spending less

7 Ways Being Single is Better for Your Bank Account

Paul Michael — Tue, 06 Feb 2018 09:30:08 +0000

Valentine's Day is once again fast approaching. People in relationships are saving up to treat their partner to something special. And for those seeking romance, it's a great opportunity to drop a few hints with a card and candy. But for the millions of people who are single, this time of year can really suck.

If you fall into the latter category, take heart. You may not be part of a couple, but your bank account will adore you. Here's why.

1. Valentine's Day is a money suck

Romance is big business in America, and retailers will do everything they can to get you opening your wallet. In 2017, USA Today found that Americans spent over $18 billion on the day for lovers.

Think about all the good that money could have done; schools, hospitals, care for sick people. Instead, it was spent on overpriced roses, chocolates, teddy bears, jewelry, fancy meals, and lingerie. This equates to the average consumer spending around $137 on February 14, although clearly some people are spending way more.

If you're single and like the idea of chocolates and flowers, wait until the day after. They'll be reduced by 50 to 75 percent (or more in some cases) for the exact same products. (See also: 14 Ways to Spend Less Money on Valentine's Day)

2. Your food budget goes a lot further

When you're shopping for two, you spend a lot more than when you're on your own. For a start, the chances of you both loving all the same foods is slim. Speaking from personal experience, I can meal prep the same food that I love for the whole week and eat it every night. It's cheap, it's balanced, and it suits me just fine. In a couple, that was a complete no-go. The same meal every night? No way. That means more ingredients, more recipes, and more money.

What's more, dining out as a single person is not as attractive a proposition as dining with a partner, so less is spent on restaurants and other eateries. And when you do eat out alone, you're spending at least half as much. Couples have a tendency to splurge on wine, desserts, and so on. When you're eating alone, you don't want to linger for as long, and that means less time to eat, drink, and spend. Those savings are delicious.

3. Weddings aren't cheap

If you're fretting about the couples around you that are planning to get married, this little statistic should ease the pain considerably: According to The Knot, the average cost of a wedding in the USA in 2016 was a staggering $35,329.

That is up $2,688 from 2015, which means you can expect that average to be even higher this year. After the cost of food and wine, renting a venue, a DJ or band, flowers, cake, invitations, photographs, and favors, the average price per guest rose to $245.

That's right, you're spending that much for each and every guest you invite. And let's not forget the cost of the wedding dress, the ring, and the expensive honeymoon after the big day. You can easily kick-start married life with over $40,000 in debt. Consider that next time you see a couple walk down the aisle.

4. You have time to focus on your career and your finances

Relationships eat up time. There's just no getting around that fact. Of course, people in happy relationships will point out that it's exactly the reason they're seeing someone; they want to spend time in the company of someone they love, and why wouldn't they? But this has to come with a sacrifice, and usually it's the career and the ability to make money that suffers.

The relationship will take a hit if one of you is working late night after night, or canceling plans at the weekend to pitch on new business. Guilt sets in, and instead of devoting time to a higher salary and new opportunities, it becomes the norm to spend free time eating out, going to movies, and taking weekend trips to the mountains or the beach. That means instead of using your free time to earn money, you're using it to spend money. (See also: 13 Ways to Make Money From Valentine's Day)

5. No more spending money on gifts

Aside from Valentine's Day, there are plenty of other dates on the calendar that make you spend money. Birthdays, anniversaries, and major holidays will hit you in the bank account throughout the year. Depending on what your partner is into, these gifts can set you back hundreds (or even thousands) of dollars. Forget the watches, clothes, gadgets, and gift cards, and instead save the money. Or, buy yourself something you've always wanted. (See also: 12 Fun Facts About Valentine's Day Spending)

6. Vacations are cheaper alone

Most couples like to do things the traditional (and expensive) way when they go on vacation. A hotel room, rental car, taxis, shows, restaurants, and bars are usually part of the mix. But when you're single, your options open up considerably, and the cost of your vacation can drop dramatically.

For a start, as a single traveler, a site like Couchsurfing can be a huge money-saver, and it's also a great way to meet other people and make new friends. You could also use Airbnb to find a bedroom in a local house that is way cheaper than a hotel room. You don't have to compromise on anything. Eat the food you want. Go where you want. Spend as little as you want. Single travelers have much more freedom, and way more options available. When you have more options, you have more opportunities to save money.

7. Two people means double the debt

The average person with credit card debt owes $5,331 on their cards, according to CreditDonkey. When you become part of a serious relationship, and get married, you combine the debts you owe. That means you are now responsible for twice what you were before.

Admittedly, you probably have two salaries (although not every couple has two incomes), but it can become daunting to look at the combined debts you have to pay off. As a single person, your debts are your own. And you can choose to live very frugally to pay off your debts, which can be a lot more difficult to do when your partner doesn't want to eat ramen and eggs four times a week.

