You’ve probably told yourself at least a thousand times that you should be investing more toward retirement. But to invest more, you have to save more. Ah, there’s the rub.
You probably feel that saving money is tough. After you pay for your mortgage, utilities, car payment, groceries etc., there’s not much left. But it doesn’t have to be all that difficult to find some extra cash to invest for your golden years. You don’t have to wait until you hit the lottery or get a six-figure inheritance.
Of course, it’s true that you’ll have to make some tradeoffs when it comes to your budget. But once you see how powerful you’ll feel when you save some extra cash, you just might be motivated to figure out even more ways to cut your budget.
Here are a few ideas that can help you reduce your budget and increase the money you have to invest:
- Save Your Raise – Consider increasing your retirement contribution every time you get a raise or bonus until you max out on your eligible contribution. You got along fine without that money in the past, so don’t just spend it because it’s there.
- Change Your Subscription Plan – Do you really need all those TV channels, especially in the age of cheaper digital alternatives? According to September 2015 data from the Leichtman Research Group, the average paid subscription TV customer is shelling out $99.10 per month for the service, 39% more than they paid in 2010.
- Other options can save you a ton of cash that you could use to invest in your retirement account. According to a 2014 report by PricewaterhouseCoopers , subscriptions to cable alternatives like Netflix, Amazon Prime, and Hulu – each of which costs around $8 a month – are on the upswing. It’s not too hard to figure out why. Opt for one of these services and you could save an average of $91 month. That adds up!
- Cut Transportation Costs – If you live near co-workers, carpooling can be a great way to slash your budget. You can even take public transportation a few days a week. In either case, you’ll not only save money on gas, but also reduce the wear and tear on your vehicle, so you’ll also save money on costly repairs.
- Make A List And Check It Twice – Before you go grocery shopping, make a list of the products you need for the week and only shop for the things on that list. That way, you won’t spend money on things you don’t need. If you buy coffee regularly, wait until it goes on sale and then stock up. And forget the brand names – stick to generic products. In many cases, they’re just as good and they cost much less.
- Turn Down the Thermostat – Heating your home accounts for the largest portion of your electric or gas bill, according to the U.S. Department of Energy. Try setting your thermostat back a few degrees or install a programmable thermostat that will lower the heat automatically during the day when no one is home, as well as at night when you’re asleep under warm covers.
- Give Up Your Gym Membership – This doesn’t mean you should give up exercising. It just means you can go for a run in your neighborhood, ride your bike, and even do some jumping jacks, push-ups, and crunches at home. Download a fitness app to track your progress, get workout ideas, or connect with a community of people who will offer you support.
Follow these tips and soon you’ll be motivated to find even more ways to cut your budget and save money for your retirement. Before you know it, your 401(k) could be clocking in at $401K.