We’ve been mentioning in our blog posts a lot about making lifestyle changes to help lower your long term cost structure and help you save money, but we haven’t actually produced a list of the top ways to do this.
This post is exactly that! A list of things you can do long term to help you get your budget in order and maximize your monthly and annual savings. Our way of thinking is pretty straightforward in this. You start with your biggest expenses and then find ways to lower them. While many of these expenses can’t be lowered right away, by planning for the long term you can make sure that future costs are well within your means.
1. Start By Optimizing Your Housing Costs. You can’t lower your housing costs instantly, but you can over the long run. You must first determine if the amount of money you are spending on housing is within your means. Generally speaking, your rent or mortgage payment shouldn’t be more than 30% of your income. If you want to live below your means and save even more money, you should shoot for a figure closer to 20%. Look at how much you are spending on your rent and mortgage, and if it is in this range then you should optimize it by making sure you have financed it at the lowest rate possible. If you are spending more than 30% on your home, then you should look into moving.
Moving is a lifestyle change that is hard to commit to, a lot of work, and very time consuming. However, the long term rewards can be outstanding. If you need to cut your housing costs and you are a renter, moving is much easier. If you need to sell your house and find a new one, it gets tougher. Besides the overall cost of your house or apartment, you should try to optimize all of the costs that go along with the house. Finding an area with lower property taxes can help. Also, consider moving close to work so that you can save on commuting costs and perhaps get rid of a car. Also, look into the efficiency of the house to make sure that it is designed and optimized to help lower utility bills and maintenance costs. A newer house is sometimes less expensive over the long run as compared to a house that is reaching its maintenance peak (a house about 20 years old).
2. Reduce Your Carbon Footprint and Save Money. You don’t have to be a hippie to want to reduce your carbon footprint. The beauty of it all is that almost every reduction you make to your carbon footprint can save you money. Here is a list of the top ways to reduce your carbon footprint and save money.
- Make sure your house is properly insulated and sealed. Heating and AC bills can be cut by 25% or more for an energy efficient house.
- Start buying energy efficient appliances, water saving technologies, and low watt lighting replacements. Don’t buy them until your old one’s wear out.
- Recycle everything that you can. Whether its selling your stuff on craigslist or through garage sales, you can make money recycling.
- Reuse stuff. Obtain used products from craigslist and even repurpose old stuff for new uses.
- Start buying more energy efficient cars. Hyrbids don’t always make financial sense, but a car with good mileage probably does.
- Move close to work, or work close to home. Walking, carpooling or taking public transportation saves gas. Consider getting rid of one of your cars.
- Compost your organic waste and start a garden. Use the compost in your garden and use your garden to save you money on food.
- Drive in a manner that you can save money on gas.
3. Slowly Change Your Eating Habits. Changing your eating habits over time can also help. Working in more vegetarian meals can be less expensive, add variety, and is sometimes more healthy. Learn how to eat healthy for less. You don’t have to stop eating out, but the restaurants you eat at can make a big difference in the costs. Also, if you are used to ordering a soft drink and dessert with each meal, consider skipping them and having dessert at home for a fraction of the cost. Start getting more serious about finding ways to save money on groceries and other food costs. Even consider bringing your own lunch to work. Food is a major expense each month, especially for families with kids. Making these changes slowly over time will help you stay comfortable and make it easier to make the transition. When it comes to eating, there are so many options out there that can have a financial impact. Keep looking and doing it and you will get better and better.
4. Do Things Yourself. The most expensive part about hiring people to do stuff is typically the labor. So, if you can do it yourself then you should be able to save a lot of money. Whether it’s small fixes around the house or simply mowing your lawn, there is a lot of money to be saved. When it comes to bigger projects, remember that you can always rent the tools you need for much cheaper then buying them. And if you do hire a contractor or other professional, remember that you can often do the demolition for them. Make sure you do your research so that you can save money on any remodeling project.
5. Work Toward Raising Your Income. In the short term, you probably can’t make any more money than you are now. However, over the long term, your options are completely open. You can find many different ways to make more money. For starters, you may be able to negotiate a raise at your current company. If that isn’t an option, you could consider changing jobs. Better yet, start working toward a certification or a degree that will increase your potential wages. And if none of those work, you can always moonlight or find a second job. With the age of the Internet there are lots of jobs, albeit low paying, that you can do from home. Always be thinking about how to get more money flowing in.
6. Be Healthy And Save Money. There are lots of ways that being healthy can save you money. For example, healthier foods are typically less expensive. Also, riding your bike or walking instead of driving is healthy. Converting to a healthy lifestyle can also save you money over the long term, in the form of lower health care costs. In addition, being healthy and excersing can lead to big gains in your productivity. This can lead to increases in your income if applied to your job, and to savings at home, if you can get more done yourself.
These are six the six lifestyle changes that we thought of. What would you add to the list?
