When you’re just getting started in the working world, everything about personal finance — even saving money — can seem intimidating. It doesn’t seem possible to pay off your student loans or other debt, and still squirrel away money to invest in something like stocks or futures. Still, long-term investing is relatively easy to start once you understand the basics, but you need the capital to get involved.
Despite the intimidation factor, saving just $500 a month — which amounts to $6,000 a year — is enough to help you achieve a lot of financial goals, whether it’s saving up for a big vacation, or just making sure you have an adequate backstop for many of life’s sudden challenges.
If even getting to $500 a month seems like a stretch, don’t worry. There are many different ways to achieve this level of savings, no matter what your circumstances are, and there’s no single “right” way to do it.
Here are some ideas that will get you started saving money to the tune of $500 a month.
1. Get control of fees and micro-transactions.
How often do you visit the ATM? Twice a week? More often? Does it seem like ATM fees have been creeping up on you?
It’s not just your imagination.
Every transaction costs an average of $4.57. That means even if you only use the ATM once a month, you’re losing more than $50 a year in ATM fees. If you use it twice, that’s triple-digit losses to fees.
Other small fees — $2 there, $3 there — might not seem like much at a time, but saving money starts with realizing that whenever you’re faced with one, remember that they can add up over the long run. Pay attention to what you’re spending, even on a small level, and reduce fees wherever you can.
2. Learn to cook.
How often do you go out to eat? Once a week? Three times a week? Every day?
Obviously, you can’t just not eat — and whether you dine out or cook for yourself, you’re still going to spend money on food. But remember that every time you go out and spend $15 on lunch or $50 on a nice meal and drink for yourself, you can typically make something similar for yourself for roughly a quarter of the price.
The internet is filled with great cooking tutorial videos and recipes. Pile on the savings by learning to cook with whatever ingredients your store has on sale at any particular time.
You can save literally hundreds of dollars every month on just this advice alone.
3. Eliminate cable and media subscriptions.
Are you currently paying for cable? Stop.
Media subscription services such as Netflix and Hulu offer much cheaper ways of watching TV shows and movies than typical cable subscriptions. Granted, you may not have nearly the same menu of content as you had before, but think about what your current cable package offers, then think about how much of it you actually use.
Research the various streaming services out there, then select the one that has the most of what you want. You’ll typically save anywhere between $30-$80 a month by going this route, which adds up to hundreds over the course of the year.
And for a few more cheap options, remember that you still can get a few channels via an inexpensive digital antenna, and there are thousands of libraries where you can borrow movies and music for free.
4. Take public transportation.
If you live out in a rural area, this particular tip might not apply. However, all big cities and even many smaller cities have reliable and inexpensive bus and other public transportation systems.
Start using them, even if it’s just for a couple days a week.
By some estimates, switching from a personal vehicle to public transport can save you more than $700 a month, thanks to savings from parking, gas, maintenance and other costs.
5. Bike, walk and run.
Consider this an “expert level” way of saving money on your daily commute.
This can be difficult or downright impossible for many people, but if you live close enough to work, you can bike, walk or even run to your job and some smaller errands to tamp down on the daily costs of operating a vehicle.
Not to mention, this will help you lead a healthier life — something that can also help you save in various healthcare costs down the road.
6. Examine your vices.
There’s nothing wrong with having fun, but your vices can cost you hundreds of dollars a month if you aren’t careful.
How often do you drink alcohol? How many cigarettes do you smoke every day? You don’t even have to use the “Q” word to save money in this area. Examine your vices, and if you think you could reduce your alcohol or tobacco consumption by, say, half, you could save hundreds of dollars a year.
Also, remember that the cost of alcohol at the bar is far higher than it is to just buy beer, wine or spirits at the store and drink at home. Not only can you save money on the simple costs of alcohol by drinking a bit more at home, but you can save on taxi or Uber fares.
7. Buy used and refurbished.
There are only a few consumer products that are always worth buying new — think shoes and mattresses, which you absolutely wouldn’t want used.
However, you can find used and refurbished options for many things — from cars to appliances to electronics — that are much less expensive and still provide years of quality use.
Just remember that while cheap is good, and you’re saving money, you’re not necessarily getting a deal. So you need to do your research on the durability of various used goods. For instance, Consumer Reports, U.S. News & World Report and other rankings agencies provide numerous studies on which used cars are more reliable than others.
8. Reduce your utility consumption.
Utilities are one of your biggest necessary expenses, but you can control how much you consume to reduce your total costs.
For example, installing LED bulbs in your house can dramatically decrease how much you pay for electricity — and you’ll even make money back with an Energy Star rebate.
Turn off lights and appliances when you aren’t using them (for instance, while you’re away at work or at least during vacations). And set your house to slightly warmer temperatures in summer and slightly colder temperatures in winter, even if only when the house is left unattended.
9. Cut back on waste.
When you buy a gallon of milk, do you end up drinking the whole gallon or throwing half of it away? When you buy a roast beef, how much of it do you end up eating? How much is thrown away as scraps?
Maximizing your investments by only buying what you need can be a significant step toward saving money. Similarly, eating/drinking everything you buy, and utilizing leftovers — whether it’s on their own, or using them to make other meals — will help you reduce costs.
The EPA has a few thoughts on reducing food waste, if you need some tips.
10. Shop smarter = saving money.
You can always save money on groceries by comparing prices of different chains. Typically, if one supermarket chain isn’t providing deals on certain goods, it’s a good chance that another chain is. And when it comes to things like certain cuts of meats or types of seafood, deals tend to cycle, so if what you want isn’t cheap right now, it’ll typically go on sale within the next couple weeks.
You can also save by planning a more efficient grocery list, and of course, relying on coupons — via providers like Coupons.com — and specials to get more bang for your buck.