This writer declares that anyone can add a little
discipline to their spending and invest the rewards.
Words by Rubina Ahmed-Haq
Being “frugal and fabulous” means taking control of your finances, saving more money and doing all this without sacrificing your lifestyle.
What if I told you that you could save more than $6,000 in one year by simply adjusting the way you spend and looking at your day-to-day costs differently? Would you try it?
Saving is a long process. Money grows when you leave it alone. For most of us though, saving is a temporary exercise and not a part of our way of life. For example, we stash money away for a luxury holiday, a new car or a bigger house. All admirable, but it won’t help to secure your future.
Nobody cares about your money more than you, and the journey to save more can start right now.
Change the Way You Commute
On average, 15 percent of our after-tax income goes to transportation. Canadians spend a lot of money getting from A to B. Drivers, on average, spend $2,250 per year on fuel alone. By being more fuel-efficient you can easily cut your fuel consumption by 10 percent, saving you $225 annually. How? Plan your route before you leave and don’t speed on the highway. According to Jim Davidson, the most fuel-efficient speed to travel at is 93 km/h; the U.S. Department of Energy states that most cars reach their optimal fuel-efficiency around 96.6 km/h. (Try searching the Internet for advice on your specific make and model.)
Go a step further and take public transit once a week. If you commute to work by car and pay for parking in downtown Toronto, then taking the GO train or the bus only once a week will translate to almost $500 in savings a year.
Adjust the Way You Shop for Groceries
Your kitchen is one of the easiest places to save money: try changing how and when you purchase your groceries. A recent Statistics Canada survey on spending patterns shows Canadian households spend $7,200 on groceries every year, but families also waste more than $1,464 in food because it goes bad or is thrown away. Buy only what you need and put that money into your savings.
Also, shopping with a grocery list saves 23 percent. Before you leave the house, jot down what you need and save $1,656 in 365 days.
Get Rid of Your Expensive Loans
Talk to your bank about consolidating all your credit card debts into one loan with a lower interest rate. This will free up extra money that was going to interest. Even an extra $50 a month will add up to $600 in 12 months.
Do You Need Your Landline?
Many of us are carry a cell phone all day and have a landline at home we hardly use. The average Canadian pays $31/month for the luxury. By cancelling your home phone, you can save more than $372 in one year.
Enjoy More Nights In
Eating out is expensive. Canadians typically lay down $150 a month at restaurants and on take out. Cut down your eatery visits by only 50 percent and you will save $900 a year. This doesn’t mean you can’t go out for dinner—just go out less.
Be More Energy Efficient
The average household spends $2,200 on water, fuel and electricity in one year. Look at ways of being more energy efficient in your home. In the summer, use a fan and don’t crank up your air conditioning. In the winter, keep your heating lower when away or asleep by using a programmable thermostat. When doing laundry, switch your washer to the cold wash; it’s 90 percent cheaper than using hot water. These easy steps can cut your bill by at least 20 percent and save you $440 a year.
Smoking and Drinking
Everyone knows tobacco and alcohol are bad for you, and yet Canadians spend thousands every year on these products. Curbing your habit by 20 percent will save you big money, almost $300 annually.
Savings After a Year
Follow these easy steps and you’re looking at potentially saving $6,457 in just one year.
The main point is that you need to stay committed to make saving a part of your life.
As you’re putting money away, make sure it’s in a high-interest savings account to see your money grow even more. At the end of the year you may want to consider investing your money in stocks or bonds. Consult a reputable financial advisor that will give you the best advice based on your financial situation. This is your money: protect it with the same effort it took to earn it and you will always be ahead.
Just remember that saving money doesn’t have to mean living like a monk—you can still have the vacation to Fiji and the new car. By making simple changes like those described above you can continue to live your fabulous lifestyle, the frugal way.
*Numbers based on a family of four with a total household expenditure of $71,117. Survey of Household Spending released by Statistics Canada in 2010.
Rubina Ahmed-Haq is a personal finance expert providing media commentary on money matters in Steven and Chris on CBC, as well as the Toronto Star, Moneyville.ca, RateSupermarket.ca and Condo Life Magazine. You can find her at www.AlwaysSaveMoney.ca.