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Have you ever looked at your budget and concluded that there was NO way to squeeze out any extra money without a side hustle? *Raises hand*
Side hustles are a great way to earn an extra income, but not everyone has one, wants one, or has the time to do it consistently. I once sold items on eBay and worked as an academic freelance writer, which made me up to $400 each month, but I got burnt out and took a break.
Without the extra money, I knew I needed to find other ways to reduce monthly expenses. After carefully combing through each budget category, I was able to free up $350 by doing these 4 things:
Negotiate a lower payment
It wasn’t until I began researching ways to reduce my monthly expenses that I discovered ‘negotiating’ was an actual thing! I thought that my payment was my payment and there was no getting around it.
If you are a loyal customer that keeps your accounts in good standing then you are a company’s prized possession. Don’t be afraid to negotiate a lower payment as there’s a good chance they will accommodate you to keep your business.
OK, but how?
Be kind, but firm. Advise them that you are looking to decrease the amount of your payment, and see what options they have available. Gently remind them that you are a good customer, and make it clear you would like to keep your business with them. Also, be sure to inquire about any discounts or specials that you’re qualified for.
I used this tactic with my cable provider and was able to get a small discount by switching to a different plan. To do this, I simply picked up the phone and told them I needed a way to lower my monthly payment.
After a quick hold, the representative was able to find a cheaper plan with more channels for my daughter so it was a win-win. That simple phone call saved me around $10 a month. Of course, that doesn’t seem like a lot, but times that by 12 and that’s a $120 yearly savings!
Unfortunately, not every company is willing to budge so don’t be discouraged when you receive a rejection. I tried to negotiate a lower interest rate with my credit union when I had an auto loan, but they (very nicely) declined.
Total monthly savings from negotiating: $10
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Shop around for other plans
If negotiating a cheaper payment doesn’t work out, try shopping around for other plans.
My auto insurance continued to rise with every renewal, even with multiple discounts, so I began to look into policies with other companies. After doing a few online quotes, I was able to find one that was nearly identical to the policy I currently had, but for $35 less. Thank you, Geico!
It takes a little bit of time and research, but the outcome can be worth it if you’re willing to put in the work. Ask for recommendations from family and friends, and research popular providers in your area to find competitive plans.
When companies are on the verge of losing good customers, many will do whatever to keep you and remain competitive. My former insurance company tried to make a counteroffer, but it was still more than the new policy. With this in mind, be sure to weigh all of your options carefully before leaping to a new plan.
Total monthly savings from finding another plan: $35
Yes, the word that will make you cringe…downgrade!
When you’re looking to reduce monthly expenses this option is a valuable one, but you have to be willing to swallow your pride a little—or a lot. Give up that fancy new Lexus and trade it in for a cheaper car. Move to a cheaper place. Sell those household items that serve you no purpose.
When I knew I would be paying for daycare again (yay!), I decided to move into a cheaper apartment. I lost my own driveway, but I gained an extra $125 a month. A bonus was free water so in addition to cheaper rent I saved $55 for having no water bill! Longer showers, no worries.
Take a look at your monthly expenses and determine where you could downgrade. What do you have that’s excessive and could be replaced with something more moderate?
I was once spending $100 a month on my phone bill for unlimited data usage when I barely used the data at all (hello Wi-Fi). After switching to a pre-paid plan, my payment lowered to $55 a month. When I signed up for auto-pay, they knocked off $5 more making my total bill just $45.
Seriously, I can’t even tell the difference between the two plans and I wish I had switched earlier.
A downgrade may hurt your ego, but your account will benefit.
Total monthly savings from downgrading: $235
Make a lifestyle change
Last but not least, making changes to your lifestyle can lead to major savings.
When thinking about your routine ask yourself, What am I doing that I can change? Remember that this change doesn’t have to be a dramatic one. It could be something as simple as packing your lunch for work or carpooling a few days out of the week.
I typically work remote 2 days a week which saves me nearly $60 a month on gas. Since I don’t have to get out in traffic as much I’m also saving on car maintenance.
An oil change was needed every 3 months, but now I can stretch it to every 5. Synthetic oil changes cost me nearly $70 at the dealership, so I’m saving around $9 a month.
If you’re like me, it’s hard believing that a small change can make a big difference without doing the math. Calculate just how much something is costing you monthly, and determine if a slight tweak would be worth it.
Total monthly savings from a lifestyle change: $69
Altogether, I was able to reduce my monthly expenses by $350 ($349 to be exact but I’m going to round okay?), and I’m extremely impressed. Life gets busy, and I don’t always have time to put in extra work for more money. I’m proof that even if you feel as though your budget is as low as it can go, chances are there’s still some wiggle room.