9 Ways to Cut Your Monthly Expenses
In times of a global pandemic, natural disaster or even the loss of a job, it can be important to make sure that your finances are properly managed. One of the most difficult factors of personal financials is determining the best way to utilize your funds so you are taking care of your vital needs and expenses first. It can be difficult to save money during certain economic situations so the next best step is to cut any unnecessary expenses that you incur monthly.
Here are 9 simple but effective ways to reduce your monthly spending when you are trying to cut your expenses during a time of need.
1. Cut Cable Bill
Cable tv services seem to get increasingly more and more expensive. Some cable providers even require you to be locked into a contract in order to receive savings. If you’re looking for a way to cut down your monthly expenses, cutting your cable tv services could be the first step. Most households that cut their cable tv services reduced their monthly expenses by 20%. If you find that you’re not home often to use your cable services, you may want to consider cutting your cable. With all the online media resources, there are multiple options to watch tv shows and movies online without a cable tv subscription. Another option when it comes to reducing your cable tv expense is to look into non-contract cable tv services such as Sling Tv, Direct Tv on Demand, YouTube tv, Dish and more. The best part of these plans is that you are not locked down for a year, you may cancel your plan at any time. Learn more about ways to cut your cable tv monthly expenses.
2. Refinance Student Loans
Student loan payments can make up a huge part of your monthly payments with the high interest rates. One option to reduce your student loan monthly payments is by refinancing your student loans. This allows you to consolidate existing federal and private student loans you are currently paying off. The process of refinancing your student loans involves consolidating your student loans into one single student loan at a lower interest rate. This process results in a lower monthly payment and frees up extra money to take care of other monthly expenses. Unfortunately, you first have to be approved for this process. Learn more about your student loan refinancing options and if you qualify.
3. Lower your Cellphone Bill
Cell phones have become a necessary expense for all of us. With most homes cutting their landline services, your cell phone can be your number one form of communication during a crisis. While you would never want to cut your cell phone bill, there are many options you could look into when it comes to lowering your cell phone bill. One way to reduce your cell phone bill is to switch to automated payments or paperless billing. Most cell phone providers offer a discount if you switch to paperless or automatic bill pay. Other options for reducing your monthly cell phone bill include utilizing an employer discount, switching to a more basic plan, keep your existing phone (no unnecessary upgrades), or even switch to a new carrier.
4. Refinance Your Car Loan
Monthly car payments are a necessary expense so it is not something you can simply eliminate when trying to reduce your monthly payments. Fortunately, there is the option of reducing your car payment by seeing if you’re eligible to refinance your car loan. When you refinance your car loan, you could potentially reduce your monthly payment for the remainder of your loan term. The process of refinancing your car loan involves taking out a new loan to pay off the remaining balance of your current auto loan. When you take out the new loan, the hope is that you can get a better interest rate that saves you money on your monthly payment. If your financial situation has changed, you should see if you qualify for a better interest rate on your car loan.
5. Refinance your Mortgage
When you’re dealing with a financial hardship that makes it difficult to pay your monthly mortgage payment, you should consider refinancing your mortgage. This process works by allowing you to take advantage of a lower interest rate which will reduce your monthly mortgage payment. In order to consider this option, you will need to have adequate home equity to qualify for mortgage refinancing. Your home equity is the market value of your home subtracting what you currently owe on your mortgage. Financial experts recommend refinancing your mortgage if you’re able to lower your rate by 1% point.
6. Consolidate your Credit Card Debt
One way to reduce your monthly expenses is by consolidating credit card debt you may have. Credit card debt consolidation can reduce your monthly payments which in return can help you save money each month. There are multiple ways to consolidate your credit card debt which includes using a nonprofit credit counseling program, apply for a personal loan, utilize a balance transfer credit card, home equity loan or even using a retirement account loan. Consolidating your credit card debt can take time so make sure you consider all your solutions. Learn more about your credit card debt consolidation options.
7. Lower Bank Fees with New Checking Account
Do you currently find yourself paying monthly fees for your checking account? There is actually a huge selection of banks that offer no fee checking accounts. You can reduce the monthly fees you pay by opening a new checking account with a bank that does not charge a monthly fee. Some of the banks that currently offer no fee checking accounts that might be worth looking into are Ally Bank, Simple, Chase Bank Total Checking, Discover Bank Cashback Debit Account, and Schwab Bank High Yield Investor Checking Account. Learn more about your options to reduce your banking fees with a new checking account.
8. Cut Your Gym Membership & Work Out at Home
Gym memberships can be an expensive extra monthly cost depending on the terms of your gym membership and where you go to work out. During a financial crisis, one can simply cancel or freeze their gym membership to reduce monthly expenses. Many believe they cannot get a good workout at home, but they’re wrong. There is an abundance of online content that can give you step by step instructions on how to have an effective workout in the comfort of your home. By cutting your gym membership, you gain extra time at home, avoid large crowds, and most importantly, you save money! Check out at home workouts you could be doing instead of paying for a gym membership.
9. Reduce your Car Insurance
Car insurance is required to legally drive your car in the United States. While it is not an expense you can avoid, there are ways to reduce your monthly car insurance payment. One of the best ways to keep your car insurance costs down are to maintain a good driving record. Those with a good driving record can see significant discounts over time. Next, you can consider going for a higher deductible car insurance plan that reduces your monthly payment. However, if you find yourself in an accident, you will be required to pay that higher deductible. Another option for reducing your monthly car insurance payment is to bundle it with your home or even renter’s insurance. Most insurance companies offer a bundle discount if you bundle your auto and home insurance. Check out your other options for reducing your monthly car insurance payment.