Saving money and living below your means doesn't have to be painful. Sometimes it just takes incorporating a few "tricks" into your financial life. The other day, on our Living Below Your Means board, Fool Community member InTheWindow asked, "What's in your bag of tricks for keeping yourself on budget or LBYM [living below your means]?"
She then offered an example: "One way I keep myself in check is a daily drink count. I (usually) only usually 'allow' myself one drink a day -- if I buy a cup of coffee in the morning, I can't have Coke with lunch or Coke with dinner. It's good for my wallet, but more importantly my waistline. If I skip the morning coffee (or make it at home), I can have a Coke later in the day. I rarely drink beverages with my meals -- always a ton of water, though. It saves my wallet and keeps me skinny. These drinks are like my snacks."
Other Fools responded:
- NewImprovedDuck said: "I tell MrsDuck about any purchase I plan to make. That usually kills it right there."
- Angrypuppy offered: "I usually calculate the ramifications of buying something. For instance, let's say I spend $2 to buy a drink everyday during the week. So, 20 days times $2 comes to $40 a month. $40 a month comes to close to $500 a year or a new [Apple (NASDAQ:AAPL)] iPOD! That's my little trick." [Tips like these can also apply to your investing. If you aim to be a PepsiCo shareholder one day, because you have so much respect for its track record, growth potential, and diversification between beverages and snacks, you might remind yourself that that $500 could also be your initial investment in PepsiCo -- or whatever stock you have your eye on.]
- Reallyalldone added: "I compare the thing at hand to the larger goals I have -- do I want this more than I want [long term goal] ? Sometimes it also makes me take a good look at the longer term goals, as well."
- LilyLivered chimed in: "I've calculated how much each of my work hours is worth, net of taxes, etc. Then I determine the value of items purchased in terms of hours. So, if my net hourly rate is $20 and a sweater is $40, is it worth 2 hours of work?"
- IndecisiveFool quipped that his trick is: "Being born with a tightwad gene."
- cbrown24 reported: "I don't leave the house. I always seem to want to stop at Starbucks (NASDAQ:SBUX) or something if I am out and about. Luckily, I work at home. I also save my leftover coffee and reheat it in the microwave."
- Kuriooo added: "Since I have friends in a third-world country, I occasionally try to calculate the cost of a non-essential item I see here in the U.S. in their money. And then I think about what that amount would mean to them. It usually kills the purchase, especially if I don't see a good use for it." [This is a good time to mention that our annual Foolanthropy drive is under way -- please take a few minutes to learn about some terrific organizations and consider joining us in supporting them.]
There were lots of other excellent perspectives offered, such as turning your closet into an art museum, using wish lists, and paying bills electronically. Read them all in the whole discussion.
Employing a few tips like the ones above can help you rein in your spending and save effectively for retirement. Consider letting us help you out some more, too. You can get many helpful tips in our Rule Your Retirement newsletter, which is delivered monthly, full of inspiring stories and practical advice. Try it for free. And consider trying our TMF Money Advisor financial planning service, too. It's inexpensive, offers personal, professional advice via phone, and you can also try it for free.
Longtime Fool contributor Selena Maranjian owns shares of PepsiCo. The Motley Fool has an ironclad disclosure policy.