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This article is from Paul Michael of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Should You Budget Like You Diet?

Sarah Winfrey — Tue, 17 May 2016 09:30:26 +0000

"Spend less" is right up there with "lose weight" and "eat better" as one of the more popular New Year's resolutions of all time. We are almost halfway through 2016 and, whether your resolutions are going well or poorly, there's probably room for improvement.

It's a great time to sit back and evaluate your resolutions. Are you achieving your goals? Do you feel half-hearted, at best, about the things you're pursuing? What can you do to improve over the rest of the year?

If you wanted to budget better and spend less, you can take some hints from the people trying to lose weight. In some ways, these are very similar endeavors, and you can learn from the things we know about losing weight to gain some financial heft.

Think Simple

Michael Pollan is famous for saying that we should only eat food with five or fewer ingredients, all of which we recognize and can pronounce. This helps dieters to eliminate junk from their diets, and a similar simplicity can help you spend less.

Think about paring down your life so that you only buy things you need, or taking certain extravagant categories out of your budget entirely. You might consider selling the five pairs of shoes that you never wear and replacing them with one that actually meets your needs. Or maybe you don't really need to go to happy hour every evening, after all. When you eliminate these things from your financial diet, you will spend less.

Prepare Yourself Ahead of Time

Some people gain weight simply because they never have healthy food around. They can combat this by meal planning and prepping — spending some time, once or twice a week, getting food ready for the next few days. This can include meals, snacks, even desserts. Similarly, if you sit down once a week to plan your spending, you can save money.

Take 30 minutes every week to look ahead at what you'll need to spend money on. Maybe you need to buy lunch for your team at work this week, or you've got to have a new clothes dryer. Work out how you're going to find the money for those things. You can even do some research online, so you know about how much you'll spend. Even just having a ballpark figure in your mind can help you refrain from overspending when making the actual purchase.

For larger items, take the time to research different options, etc. Decide what features you really need, want, and can afford, so you don't end up splurging last minute.

Consistency Is Key

One of the major principles of modern weight loss is consistency. You can't just eat well one or two days a week, but you need to make good food choices every day. Similarly, if you want to spend less money, you need to figure out how to consistently make good financial choices, too.

Figure out what motivates you financially. Are you saving for a trip to the Caribbean? Do you want to buy a new car or a house or know that you can retire at 60? Keeping your goals in the forefront of your mind (and even writing them down where you can see them) will help you remember, every day, that every choice matters.

There Are No Villains Here

Dieters are learning that there's no such thing as a bad food. Sure, some foods have less nutritional value, but when you're craving something, it's better to have a little than to deprive yourself now and binge later. A similar principle can apply financially.

If there's something you really want to buy, and you say no and think about it for a week or a month and you still want it, it's worth looking into ways to get it. If you need to save, start a special savings account. If you can fit it in your budget by taking other, non-essential things out, then make it work. Otherwise, wanting that thing can make you miserable.

Along the same lines, there are no absolute rules for saving. There's nothing that says it's always wrong to spend money, and no saving formula that works for everyone. Instead of villainizing certain items and methods, realize that there is a time and place for everything, even in your budget.

Take Baby Steps

Dieters often find that taking baby steps — making small changes one at a time — is more effective for achieving their goals than overhauling their lives entirely. Budgeting and saving money can be like that, too.

Instead of eliminating whole categories from your budget ("I'm not going to eat out at all this month!"), try making incremental changes ("I'm only going to eat out twice, instead of four times, this week."). These kinds of changes will make you feel less like you are missing out, and you will still end up with more money in the bank than you would have otherwise.

Do It Yourself

People who cook their own food often end up weighing less than those who don't. In a similar vein, people who DIY it as much as possible often save money.

Last week, my washing machine stopped working. I had several people send me names and numbers of repair folks. I'm sure they were well-intentioned, but I decided to try it myself, first. Sure, it took a couple of hours and some YouTube-ing, but I was able to do the necessary repairs on my own. I saved myself at least a couple hundred dollars because I didn't call the repair guy.

There are a lot of things you can learn to do online in order to save yourself some cash. Sure, you have to balance the cost of your time and energy with what you'd spend, but it's often fiscally worthwhile, not to mention satisfying, to do simple repairs and food prep yourself.

Take a Financial Cheat Day Now and Then

Some weight loss experts consider it wise to plan a cheat day (or a cheat meal) into your diet so you don't feel so deprived and end up binging. Planning a financial cheat day can function very much the same way.

Note that a cheat doesn't have to be huge. Buy your coffee instead of making it one day a week, or take your family for authentic Mexican instead of Taco Bell. Plan your cheats around things you really want, things that are satisfying to you, and you'll be able to stick to a stricter budget the rest of the time and, ultimately, you'll spend less than if you tried to restrain yourself all the time.

