Once upon a time, families were able to not only survive but thrive on a single income. But those days are far behind us. In fact, from 1960 to 2012, the number of dual-income families skyrocketed from 25 percent to 60 percent, a figure that remains on the rise. This is due to several factors, of course, but chief among them is the amount of debt most families have acquired over the years.
According to one report, the average household carries roughly $260,000 in debt across mortgage, student and auto loans and credit card bills. With such a burden, many households are in desperate need of guidance on how they can control costs without sacrificing quality of life.
Believe us, it’s not impossible if you approach your expenses with the right strategies in place. Case in point, here are a few easy ways to cut down on expenses and still have fun.
Make a budget, and stick to it.
The value of having a meticulous budget cannot be overstated. Crunching the numbers of your expenses against your income might be a somber task, but it is still the best way to uncover spending habits that might reveal opportunities for improvement in your household. Just be honest with yourself as you assess how much you’re currently spending. Once you take a closer look at your financial statements, you might be tempted to let your defensive bias adversely affect your estimates. Resist this urge, as you’ll only be undermining the entire objective.
Small changes make all the difference.
A grand, sweeping gesture—like trading in your car or moving to cheaper housing—might present a simple solution for trimming expenses, but you might not immediately be ready for such a drastic move. So start out by finding more modest ways to save money. Seemingly inconsequential tactics like cutting down on your home’s energy expenditure, exploring alternatives to cable television or joining a carpool can be significant approaches to eliminate unnecessary costs. You’d be surprised the difference these relatively painless methods can make on your bottom line.
Find free or cheap things to do.
These days, most cities are cognizant of the fact that budgets are tight for families and have risen to tap into their specific needs. If you do a bit of research, you will likely find a ton of free or cheap events in your community, including everything from museum exhibits to puppet shows. Local libraries and parks often host such family-friendly festivities. If you know where to look, discounts on fun things to do are also readily available. No matter what activities you and your family are interested in, you will surely discover something that suits you.
Cook at home instead of dining out.
For many American families, this one is bound to hurt. After all, according to a report by the Bureau of Labor Statistics, the average household spends just over $3,000 each year on dining out. By cooking at home more often than not, you’ll be able to feed your entire family for a much lower price and have the opportunity to create healthier meals in the process. Just be careful to plan your week’s menu ahead of time to prevent buying more groceries than you need (especially perishables). Prepare several meals at once, and you can consolidate cooking time. Even better, try involving the kids and make meal prepping a family affair!
Shop the sales or go outlet hunting.
Cooking more might be a practical solution to saving money, but groceries are only a fraction of your household expenses. For some items, you might be able to trim costs by simply keeping a close eye on sales. Many stores have regular discounts on a wide variety of products to incentivize shopper loyalty, while others offer coupons or even loyalty programs. For quality items at a greatly reduced price, look into any outlet malls or consignment shops in your city. Although you’re cutting back on luxury items, you don’t need to completely do without.
Moderate your holidays and other celebrations.
In the quest for creating unforgettable memories, many families fall into the trap of emptying their bank accounts to celebrate birthdays, Christmases and other holidays. Remember though that it is the time you spend with your children, not the amount you spend, that will ultimately make a lasting impact. Reorient your focus away from the expense of it all, and set a budget specific to the occasion or event you’re planning. Moreover, you can find plenty of cheaper, more homemade ways to make holidays special and foster those familial bonds. You just might have a richer experience by the time all is said and done.
Don’t be afraid to treat yourself.
Although we’ve highlighted various ways to cut expenses and control costs, don’t neglect the importance of giving yourself a bit of leeway with how you spend your money. Over time, your family may manage to save using the strategies above, and you should—on occasion—feel comfortable to splurge on something of particular interest. Maybe that’s an overnight trip, concert tickets or a fun night out at your family’s favorite restaurant. Whatever it is, be sure to build the occasional treat or extra purchase into your budget to prevent the frustration and fatigue that might accompany your newfound financial control.
With some practical steps to apply to your household, it’s very possible that you might be able to even begin building a savings. One tool you might use to maximize your account is the AAA and Discover deposit program. With four quality, high-yield savings products, you’ll be able to accelerate the growth of your savings in no time.