Most of us would probably like to be saving more money, as most people have not saved very much for retirement. About half of people aged 35 to 44 have less than $25,000 saved for retirement, per the 2019 Retirement Confidence Survey -- and 23% of those aged 55 and older have saved less than $25,000, too.
Saving more is much easier said than done, though, which is why it can help to employ some tricks and strategies. Here's a look at seven tricks that can help you beef up your savings.
1. Embrace automation
You might embrace automation by building an army of robots to go out and get jobs and bring home earnings for you -- or, if you're less mechanically inclined, you might just automate much of your savings and even bill-paying.
For example, you may be able to have your employer send a specified sum directly from your pay to your savings account each pay period. Do so with, say, $400 twice a month, and you'll end up with almost $10,000 in savings at the end of each year.
For many people, that will be a painless way to save. For others, it may take some getting used to having less to spend on discretionary purchases -- or even finding more ways to save money, such as by heating or cooling your home a little less. Once you're saving more money, consider investing in stocks with your long-term dollars.
Participating in a 401(k) plan is another way to save automatically. Aim to sock away a lot, and to increase your savings regularly.
2. Change your food habits
For most of us, the sum we spend on food, whether it's dining in restaurants, grabbing a snack from a fast-food venue, or grocery shopping, is a hefty part of our overall budget. It's also a category we can shrink a lot.
One way to do that is by dining in restaurants less frequently. If you, with a partner or your whole family, eat out about three times per week, spending an average of $60 each time, you're looking at a whopping $9,360 annually. Cut that frequency in half -- dining out once this week and twice next week -- and you can save almost $4,700.
Another money-saving trick with restaurants is to just drink water and enjoy the food. Drinks, whether alcoholic or not, can be pricey and add up. Brown-bagging some or all your lunches during the week is one more way to save money.
At the supermarket, you might:
- Buy costly items such as steaks and shrimp less frequently
- Stock up on whatever is on sale
- Use coupons from weekly fliers
- Concentrate on not buying more than you need or will eat soon
- Buy only what's on your shopping list
3. Make some phone calls
Here's an easy trick for saving money -- all it takes is some phone calls.
If you're carrying debt on credit cards, you can call the card issuers and ask them to lower your interest rate because you're a loyal customer and don't want to have to switch to a card with a lower rate. Many times, this will work. Even if you're not carrying debt, if your card has an annual fee, you might call and ask that the fee be waived. This, too, has worked for lots of people. (Remember that many of the best credit cards have no annual fee, or smaller ones than you might be paying.)
Make some phone calls to well-regarded insurance companies, too, seeing if any can offer a lower premium rate for your same level of coverage -- for your home insurance policy, your car insurance policy, and any other policies. Each insurer will have different formulas and algorithms, and the one offering the lowest price may vary from year to year -- so make these calls every year or so.
4. Use credit cards strategically
Instead of just using any old credit card, put more thought into which card(s) you use for what, as there are a lot of dollars you could be reaping -- via cash-back cards.
Think about where you tend to spend the most money. If you send thousands of dollars per year to Amazon.com, for example, using an Amazon credit card could get you up to 5% back. Spend $300 at Amazon each month? You might get $15 back per month -- about $180 per year.
If you have a big family and spend a lot at supermarkets, you may be able to get up to 6% back on that spending -- and for someone who spends, say, $200 per week at the supermarket, that could get you $12 back per week, or $624 per year. These two examples alone total more than $800 in annual savings.
Lots of retailers have cards that give you around 5% back at their stores -- don't sign up for every one, but consider cards for the places you frequent the most. And if you travel a lot, look into the best travel cards, as they can save you hundreds of dollars, too.
5. Make a game of it!
If the money-saving strategies above don't sound like fun, this one might: Make a game of saving money. You might compete with just yourself or with friends. For example, below are a bunch of great contests to have with your friends or relatives, via my colleague Christy Bieber. She suggests you see who can:
- Go longer without making a purchase
- Go longer without dining out
- Have more no-spend days during the month
- Make the least expensive healthy meals for dinner
- Spend less on gas over the month
- Have the lowest electricity bill
- Deposit more cash in a savings account
- Engage in more free activities during the month
- Make more extra income from a month-long side hustle
Here are some additional ideas:
- See how brief you can make a supermarket (or mall) trip
- See how big a tax deduction you can get by donating clothing and household goods to charity
- See how much money you can net from a garage or yard sale
Even if you don't win against your friends, or you don't always hit a new high (or low) in a given month, you'll likely be saving a significant amount just by trying.
6. Look into refinancing your mortgage
Another powerful way to save money is by refinancing your mortgage.
Here's an example, via the Zillow.com refinance calculator: Imagine that you owe $200,000 on your house, and you have a 30-year fixed-rate mortgage at 5%, with monthly payments of $1,074. If you can refinance into a 30-year fixed-rate loan with a 4.3% rate, you might pay, say, $6,000 in fees, but with new monthly payments of $990 -- fully $84 lower.
Over the life of the loan, that could save you $100,000! (It will take about six years for the savings to offset the fees, so that's your break-even point -- if you don't plan to stay in the home for more than six years, refinancing isn't a great idea.)
Another way to refinance is into a shorter-term loan -- such as a 15-year one. With that, you'll face higher monthly payments, but will pay less in interest. You can have the best of both worlds by sticking with a 30-year loan while making extra payments against principal that reduce the life of the loan and the interest you'll pay.
7. Hike your insurance deductibles
An underappreciated way to save money is to raise the deductible on your insurance policies. It may feel comforting to have low deductibles, knowing that you'll never have to pay too much on a claim, but those low deductibles cost you more in premiums.
It can be smart to have relatively steep deductibles in order to enjoy lower premiums. Yes, now and then you may have to spend a big chunk when an expense rears its head, but that probably won't be too often, and in the long run, you're likely to save money.
As an example, a 2016 study by Quadrant Information Services found that raising a car insurance deductible from $500 to $1,000 saved an average of 8.5%, which for a $1,000 premium would mean $85 in annual savings. Raising the deductible from $500 to $2,000 averaged 15% in savings, or $150. Note that if your premium is $2,000, the savings would be $170 or $300 per year. Over 10 years, that could be $1,700 or $3,000 -- rather significant sums.
Just be sure to not carry a deductible that's higher than you could pay, if you had to.
There are lots of ways to get yourself saving more money. Do a little digging and a little thinking, and you may run across more strategies that would work well for you.