Do you budget like you eat? What does that look like for you?

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This article is from Sarah Winfrey of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

The Limits of Small Economies

Philip Brewer — Wed, 23 Jan 2013 10:48:37 +0000

The first step always recommended to people whose finances are out of control is that they institute some small economies. Quit with the fancy coffee drinks. Brown bag it for lunch. Switch to generic brands at the grocery store.

These steps are mentioned first not because they're the most important, but because they're quick, easy, and (almost) universally appropriate. But the hard truth is that small indulgences are not what ruin people's finances. (See also: Simple Living Through Capital)

Financial Ruination

People's finances are ruined two ways:

A sudden drop in income.
A large uninsured expense.

I started to make separate lists of the sort of things that lead to these problems, but it turns out there's so much overlap that one list pretty much covers it: Unemployment, illness, accident, divorce, lawsuit, natural disaster, business failure, disability, etc.

Those are the things that cause individual financial collapse, not being unable to resist the latest shiny high-tech gadget.

Failure to Thrive

Which is not to say that people shouldn't attack the small indulgences. That's still worthwhile, for two reasons.

First, they're something that you can take action on right now.

Attacking the big things often takes months or years of effort before there's any payoff — moving to a cheaper house, getting a better job, changing careers, settling a lawsuit. (And that's putting aside the really terrible situations like a terminal illness where there's literally nothing you can do to fix things.)

Saving a few bucks every week won't fill the hole blown into your finances by a major disaster, but it does give you something positive to do.

Second, although small indulgences are rarely if ever the reason for ruination, they do make it hard to get ahead.

Back before interest rates were so low, it would have been possible to write a little parable here about how much money you could save over 10 years if you cut your expenses by $20 or $50 a week.

At current rates, that story isn't so compelling now. But however little money small sums invested at low rates for a few years adds up to, it still leaves you way ahead of the alternative — small sums borrowed at high rates for a few years. (Go ahead and crank the numbers on that if you don't believe me.)

However you figure it, small economies do give you the chance to accumulate a little capital, and a little capital improves your life in many ways.

This article is from Philip Brewer of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

How to Spend Less Without Starting a Budget

David Ning — Tue, 15 Nov 2011 11:24:48 +0000

Some of the most common advice for helping someone spend less is to start a budget, but this approach doesn't always work. (See also: The First Step to Budgeting)

With a budget, it's easy to get used to how much money you spend because you are so accustomed to seeing the total on a monthly basis. Instead of helping you spend less, you are actually training yourself that your current level of spending is necessary. Then there's the problem of actually doing the work. Many people who have budgets often forget to add up a receipt here and a receipt there, which makes the whole budget unreliable.

And in reality, having a budget doesn't automatically help you spend less anyway. Some people feel that as long as they see what they are spending money on, they will stop. This is just a pipe dream. It sounds obvious, but unless you take the effort to spend less on a particular habit — something you can do without a budget — your spending won't go down.

Try these tips to lower your spending without starting a budget.

Start From Scratch

This isn't easy for some people, as you can imagine, but eliminating almost all of your expenses and starting from scratch will help. What I mean is to treat every bill, every meal out, and all your automatic payments as expenses that you truly cannot afford. Once you scrutinize every detail of what you pay, you will find that part of your spending is on things you don't really care about, and you can start reducing.

Pay Yourself First, and Pretend You Have Less

The fastest way to spend less is to have less. When you have less to spend money with, you will find a way to survive. We obviously don't want to voluntarily decrease our income, so the closest thing we can do is pay ourselves first and then pretend we have less. That's why we should schedule our deposits to our retirement accounts the day we get our paychecks and to increase our savings amount every time we get a raise. If we don't get a chance to use it, we probably won't.

Pay Off Debt

Another way to lower your spending is to think of ways to work on your debt payments. From refinancing to moving debt around to lower your interest rate, there are many ways to reduce your debt in order to lower your monthly obligations. Don't forget about this side of the equation, because spending some time here can reap huge rewards.

Having a budget is good only if you have the discipline to keep up. As with everything else in life, there are more than one way to skin a cat.

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This article is from David Ning of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

5 Dreams You Won't Achieve Unless You Live Below Your Means

David Ning — Wed, 20 Jul 2011 10:36:09 +0000

Living below your means is probably a personal finance tip that you already know about. In fact, spending less than you earn has been talked about so often that it doesn't even feel like advice anymore — many people's reaction is, "Isn't this obvious?"

However, not everyone who knows what to do actually practices what they know. If you are one of those people, you probably won't be able to achieve the following dreams unless you start living within your means. (See also: Living Within Your Means Isn't Nasty)

Having More Time (and Working Less)

Spending less than you earn gives you the option to have more time to do things you actually want to do. You don't have to take a job with tons of overtime just because you need the money or a far away job that sucks out all your time because the daily commute is extremely long.

