How to Easily Save $500 a Month Without Changing Your Lifestyle

Saving money doesn’t have to hurt. You can live the same lifestyle and easily save at least $100 a month, and I will argue, save $500 or more without making major changes to the way you live. It’s all about doing the occasional expense review. What is an expense review? It’s taking the time to review your statements to see what you can cut out, cut back on, and negotiate your way to save without affecting your life.

Do a regular expense review

Set aside a monthly or quarterly expense review in your calendar for one hour. I always say if it’s not in your calendar it’s not real. Pull up your bank statements and your credit card statements and review each month to see which expenses are recurring that you can either cut out, cancel, or negotiate on.  I saved $500 a month by doing this and it only took 30 minutes of my time to review my expenses and another 30 minutes to pick up the phone. Here are ten tips:

1. Cut out subscriptions that aren’t being used

You’re looking for ANY subscriptions that show up on your bank statements:

  • Cell phone
  • Online gaming (games, PSN, Xbox Live, etc.)
  • Software
  • Magazines and newspapers
  • Music
  • Online storage
  • Cable and internet
  • Gym
  • Fitness studios
  • Delivery

I took a look at my credit card statements over three months and noted which expenses kept reoccurring. What did I notice? I was paying for both Spotify ($9.99 a month) and Apple Music ($9.99 a month). Why did I need both? I cancelled Spotify and saved myself $9.99 a month off the bat.

The next thing I saw was that for my news I was paying for both a Globe and Mail subscription and a Wallstreet Journal subscription. While I love reading the news, I figure I valued Canadian local news more, and cancelled my WSJ sub, saving around $50 a month.

I then cancelled my PlayStation Plus subscription. I noticed I wasn’t playing online as much anymore. That was another $6 a month in savings.

Savings per year = $72

2. Cut back on annual fee credit cards

I opened my wallet and saw that I had two annual fee credit cards. To determine if I need both I first looked up the number of points I was earning and saw that I could only justify having one annual fee credit card while earning enough points to more than offset the annual fee. I cancelled that card that earned me fewer points and kept the other, saving the equivalent of $10 a month.

Savings per year = $120

For more on credit cards, see the Top Canadian Travel Reward Credit Cards and Top American Travel Reward Credit Cards.

3. Negotiate on other subscriptions

After cancelling my WSJ subscription, I called up Globe and Mail and told them I was thinking of cancelling. Before you know it they have their Client Retainment Guy on the phone and offered me a $15 a month cheaper subscription. I said I would have to think about it. They countered with a plan that was another $5 cheaper, so all in all, I was saving $20 a month on my plan.

Savings per year = $240

For more on negotiating, see The Negotiating Technique That Can Change Your Life.

4. Shop around for car insurance

I was paying $250 a month for car insurance (don’t ask why; I am accident free with a 2013 Honda Civic). I thought that was a bit much and my insurance was going up each year when I had no accidents on my record. I shopped around and was able to easily find a plan that was not only $100 cheaper a month, they also had better coverage.

I recommend lowestrates.ca.

Savings per year = $1200

5. Negotiate home internet

My one year subsidized home internet plan was expiring so I would have to pay full price for my internet the following month (which was 5x the price). I called up my provider and said I was thinking of joining their competitor because they had a compelling intro offer for new customers. Not wanting to lose a customer, they came back with a plan I couldn’t refuse with double the speed I was at and half the cost! Right there was another $40 a month in savings. Now you may not get a deal that easy, in that case if they say they can’t help you then ask for their supervisor and see if they can do anything for you.

If you’re an American you can easily comparison shop by using allconnect or My Rate Plan. If you’re Canadian I recommend comparemyrates.ca.

Savings per year = $480

6. Negotiate cell phone plans

I am not currently locked in a plan so I have a lot of flexibility on who I use for my cell phone provider and I use this to my advantage. I called up my provider and said times were tough and I was thinking of going to a cheaper competitor (see a theme here?). They offered to give me an extra 5GB a month in data (I didn’t save on my plan but I got more data!).

Savings per year = $0 (but I have more data which saves me money when travelling)

For more on negotiating, see The Negotiating Technique That Can Change Your Life.

7. Change bank accounts

These days it’s easy to have a no-fee chequing account. For my bank, I was paying $15 a month. I reviewed my average transactions per month and realized I could get away with their free account and not pay more in extra fees. The moment I noticed that I called up my bank and switched my bank account over. Furthermore, because I have an emergency fund saved up, I asked them to remove my overdraft protection which was another $5 a month in savings. I recommend bankrate.com to compare accounts.

Savings per year = $240

For more on bank accounts, see the Best High-Yield Savings Accounts in Canada or Best High-Yield Savings Accounts in the U.S.

8. Change a habit

This is not going to be a post about how to cut back on lattes. Drink all the lattes you want. Just be aware of how much you are spending and if there’s a better way of doing it. For example, you can buy Starbucks syrup and make your own London Fogs at home. Or do what I do, which is substituting my morning coffee routine with an office coffee and saving my afternoon latte as a treat for myself. I save $4 a day by changing my coffee drinking habit. It does not have to be coffee. Review what habits you can tweak without making a big impact on your life.

Savings per year = $960

9. Bundle services

If you have multiple banking products with your bank, they may offer discounts on annual fee credit cards or lower or waive your chequing account fee. You can do this often with insurance by having your homeowner’s insurance and car insurance with the same provider, and also with your home internet, TV, and cell phone bundles. I combined my car insurance with my home insurance provider and save $20 a month off my homeowners insurance.

Savings per year = $240

10. Take advantage of corporate discounts

Your employer can be a large source of discounts. My employer for example receives discounts off of Apple products, Dell, movie tickets, zoo tickets, and more. Usually this would be found in the HR section of your company’s inter-web. Or you can ask someone in HR what benefits you receive with your job.

While it’s not a subscription per se, I like to go to the movies and other shows at least once per month and buy them through my Company’s discount program. I save $20 a month doing this.

Savings per year = $240

Summary

If I add up my savings per year it would look like this:

  • Music = $120
  • News subscriptions = $840
  • Car insurance = $3,000
  • Online gaming savings = $72
  • Home internet = $480
  • Cell phone plan = $0 (+ 5 GB data)
  • Switching bank account = $180
  • Changing my coffee habit = $960
  • Bundling services = $240
  • Corporate discounts = $240

Total yearly savings = $6,132!

If you were to save that amount and invest it in S&P 500 index fund, that $6,132 per year would turn into over $1 million over 30 years. That is the beauty of compound interest and how cutting out, cutting back on, and negotiating your expenses can go a long way over time.

For more on investing, check out Why a Single Investment Can Be All You Need to Retire.

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