8 Tips To Help You Save $1,000 Every Month in 2023
Saving money can be tough these days. It seems everything is so expensive, which can make it challenging to get ahead. But saving money doesn’t have to be an uphill battle.
Discover: 4 Reasons You Should Cancel Amazon Prime
Read More: 3 Ways Smart People Save Money When Filing Their Taxes
See the List: GOBankingRates’ Best Banks of 2023
Saving money should also be a priority — as much as 40% of Americans have less than $300 in savings. Fortunately, saving $1,000 per month is possible without making significant changes. There’s no need to be an extreme coupon-er or resort to cutting your own hair.
Of course, saving $1,000 per month may not be possible if you have a very limited income. In that case, you can pick a goal that matches your salary, even if it is just an extra $100 per month. Here are some ideas to get you started.
Budget, Budget, Budget
You have probably heard it many times, but that’s because starting a budget is an essential part of saving money. If you don’t know where your money is going, it will be difficult to direct some of it into a savings fund.
So if you don’t already have a budget, consider starting with this step. There are many popular budgeting methods, such as the 50/30/20 method. With this style, 50% of your money goes to needs, 30% goes to wants, and 20% goes to savings. However, there are also many alternative methods that may suit your situation better.
Separate Wants and Needs
The first step above is to start a budget, and we touched on a budgeting method that separates wants and needs. One problem is that the line between wants and needs is becoming increasingly blurred.
For instance, some subscriptions can feel like a need, but is that really true? Try going without one for a month and see how it changes things for you. If the difference is small or there’s no difference at all, you likely have a want and not a need.
Take Our Poll: How Do You Think the Economy Will Perform in 2023?
Get Out of Debt
This list might be about saving money, but you can’t completely forget about your debt. That is especially true if you have significant high-interest debt like credit card balances.
For example, suppose you have $5,000 in credit card balances with 19% APR. If you pay the card off in 12 months, you would incur $440 in interest. And that is assuming you pay the card off — if you aren’t making your payments or just paying the minimum, you’ll end up with even more interest. High-interest debt can crush your money-saving dreams, so be sure to take care of it sooner than later.
Automate Your Savings
Many savings accounts will let you set up automatic monthly contributions. While that is convenient, it can also make it easier to reach your goal.
Since your savings is happening in the background, you won’t be tempted to spend it on one of those pesky wants we talked about. Online savings accounts let you save the precise amount you want each month, so this works for all incomes.
Try a Money-Saving Challenge
Money-saving challenges are numerous online. However, one that is especially common is the type where you consistently increase the size of the contribution.
For example, consider one in which you save $25 the first month and increase your contributions by $25 more each month. By month 12, you would be saving $300 per month. While that doesn’t quite get you to $1,000, it gets you a good part of the way there on its own.
Reduce Your Transportation Costs
While changing how you get around might be difficult, think about how you might be able to reduce your transportation costs. For most Americans, the biggest three expenses are housing, transportation and food, usually in that order. The difficulty of making changes to these expenses also tends to go in that order, so this tip won’t work for everyone. However, reducing your transportation costs can go a long way.
Depending on your situation, perhaps you can work remotely, eliminating the need for two family cars. Take public transit if possible. Or, if you live in a bikable city, you can try biking to work — electric bikes or eBikes make that easier than ever. When you do buy a car, consider used if you find those options cheaper.
Switch to Cheaper Insurance
Shopping around for insurance can make a big difference. Every insurer is different and has their own unique way of setting rates. Insurance is very complex, which means your rate at one carrier could be quite different from your rate at another. Instead of renewing your insurance every time you are up for renewal, get a few quotes from other companies.
Insurance comparison websites make it easy to compare, so it should only take a few minutes to find out if switching would save you money.
Improve Your Home’s Energy Efficiency
Energy efficiency is a bigger deal than you might realize, especially if you life somewhere that gets very hot or very cold. Depending on your budget, you could opt for something that costs a lot of front, such as solar panels or a heat pump. While these are expensive, they can save you money in the long run.
However, you might prefer to save money more in the near term. If that is the case, you can opt for a much simpler option, like using caulk to seal air ducts. According to the EPA, this project takes 1-2 hours to complete, $3 to $30, and is easy to do. Best of all, it can save you 10% to 20% every year on energy costs.
More From GOBankingRates