Retiring Early

If you still choose to work like everybody else who absolutely needs every penny of their paychecks, you can actually retire much earlier than conventional wisdom dictates. I know plenty of frugal people who retired in their 50s even though they never earned a high income. When you spend less, your need to accumulate a really high nest egg reduces too.

Finding a Job You Love

If you love what you do, you won't feel like you are working a day of your life. Yet, too many people work at jobs they hate because they need the income to keep coming in. Funny how most people actually can't stop themselves from buying even though the mortgages, car loans, and credit card bills are like chains that link their lives to everything they find miserable.

Getting Better Raises

Unless you've been living in a cave (or have so much money that you have your assistant carry your wallet and pay for everything), you know that prices of just about everything have gone up. Fortunately, not all is bad in regards to inflation. People who spend less than they earn are have an easier time adjusting to the new prices because even though their companies' raises might be smaller than the inflation rate of goods, these people are more likely to have the increases to their cost of living fully covered by their raises.

Here's an example. Let say you make $50,000 dollars and get a 2% inflation adjustment this year, giving you a $1,000 raise. If you only spend $20,000 a year, and a 2% increase on $50,000 is $1,000, it's like you have a 5% increase on what you can spend.

Buying When You Want To

Before you know it, living below your means will equate to having a small cash reserve of your own built up, giving you the power to buy the items that you want, when you want. And if you are like many people out there, the urge to buy immediately might actually dissipate because you know that you can make these purchases at anytime, even if there is a coupon that urges you to buy now. Furthermore, once you skip a few purchases, you will probably find that most of all those impulse buys are really just unnecessary to begin with, saving you even more money.

This article is from David Ning of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

The Buy-Nothing Lifestyle: Lessons from a Frugal Experiment

Silicon Valley Blogger — Thu, 27 Jan 2011 13:00:11 +0000

Could you be ready for a lower-cost lifestyle? During the start of the year, many people resolve to make positive changes in their lives. They usually take on the goal to lose weight or to reduce their debt. But what about the "no buy" lifestyle? This sounds pretty extreme or somewhat absurd, but there are people who seem up to the challenge.

For instance, there's David Hochman, who was able to get through a whole month without spending beyond $100. In fact, his entire family was part of this frugal experiment. Their rules were simple: Other than the bare essentials, like fresh milk and fruit, the Hochman family would do its best not to buy anything.

While this sounds like a pretty extreme way of cutting costs, realize that this was just an experiment to determine how feasible it was to live on very little. (Although extreme saving is somewhat of a sport for some people.) David Hochman's Reader's Digest narration of his family's adventures reveals he learned quite a few things, among them:

Their cupboards had a LOT of food that got them through the month. David's most priceless find: a can of black beans.
The free food samples at Costco helped them get by with less.
They could score some free stuff by answering surveys from sites like MySurvey.com.
A plumbing emergency could actually be solved by a shot of dishwashing liquid poured into boiling water and poured down a drain that was threatening to regurgitate sewage.
There are generous people out there who are willing to give useful things away. For instance, someone offered a free 52-inch plasma TV on Craigslist. (Well, the benefactor just didn't want his ex-wife to get the TV during their divorce proceedings, but that's another story.)

Towards the end of their frugal-living adventure, David and his family found it more and more difficult to keep things together. The pressure of sticking to this financial challenge was starting to affect their relationships, leading to frayed nerves. By the end of the month, they were bickering, feeling irritable and stressed out. Clearly, there is a downside to radical savings methods and forcing ourselves to adapt to very stringent, limited budgets.

On the other hand, there were also a lot of valuable lessons learned from this experience. Things turned out differently for David once the experiment was over. He had expected his family to return to its previous spending habits, but they didn't. Instead, David's family members stayed close to home and learned how to keep their frugal habits in place. Their experience with extreme frugal living allowed David and his family to realize that they could live on much less and to appreciate the things that they already have. By these measures, this experiment was a success.

David recalled a rich person once telling him, "Money is important only if you don't have any." Indeed, that can be a bit of a paradox: Most of us actually have so much, but it's a pity that we don't always appreciate the things we already have.

For more examples of extreme savings challenges, check out this list of one-year challenges that other folks have embarked on. Here's a look at a few of them:

The Compact is a group of people from San Francisco who've made the commitment not to buy anything new for an entire year.
The Great American Apparel Diet is an ongoing pledge you can make that involves not buying any new clothes for a year.
What about promising to skip on dining out and entertainment for a year? Check out this blog called noteatingoutinny.com/.

So how about you? Could you possibly learn to live on much less?

This article is from Silicon Valley Blogger of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread: