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Are you finding yourself thinking about your finances more often? If so, you're not alone. Canadians spend an average of 2 hours a day worrying about their finances, according to the 2019 Scotiabank Investment Poll.
Check out our list of tips on how to cut your expenses to help you boost your savings.
1. Create a budget
If you're looking for ways to cut expenses from your monthly bills, you first need to have an idea of how much you're actually spending. Your budget doesn't have to be complicated, you just need to know how much money is coming in and how much is going out.
When you calculate how much money is going out, break your expenses into two categories:
- Fixed expenses - these are the bills that remain consistent each week, month or year. Things like your rent or mortgage, car payments, and insurance.
- Variable expenses- these are the bills that change over time. Things like how much you spend on groceries or shopping for clothes.
Because your fixed expenses stay the same over time, they're easy to account for, but often more difficult to cut back on. On the other hand, your variable expenses fluctuate over time and, as a result, you often have more control over how much you spend.
With a clear idea of how much money you have to work with each month, you can start to evaluate your fix and variable expenses, see where you can cut or reduce some expenses and boost your savings.
2. Take inventory of your subscriptions
Subscription services are one of the areas where you can probably save some money. Because most subscriptions auto-renew from month to month, it's easy to forget how many services you might be subscribed to.
If your goal right now is to save as much money as possible, review your bank and credit card statements and take inventory of how many services you're paying for. This includes things like streaming service (Netflix, Hulu, Spotify), as well as subscription boxes and even your monthly gym membership.
Next, cancel any subscriptions or memberships that you think you can live without. This isn't necessarily goodbye forever, just until you feel more confident about your financial situation. Moving forward, you can use apps like Butter, a subscription tracking app, to help you keep track of your spending.
3. Look at your internet, cable and cell phone bills
Where can you cut back? If you have cable, think about how often a week you are using it and what channels are your favourites. You might be able to get a smaller package to include your top picks.
Assess your cell phone needs. Can you give up a few GB of data? Can you go onto a shared plan to reduce your monthly bill? Can you switch to another provider if they're offering a more affordable plan? Another thing you can do is call your cell phone provider to see if they can offer you a more affordable option.
4. Eat at home effectively
Ordering in meals at home is a great treat but having most of your meals delivered can add up quickly. If you don't know how to cook, use this as an opportunity to learn. There are great free cooking apps you can try, like BBC Good Food, Good Oven and Food Network Kitchen. When you go shopping, always bring a list so you don’t buy more than you need and opt for no-name brand options if you really want to maximize your savings. There can also be affordable meal kits available at your local grocery store to test out your cooking skills.
5. Participate in a no-spend weekend
While this might not sound like a ton of fun, it's a fast and simple way to save money. Don't spend money on anything that isn't considered essential. No online shopping or ordering in. Instead, you can use your imagination and get creative when it comes to deciding how to have fun without spending money, go for a longer hike, bust out your art supplies and make it an at-home movie marathon fest.
Take action and start saving money
Making small changes can make a big impact on helping you cut back on your monthly expenses. With a little bit of creativity and effort, you can put money back in your pockets and hopefully reduce some of your financial worries.
If you have questions about finding a budget that works for you, get in touch with your financial advisor.
