 19% have $0 saved to cover emergency expenses, and 31% have less than $500 in emergency savings.

Most of us try to cut spending but often fail, and is not because we’re not cutting enough, is because we’re not consistently cutting each month.

Another problem is that we’re not keeping track of what we’re saving from cutting those expenses, so in reality, we’re not seeing real results that can be used as the fuel to keep us going.

If you want to know how to drastically cut expenses, here are 7 simple ways to cut monthly expenses (cost-cutting hacks) and save more money, every single month!

1. Eliminate your home telephone line.

Unless you have a house alarm connected to the local police department, you don’t need a home telephone line.

Just about everyone these days has a cell phone, and most likely with unlimited everything, so there’s really no need to throw away $30 or more monthly on something that you don’t need, and most likely never use.

A few years when we purchased our home, we signed up with Comcast for a promo package they had in our area that included a house landline.

We knew we didn’t need it, and even worst, we never even bought a telephone to connect it to that line!

3 years later when we decided to change our cable provider, we realized that we threw away over $1,000 plus taxes and fees on a telephone line that we never used.

With that money, we could have increased our 401k contribution, or stashed it away in our savings, bought stocks, etc.

Basically, we could have done anything with that money, instead of throwing it away.

2. Cut back on Starbucks or other premium coffee shops.

This one is going to hit a nerve with a lot of people.

On one side you have those that believe Ramit Sethi’s thinking, which is to splurge on what you love (such as premium coffee) and cut brutally on what you hate or don’t need.

On the other side, you have folks (like myself) that believe in the concept of the “Latte Factor”, coined by New York Times Best Selling Author David Bach.

In his book, The Automatic Millionaire, David explains that if you calculate how many times per week you drink premium coffee such as Starbucks, multiply that by the cost of each cup, times 4 weeks, then times 12 months, you will go bananas when you realize how much money you’re spending on coffee in a year.

David Bach suggests that instead, you should invest that money on index funds, or dividend-paying stocks, or REITs, or basically anything that will allow you to use the power of compound interest to grow your money over time.

I used to buy the Caramel Macchiato from Starbucks 3-4 times per week ($3.75), so for me that was between $11.25 – $15.00 weekly, or $45 – $60 monthly, or $540 – $750 annually.

When I realized how much moneyh I was throwing away on coffee, I stopped, increased my 401k allocation at work, and now I make a fresh pot of coffee at home before leaving for work and still get to enjoy a FREE cup (or 5) of coffee at work.

Whether you decide to go with Ramit Sethi or David Bach, be sure you track how much your daily habits are costing you, so you can decide if is worth it for you or not.

NOTE: David Bach’s philosophy will save you money and lots of calories 🙂

3. Switch your mortgage payments to bi-weekly instead of monthly.

Here’s a concept that when I first read about it on NerdWallet, I couldn’t believe how simple it is and what the long-term benefits are.

The article, Should You Make Biweekly Mortgage Payments? compares the differences between paying monthly and paying bi-weekly.

Essentially,  when you switch from making monthly to bi-weekly payments, you actually pay less interest and pay off your mortgage faster.

Here’s an excerpt from the article:

If you pay your mortgage monthly, like most homeowners, you’re making 12 payments a year. When you enroll in a biweekly payment program, you’re paying half your monthly amount once every two weeks instead.

There are 52 weeks in a year, so this works out to 26 biweekly payments — or, in effect, 13 monthly payments.

“Because you’re making the equivalent of 13 monthly payments each year, you’ll pay less total interest while lowering your principal balance at a much quicker pace,” says Joe Zeibert, senior director of Ally Home, a division of Ally Bank in Charlotte, North Carolina.

Zeibert gives the example of a 30-year fixed loan of $250,000 at a 4% interest rate. “Biweekly payments would save a borrower nearly $30,000 in interest charges and have the loan paid off in five fewer years,” he says.

Even if homeowners stayed in their home for only seven years, they would still save several thousand dollars in interest charges while paying off $10,000 more in principal, which they could then use toward a larger down payment on their next home, Zeibert says.

Now, if you don’t see the tremendous value in switching from monthly to bi-weekly mortgage payments, you need to go back and read the article one more time.

4. Carry cash instead of credit cards.

Despite what many might believe, psychologically it’s harder to spend cash than it is to use a credit card.

Pulling out your credit card is easier, quicker, and with higher limits, using your credit card puts you one swipe away from mounting debt.

Don’t get me wrong, everyone should have at least 1 credit card for emergency purposes and for big purchases, but I also strongly recommend using it ONLY if you have enough cash to pay the balance before you start accumulating interest.

So, if you need to make a big purchase at the beginning of the month, go ahead and use your credit card, just be sure to pay it off by the end of the month.

BONUS: Using cash instead of a credit card will help you spend less, and thus save on interest charges.

5. Use the “envelope system” for groceries, dining out, entertainment, etc.

Have you ever been in a meeting without an agenda and dragged on forever?

I have, and the reason is that when you don’t have clear objectives in mind, there’s really nothing to measure.

When it comes to personal finance if you approach it vaguely without specifying, how do you know if you’re on track to meet your financial goals or not?

In other words, if you go do groceries without a budget in mind, you’re going to end up spending more than you really need.

Let’s say your budget for groceries is $100 weekly, you can prioritize what you REALLY need, and whatever is leftover, you can use it on the things that you really don’t need, but want.

Personal finance is about making decisions that either have a positive impact or a negative impact.

The decision ultimately falls on you, so have a plan in place and execute that plan.

6. Buy regular gas instead of premium.

Some vehicles like a Corvette or an expensive car function better with premium gas, but the reality is that you really don’t need to use premium, regular gas is just fine.

If you remember a bunch of years ago when ethanol was added to all fuels in order to reduce the price of fuel, well, ethanol is still being used and the price of fuel hasn’t really gone down.

So, why would you pay more for gas?

ok…sorry for ranting…back to saving you some moneeeyyy!

7. Take a vacation at home.

huh! What I mean is, instead of spending hundreds and in my case, thousands of dollars to go to Disney, find local fun things to do in your area and save some money.

For me, instead of going to Disney, I can just drive to the keys and spend a weekend down there fishing with the kids and relaxing in the sun.

Look on Groupon for deals in vacation rentals, fishing excursions like the glass bottom, etc.

You’ll be amazed at all the cool things in your own area, and even more amazed at how much money you can save on travel and hotel.

BONUS TIP

An interesting one I discovered is buying your own modem instead of renting the one that your cable provider lends you.

Do you know how much you’re spending monthly on equipment rental?

In my house we had 5 devices, so we were spending roughly about $45/month just on equipment rental. 

The same equipment we were able to buy on Amazon, send the other equipment back to Comcast, and after 3 months we got that money back in monthly savings.

These are just a few simple ways you can use right now to help you cut everyday expenses, be sure to keep a fixed expenses list and a variable expenses list as part of your monthly budget list.

If you have any suggestions, please share them in the comments section below, I’m always looking for ways to keep cutting my expenses…and I’m sure someone in our community would really appreciate your inputs.

DISCLAIMER: This post may contain affiliate links to products and services, for more information please review our Affiliate Disclaimer page.