When I started interviewing people for my book Generation Earn, I was shocked by some of the creative techniques people came up with to save money. The unifying theme was that people cut costs in ways that made their lives better, not worse. Instead of denying themselves splurges like new jeans or a new car, they learned how to cook their own food that tasted much better than anything served at a restaurant, or perfected their at-home tea and coffee brewing techniques.
[In Pictures: 12 Money Mistakes Almost Everyone Makes]
Here are six ways you can start saving hundreds of dollars a month, while also improving your quality of life.
Don’t spend more than $30 on any item of clothing. Stores such as H&M, Forever 21, and Old Navy make it easy to buy cheap, stylish clothing. While you’ll probably need to make some exceptions, such as for a winter jacket, the vast majority of your wardrobe can be purchased on the cheap. Yoga studio owner Kimberly Wilson, who dresses in a way that would impress even Rachel Zoe, applies this technique so she can focus her money on growing her business instead. Wilson, who’s in her mid-30s and lives in Washington, DC, says she’d rather indulge in simple, daily pleasures than expensive shoes or jewelry. Estimated savings: $200 a month or more.
Party at home. Game nights and girls’ nights in have soared in popularity recently, which is no surprise given that a night out on the town means paying $8 or more for drinks and $50 or more when you include cab rides, cover charges, and meals. Gregory Go, 33, co-founder of Wisebread.com, invites people over for potlucks and game nights, which means he gets to spend time with friends for a fraction of the cost of a night out. As an added bonus, he tends to clean out his friends’ wallets in poker games. Estimated savings: $100 a month and up.
Give love coupons instead of gifts. As you plan your holiday shopping, consider this: Giving the gift of your time in the form of a coupon to take your mom to a museum, or out for tea, can be far more meaningful than buying her a cashmere sweater. Tim Kasser, professor of psychology at Knox College in western Illinois and father of two young children, encourages his family to give each other coupons for experiences, such as favorite meals or back rubs, rather than purchased gifts. For his sons’ birthdays, Tim typically gives them a special day with him, such as a trip to the local water park. Estimated savings: $25 a month or more.
[For more money-saving tips, visit the U.S. News Alpha Consumer blog.]
Substitute fancy dinners with cheap date nights. Dining by candlelight at the most exclusive restaurant in town might seem romantic, but the bill can put a damper on those loving feelings. Instead, try these ideas, suggested by Alpha Consumer readers: Browse a bookstore. Sketch portraits of each other. Take dance lessons. Have a picnic. Go to a lecture or performance at your local college. Watch a model rocket launch. Estimated savings: $200 a month and up.
Turn your freezer into your very own “fast-food restaurant.” Kate Deriso, 39, a holistic health counselor in Sterling, Virginia, spends no more than $150 a week on her entire food budget for her husband and herself. They make their own breakfasts, lunches, and dinners and rarely eat out, because they’ve discovered they can make better meals themselves. She grows her own alfalfa sprouts to spruce up sandwiches and cooks one-pot dishes such as her favorite chicken and olive dish. She calls her freezer, which is stacked full of ready-to-eat leftovers, her “fast-food restaurant.” Estimated savings: $400 a month and up.
Eat before you go to restaurants. Ben, a thirty-something lawyer in Washington, DC, who works for a nonprofit and earns around $52,000 a year, buys a six-pack of bagels and a box of tea each week and skips the coffee shop. He also snacks on peanut butter and banana sandwiches before meeting up with friends at night so he can bypass the pricey entrees at restaurants, opting for cheaper appetizers instead. Estimated savings: $100 a month or more.
With these techniques, you’ll have fun hosting parties, holding cheap date nights, and inventing new meals and gift coupons, while putting a lot more money in the bank. Total Savings: At least $1,000 a month.
Kimberly Palmer is the author of the new book Generation Earn: The Young Professional’s Guide to Spending, Investing, and Giving Back.