We have all been told, at some point or another, that saving money on a regular basis is necessary to achieve financial fitness. In fact, savings is considered one of the components of a financially fit person. However, for some, even though you know that saving money is good, you often think to yourself, “How can I save, if I cannot even pay all my bills.” Many people find the idea of saving money virtually impossible, as there is normally more month than money. For many people, slight changes in habits can result in less money spent, or more money made, whereby more disposable income is created.
The purpose of this article is to identify just a few areas where small changes can be made, which can help to increase the amount of disposable income available in your household. In this article, we will discuss 10 easy ways to cut costs, which in turn will give you ideas to increase your cash flow. You can apply one of or many of these principles to your current lifestyle. With the increase in cash flow every month, there will be more money available, and so will give you an opportunity to put money aside as savings.
Option 1: Part Time Job
A very simple way to increase your cash flow is to take on a part time job. Consider working a few extra hours during the week, on weekends, or nowadays there are some virtual positions as well. Many people have a full time job, which typically consists of eight hours on the job, whether it be an 8am-5pm, 9am-6pm or some variation of this schedule. By exploring this second dimension of time through a part time job, you can also explore a second dimension of money.
Option 2: Start a Side Business
Another innovative way to increase your cash flow, which will increase your disposable income, is to start your own business. Think of something you love to do and have a talent for, for example, baking or wedding planning. Once you have found a business venture, be sure to let you friends and family know to start generating business. Also be sure to ask for referrals and to ask your friends and family to put your name out there for your new business. Of course this income may take a little while to build, but also keep in mind that with a small business, there are major tax benefits to be considered. Be sure to consult with your accountant to learn more about the tax benefits involved with starting a small business.
Option 3: Buy Generic Products
It is true that not all generic products match up to their brand name counter parts. For example generic toilet paper is sometimes very thin and so you end up using more, which means you spend more. In this case, buying a name brand toilet paper may be a financially savvy thing to do. However, there are many generic products that are just as good as their name brand counter parts, and choosing to purchase a generic version can lead to major savings. For example, purchasing generic prescription drugs and generic cleaning products can lead to huge savings. And these are just a few examples. Check your grocery store to see what other options are available. Keep in mind that changing some of your items can lead to savings anywhere between $300 and $1500 a year.
Option 4: Do Grocery Shopping with a Shopping List
Prior to visiting the grocery store, create a list of items that you need. Going to the grocery store with a list will keep you focused on the items you need, rather than just browsing up and down aisles. Often times in browsing, we will pick up items that we desire, rather than items that we need. The list will minimize this from happening.
Option 5: Use Coupons
Cutting coupons can be a time consuming activity. However, it is a great way to help you cut your grocery bill. Check your local grocery store, your newspaper, as well as online sites for coupons. A good way to keep your coupons organized is to have some type of folder where you can store them. Also be sure to keep track of your coupons, as most of them do have an expiration date.
Option 6: Carpool to Work
Another way to cut your monthly expenses is to participate in a carpooling program. Check with your local community, your neighbors or at your job to see if a carpooling program already exists. If a program has not been developed, think about starting one. This is a great way to cut your monthly gas bill.
Option 7: Have Extra Room in Your Home – Think About Renting It
If you do have some extra space in your house, such as an empty bedroom or empty basement, it may be a great idea to think about renting it. Of course, if you are a single mom, you want to make sure you are renting to someone you can trust. But if the right opportunity presents itself, this can be a great way to increase your monthly cash flow. Start asking around at work or even at church to see if anyone you know is looking for a roommate.
Option 8: Cook at Home and Take Your Lunch to Work
This is an excellent way to save money. Instead of buying your lunch during your lunch break at work every day, take a little bit of extra time in the morning or the evening before to prepare a lunch so you can take it to work with you. On average, to purchase a normal lunch from a restaurant can cost roughly $9, which preparing a meal at home can cost much less. Over a five day work week, this can add up to $45. Keep in mind: This is not to say you should not eat out at all, but it is a suggestion to cut back on the eating out and to take a prepared meal at least a few days out of the week. Over a period of a month, this can lead to significant savings.
Option 9: Make Your Own Coffee
Just like eating out regularly can add up very quickly, so can buying coffee on a regular basis. The cost of a cup of Starbucks coffee can range from $1.40 to $3.50, with some coffees costing more than this. Rather than purchasing this coffee everyday, a way to save money would be to make your own coffee at home, and perhaps buy a special coffee just one time per week.
Option 10: Pay Your Bills on Time – Avoid Late Fees
Whether it is a credit card, a car payment, or a house payment, most institutions have some type of late fee penalty if a payment is made after the payment deadline. Always do your best to pay your bills on time to avoid these fees. They can range anywhere from $25 to $35, and can be an unnecessary payment that you are making, and in turn losing this money. One way to avoid late fees is to have a calendar of when your bills are due. Perhaps stick it on the fridge, so you can be reminded on a daily basis when the bills are due.
Action Step for an Increasing My Cash Flow
The most important step for Increasing My Cash Flow is the Action Step. This is where you put into practice the knowledge you just acquired. The Action Step for Increasing My Cash Flow is to decide today that you will not go to bed without choosing 2 or 3 of these 10 steps, and implementing them immediately into your life.
Take immediate action. You may or may not see the results immediately. But don’t procrastinate on this process any longer. Most people never put a plan together, because they are waiting for the moment when they have the perfect plan. A plan, any plan, is better than no plan at all. And it is time to take action today. Spend time before you go to bed with your chosen 2 or 3 areas that you are going to apply immediately, in as much detail as possible. For example, you could decide you are going to carpool to work 4 days a week and take your lunches 4 days a week. Once you have chosen these 2 areas, now sit and calculate the amount of money you will be saving by participating in these two areas. Once you have calculated roughly how much you are going to be saving, then you should make the decision to find a financial professional who will help you begin the process of creating a savings plan and a plan of what to do with that extra money.
Create and follow a plan and start increasing your cash flow today to save more money!!!
Article by Lisa Sehannie