8 Ways Americans Are Cutting Expenses (And How You Can, Too)
It’s fair to say that inflation has come for us all. The cost of living has gotten more expensive, and Americans are cutting back to make things work.
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“It is essential to cut costs in order to make more room in your income for saving,” said Mafe Aclado, a finance expert and the general manager of Coupon Snake. “But knowing you need to cut costs and being able to actually cut costs, are two separate things. Especially when it is difficult to identify the areas to trim from.”
Keep reading to find out the ways Americans are keeping more money in their pockets — and how you can, too.
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Cutting Back on Mortgage Costs
Say you bought a big house with enough rooms and facilities for your family to grow into. Aclado said, “Along with this bigger house also comes a bigger mortgage.”
And though you always keep up with your financial obligations — the zero wiggle room in your budget means you are barely getting by.
While this is the reality for a lot of people, Aclado noted that many Americans have cut their housing and living expenses by renting out spare areas to tenants and sharing some of the homeownership burdens.
“What makes this strategy quite effective, is the fact that it is sustainable and doesn’t require you sacrificing so much of the lifestyle you have already grown accustomed to,” explained Acaldo.
Buying a bigger house isn’t just an investment that pays off in the future, but one that Aclado said can also begin to pay off now.
Cutting Back on Entertainment
Americans are also cutting costs by considering less expensive entertainment options, and by being more creative when it comes to the leisure activities they participate in.
“For instance, they cancel subscriptions and instead of paying to visit movie theaters, they stream movies,” said Aclado. “They also consider less expensive hobbies that don’t require them to pay a monthly membership fee like playing board games with friends.”
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Using Budgeting Apps
According to Melanie Musson, a published insurance expert with Insurance Providers, Americans are using budgeting apps to help them spend less.
“An app is with you almost all the time, making it so much easier to follow than something on a piece of paper in your house,” said Musson.
Gardening
A recent trend Aclado noticed is that more Americans, especially those who enjoy fresh foods, have started gardening. And not just for the landscaping benefits.
“… instead of only growing flowers to adorn the exterior of their home, the plan is to grow some of the food they pay so much for in whole food stores,” Acaldo said.
Musson has observed the same, saying, “Americans are saving money by growing gardens.”
Gardening became popular back in 2020 during the height of the pandemic when many were staying in their homes.
Musson added, “… many people have stuck with the process and are producing plentiful harvests.”
DIY Solutions
Scott Waters, the payment expert and founder of Process Payments Now, offered another, significant approach — the emergence of the “do-it-yourself” culture.
“Many people look for ‘how-to’ videos on the internet rather than calling professionals when repairs or renovations are needed at home,” said Waters.
“Online services and websites like YouTube teach people how to do repairs such as carpentry, plumbing and even painting.
Not only does going the DIY route reduce your overall expenses, but Waters said it also “equips people with essential skills” at a low cost.
Subscription Sharing
Sharing subscriptions is another clever strategy Waters suggested.
“It is common for streaming and various software programs to create accounts for which multiple users can be included simultaneously,” said Waters. “It helps that most households share their subscriptions among family and friends to share the costs.”
This cooperative approach means that many people can benefit from streaming services while drastically reducing the monthly fee. For instance, the ad-free version of the streaming platform Max currently costs $16.99 per month. Splitting the subscription between two people drops the costs to $8.50, and splitting it between three drops it even more.
Automating Savings
Automation has become a reliable savings strategy that many money experts, including Waters, recommend. By creating an automated bi-weekly or monthly transfer from your bank account to your savings on payday, you eliminate unnecessary spending.
“Even where practical, it does not take an individual long to save for an emergency fund or targeted savings where even a tiny amount is added over time,” said Waters.
Cashback and Rewards Optimization
Intelligent consumers are also taking advantage of the cashback and rewards offered through their credit cards.
“Select credit card use that offers points or rebates on certain purchases such as groceries or gas helps to reduce total expenditures on fuel and groceries, ” Waters explained.
With just a little planning, you can maximize on the rewards you gain each time you swipe your card.
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This article originally appeared on GOBankingRates.com: 8 Ways Americans Are Cutting Expenses (And How You Can, Too)