If you could save $10,000 in one year without sleeping in your car or living on Ramen noodles would you give it a try? How much savings is actually made will vary from family to family but after calculating what the average family spends on most items, the savings could add up to over $10,000 in one year.
1. Eat at Home
The amount of money we spend on take-out and restaurant meals each year is staggering. Last year the Daily Mail reported that the average American spends $900 annually on take-out. Planning out meals, buying food in bulk, and eating entirely at home for one year will save the family an estimated $3,000.
2. Ditch the Department Store
It’s amazing how a sweater that a child in India will be lucky to get a dollar to make is still worth only a few dollars after you wear it once and stick it in your garage sale. But between these stops it’s worth $100 on a fancy mannequin in a department store? The Goodwill and the Salvation Army are a few places to find quality clothing at next to nothing prices. Give up the mall and department stores for one year and the average family will save about $2,000.
3. Scale Back on Birthday and Holiday Spending
This doesn’t mean we shouldn’t celebrate holidays and special events. Not spending as much money may even help us to appreciate the true meaning of holidays. The average family spends $750 on Christmas gifts annually. Add in birthday parties and gifts throughout the year and the number goes up to about $1,000.
4. Do Your Own Beauty Treatments
Give up the facials, manicures, spray tans, waxing, and eyebrow design. Most of these things you can do yourself at home with products from your local drugstore for a fraction of the cost. Most of us would save around $500 a year by skipping the salon.
5. Give up Vacations for a Year
This doesn’t mean you shouldn’t take a relaxing break from work, just that it isn’t necessary to drop thousands of dollars every year for flights and hotel rooms. Plan a shorter vacation closer to home or visit relatives you haven’t seen in years. In 2010 an American Express survey stated that the average family would spend about $4,000 on a summer vacation.
6. Cut Back on Car Insurance
If your car is paid off consider purchasing only liability insurance. You may also want to raise your deductable. Doing each of these things could save up to $500 a year.
7. Disconnect Your Landline
Every year more people are canceling their landline service and using only a cell phone. Eliminating this monthly bill and the sometimes hidden fees that come along with it can add up to substantial savings. Most landlines cost between $25 and $30 a month. This comes to about $300 each year.
8. Become a Teetotaler
While there are health benefits of drinking in moderation, buying even a six pack of beer or a bottle of wine each week can make a big dent in your budget. The average American family spends about $500 on alcohol.
9. Skip the Lottery Tickets
It’s estimated that low income families spend approximately 9 percent of their income on lottery tickets each year. This comes to $645. While middle class Americans might not spend that much, spending anything is too much when you consider the odds of ever winning more money than you spend in tickets is overwhelmingly not in your favor.
10. Get Rid of Cable, Movies, and Expensive Entertainment
With the price of an average movie ticket close to $10, a couple that visits the movie theater once a week for a year will spend over a $1,000. Add popcorn, candy, and a couple of kids and the costs rise dramatically. Cable costs vary, but it’s not unusual to pay $100 per month for cable. Pick a few good movies to go to each year and check out the rest at the public library for free. There are other items we often pay too much for that fall under the category of entertainment and recreation, such as concerts, sporting events, and gym memberships. Go jogging and bike riding in the park for exercise and enjoy the free concerts most cities promote during the summer months. Altogether the average American family spends about $2,000 each year on movies, cable, and other forms of entertainment.
While all of the above doesn’t apply to everyone and cutting back on all 10 may not be realistic, most of us have several items on the list we could definitely reduce or do away with entirely. Realizing that an extra $5,000 to $10,000 each year could be spent on paying off the mortgage, saving for retirement, or put toward a college education, may be enough inspiration to make all of us jump on the frugal bandwagon.