In the first quarter of 2021, household debt in the United States was reported to be $14.6 trillion, which seems like a lot of debt.
If you are trying to add more money to your budget, you might want to start by evaluating your monthly expenses?
However, cutting expenses is the hard part, but it is definitely not impossible. Making small changes on things from groceries to homeowners’ insurance can help. Certain items like rent, mortgage, and car payments demand more legwork but will give you a bigger budget boost. Here are a few ways to lower your monthly bills.
Find Cheaper Alternatives
Perhaps, a good way to start saving money is by finding cheaper alternatives for cable TV, internet/cell phone service, and more.
If you shop around, you will find many suppliers out there, making it easy to cut your monthly cable TV, cell phone, and broadband bills. So, consider calling your supplier and asking for a better price. Negotiate, keeping in mind that you are in charge. You could also use a comparison website to find a cheaper deal. As a rule of thumb, you want to try matching your contract to your requirements. For instance, if you use a lot of data and are charged extra when you go over, a deal that comes with more data might be ideal.
Gym Membership or Home Workouts?
Most people have monthly subscriptions for gym memberships. Once you set one up, you will likely think about it a lot, yet the money goes out of your account every month. While research proves that a gym membership is associated with 14 times higher odds of meeting weekly physical activity guidelines, with little determination, you could achieve the same results with home workouts.
Take a close look at your gym membership, and ask yourself:
- How much do you use it?
- Do you really need it?
- Could you get away with home workouts?
Home workouts can be a good alternative to gym memberships. Furthermore, several apps are available in the market that come with a wide array of workout sessions and goal customization options.
However, if you feel that gym memberships are necessary, consider looking for deals online at Groupon and LivingSocial. Additionally, buying a 10-visit pass, buying in bulk, or going for a two-year contract will help you land a lower monthly bill.
Credit Cards And Loans
Perhaps, one of the biggest challenges to cutting expenses is the credit card debt and loan repayments. When you don’t have money on hand, it is easy to use your credit card or get a payday loan. However, the balances grow fast, especially with a high-interest rate. Here are a list of online payday lenders.
If you are currently in credit card debt, freezing your cards for some time will help you cut monthly expenses. A few financial experts also suggest putting your card in a container of water and freezing them. So, when you want to use it, you will have to thaw it out.
If you wish to do it the official way, temporarily stop credit cards by having your issuer freeze them. The issuer will not authorize new charges then. And the recurring payments you have set up will continue to be processed. But remember that you will still be paying monthly installments, and the interest will continue to accrue.
You can “thaw out” the cards at any time, and you will be charged no penalty. The faster you get rid of the debt, the more money you will have in your monthly budget.
Save First, Spend Later
Right after you get your paycheck, the first thing you should do is pay yourself. This is a sure way to attain financial freedom early. Consider using the 50/30/20 rule or any other rule of your choice for budgeting. The former means that you use 50 percent of your take-home pay for your needs (bills, food, debt payments, etc.), 30 percent for fun (dining out, entertainment, etc.), and the remaining 20 percent is saved for the future. If money is tight, you can adjust the ratios by yourself.
There is no better time to reduce your monthly bills than now. All you got to do is take one step at a time to make it more manageable, and you will be surprised at how quickly you will get to see the results.
If you are too serious about getting your finances in line, consider seeking help from a credit counselor, who will help you create a budget as well as help you with getting credit card bills down. You can also get into a debt management program to get help with budgeting and reducing credit card payments.