Save Money: How to Live Below Your Means

You hear it all the time. People are living beyond their means and then they find themselves in all kinds of financial ruin. That’s not where you want to be. You also don’t want to simply live within your means; it is much better if you can learn to live below your means. This is just one part of how to succeed in life.

Today’s blog post is partly inspired by a friend of mine (you know who you are), but it is easily applicable to just about anyone. If you’re having some trouble figuring out how to save your money, these ten tips are likely a good place to start. So, in no particular order…

1. Track All Your Expenses, Every Penny

One of the first steps toward better money management is to track your money. That makes sense, right? For some people, this means taking a look at all the bigger expenses, like paying the mortgage or buying a new television, but the only way that this is going to work is if you track every last penny. Went to the corner store to buy a chocolate bar? That counts. Write it down in the appropriate category.

It’s up to you what kind of categories you use: food, entertainment, utilities, car, etc. At the end of the month, you can tally up all of these amounts and see where your money is going. The key, which many people miss, is to do something with this information. Where can you cut back? The $5-a-day latte habit might be a good place to start. It can be enlightening to see all of tis data in front you, in black and white, plain as day.

I recommend trying this exercise for at least a few months at a time, not only so you can get a more representative sample, but also so that you can see if you’ve made any progress.

2. Look for Used and Refurbished

Do you need something? Don’t automatically go to the store and buy a new one. There are so many possibilities out there in the used and refurbished market. Let’s say that you need a new computer monitor. Ask your friends and family if they have a spare kicking around that they don’t want. Try looking around on Craigslist and eBay for deal. Consider buying a refurb unit from a place like You’d be amazed how much you can save and, if you try hard enough, you can oftentimes find a used version with “like new” condition. This can be huge with furniture too.

3. Don’t Buy Just Because It’s Cheap

Shopping “for fun” will inevitably lead to temptation and this can easily lend itself to all kinds of impulse purchases. You may stumble across what you may feel is an unbelievable deal and you may think yourself the fool if you pass it up. However, you have to ask yourself whether you really need this item or whether it is really just another waste of money. Remember that 25% off means you’re still on the hook for 75%. Paying 0% instead can save you a lot of cash.

4. Seek the More Frugal Alternative

There is always a cheaper alternative. You probably don’t need the highest model of your desired product. You probably don’t need the newest version. Step it down a notch and you can save tons. Similarly, consider using the library to borrow DVDs rather than renting (or buying) them at the store (or Netflix). Did you know that Vancouver Public Library even rents video games?

5. Eat Out Less Often (and Be Mindful of What You Order)

I will admit that I love eating out and I maintain that it is one of the best ways to spend your money. It is also one of the worst ways to spend your money and that is why I do it in moderation. If you choose to cook your own meals at home, you can save a lot of money compared to eating out and this includes fast-food joints. This is especially true for drinks, so keep the bevvy orders to a minimum (or, better yet, stick with water alone).

6. Breathe New Life into Your Older Junk

Reusing is so much better than reducing and recycling. Before you throw something out, consider if it can be reused in some useful fashion. An old t-shirt, for instance, can be great as a rag for washing the car. Also, take good care of your belongings, maintaining them properly, and they will last longer. This means they won’t need to be replaced as often and, thus, you can minimize those expenses.

7. Increase Your Means

Easier said than done, I know, but one of the best ways to live below your means is to improve what “your means” really means. By giving your income level a nice little boost, you can enjoy a bigger cushion when it comes to expenses. Take on some side projects or consider making money online. An extra part-time job, even in the short term, might be worthwhile and you can get some extra cash by selling your unused junk through yard sales, Craigslist, eBay, and so forth.

8. Simplify, Combine, and Negotiate

The simpler you keep your life, the cheaper it can be. This is especially true when it comes to many of the services you may use. With television, for example, you can probably make do with a smaller bundle rather than opting for every premium channel on the menu. Get rid of the landline telephone and opt to use your cell phone alone (and use that less too). Similarly, combine your services to get “bundle” discounts from these providers, negotiating for good retention plans (or similar offers) whenever possible.

9. Remember to Pay Yourself First

Whenever payday rolls around, it’s easy to think that your coffers have just been reloaded with more expendable income. It might be a good idea to set up an automatic savings program that funnels away a percentage of your paycheque into a savings account. Also remember to work toward reducing your debt and contributing to your retirement fund. These venues for your cash are more worthwhile than buying yet another new toy or going out for another fancy meal.

10. Resist Temptation and Stay Disciplined

Ultimately, the single greatest tip for someone trying to save money and live below his or her means is to stay disciplined. They say that winning the lottery only amplifies a person’s characteristics and habits. That’s why so many lottery winners are broke within the first couple of years. It is only when you change your habits and mindset that you will exact any real change on your financial situation.