How I Trimmed $500 from My Monthly Budget in 4 Easy Steps

by Miranda Marquit · 16 comments

Most of us are looking for ways to trim the fat from our monthly budget. I recently refinanced my home, saving me about $300 a month, and that made me hungry for more savings.

So I decided to see if I could find $500 more to trim from my monthly budget — and I did. Here are the four simple steps I employed:

How to Save $500 Each Month

1. Ditch the subscriptions

My first step was to look through all of my subscriptions. I was receiving magazines that I didn’t even read, and I was also signed up for online access to a couple of sites. I looked through everything and realized I was paying about $65 per month in subscriptions. This was the easiest thing to cut, since I don’t use these publications anyway.

2. Ask yourself “why?”

The next thing I did was start asking myself a simple question. Too often, we buy things because they’re cheap, on sale, or because we think they might be “nice” to have. Simply stopping to ask yourself “why?” can head off a lot of mindless spending. I decided to do this before making any purchases for the month, and if I couldn’t come up with a cogent reason, I put it back.

I recorded how much each of these purchases would’ve cost, which was an eye-opening exercise. I didn’t realize how much impulse buying I did — even online — until I started asking this question. At the end of the month, the items I hadn’t bought totaled $205.

3. Comparison shop for recurring bills

It had been a while since I’d comparison shopped for insurance and some of my other recurring bills, including yard care. So I took an hour one day to look online and make a few calls. It wasn’t very difficult to call the satellite TV company and ask if I could get a cheaper package (I could), or find out that I could save money on my auto insurance by switching providers. In the end, I didn’t even need to switch, since my current auto insurance company matched the newer, lower quote. I also found a cheaper health insurance plan to meet my needs. That hour of comparison shopping on recurring bills saved me about $185.

4. Perform an energy audit

Another thing I did was go through and see how much energy I was wasting at home. A basic energy audit showed that with the help of smart strips, better planning with my thermostat, and different lightbulbs, I could save a good amount of money. After making a few energy-efficient changes, my latest bill is about $55 lower than last month’s. When taking into account that it’s still summer, that’s a big savings.

These simple steps can lead to big savings over time. Have you recently found a new way to trim your budget? 

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{ read the comments below or add one }

  • CME Capital Australia says:

    Agree with these tips and been doing this strategy for 5 years – it works!

  • Rey says:

    Does anybody have any luck getting charter & att wireless to lower their bill. I have tried but had no luck.


  • Alex @ Credit Card Xpo says:

    I saved $60/month by cutting my cable TV subscription. Since most of the channels I watch are public broadcasting, I bought a digital TV antenna and get those channels in HD for free!

  • Syed says:

    Great post. Cutting expenses and turning that into savings/investments is the most powerful thing you can do for your finances. It keeps lifestyle inflation in check while increasing your net worth even faster.

    Shopping auto insurance was a big win for me a few months ago as I ended up saving about $100 a month by switching. This is something everyone should do every year or so.

    • David @ says:

      Auto insurance is definitely an area we should look at regularly, especially since Miranda experience of the existing insurance company matching the new, lower offer, is so common!

  • Jon @ Penny Thots says:

    We performed an energy audit and saved a nice chunk of money. I am currently looking at adding insulation to our attic to help our heating and cooling costs in the upcoming years.

    It’s also amazing at how much you can save when you look at the little things, like subscriptions. We cut out about 5 magazines we were getting and saved a good bit of money there.

    • David @ says:

      And the energy audit doesn’t just benefit your wallet I bet, as I’m sure you were able to make sure every room in the house is just as warm (or cool) when needed.

      Well done Jon!

  • Andrew says:

    These small saving makes a lot in the long run of life. We should be very tentative towards these savings. Any one can manage it by decreasing his extra expenses that are not too much necessary. Just manage your budget in the start of month and by following so you can easily do this.

    • David @ says:

      You are right. Focus on the compounding and long term effects of each expense and you’ll do awesome in the long run!

  • Gretchen says:

    The energy audit is high on our to do list right now, since we’ve trimmed just about everywhere else. We’re considering putting extra insulation in the ceiling and in the basement, re-caulking our windows, and looking for ways to save water. They might not add up to $500 each month, but it’s something, especially as hot as this summer is!

    • David @ says:

      Do it today, or at the very least, this weekend Gretchen! The longer you wait, the more $$$ you are throwing down the drain!

  • G says:

    I changed my cell phone plan – a reduction of $35/mth
    I bought a CNG car for commute – saved $150/mth in gas bills. In two and half years that pays for the car and insurance. Hopefully I dont run into major problems.
    I switched daycare and get more help for lesser amount – $350/mth
    I changed all bulbs to energy saving, and in comparison to what my neighbour pays it is an average of $100/mth savings.

    • David @ says:

      $635 a month is awesome. That’s $7620 a year, banked, can be the difference between scraping by and living a comfortable retirement!

  • Michelle says:

    We recently had someone check out our toilets for water efficiency and our AC for usage. It turned out that both were using a crazy amount. The toilets were fixed and are no longer running all day (we had no idea that they were), and the AC was fixed and we were told it was running at max capacity for years.

    • David @ says:

      Wow thanks for the heads up Michelle. I didn’t know that an A/C could be broken to a point where air was still coming out and using much more energy than it should. I wonder how much money is being wasted in our country just from this single problem!

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