8 Ways to Save More Money This Year

My friend Holly and her Hubby are great money savers. In fact they have already paid off their house and are in their early 30s. Wow! So I asked them for a few money-saving tips that they’ve learnt to encourage all of us to start the new year out right.

1) Tithe

First and foremost, we take God’s word seriously on tithing. We give 10% of our gross income faithfully to our home church. Above and beyond, we give offerings to our favorite local charity and anywhere else that God leads us. God blesses a cheerful giver!

2) Know what you are spending.

If you don’t have any idea what your monthly bills add up to, how can you know if you are saving any additional income? We have a spreadsheet where we have listed all of our expenses, our investments, and our “free money” that we have to spend on whatever we choose. Even just getting out a pad and paper and tallying all your expenses is an eye-opening experience!

3) Have an emergency fund.

Now that you know what your monthly bills add up to, multiply that by at least six and that is the minimum amount of money you should have saved in the event of a lost job.

4) Look for areas to cut back in

Do we really need hundred’s of TV channels? We pay $14 a month for cable because this is an area that is not too painful for us to cut back in. We had texting removed from our cell phones because this was a feature we just never used and would get charged for incoming texts. I’d encourage you to take a look at your monthly bills and ask where you can cut back or make a sacrifice to save money.

5) Set financial goals for yourself.

Both long term and short term. Examples: In one year I will have saved X amount of dollars, paid off my credit cards, etc. I will do this by making a monthly sacrifice by not going out to dinner one less time/week. Make the goals realistic and attainable.

6) If you have credit card debt, we highly recommend only cash spending.

However, if you do not, I’d recommend that you find a rewards program and spend only through it. For example, we have a Discover card and put pretty much everything we spend on it in order to earn between 2%-5% back on purchases. I would HIGHLY caution you to only do this if you have the means to pay off your bill in full every month. The rewards will certainly not trump the interest you’ll be charged!

7) If you are paying off a home, pay above your minimum monthly mortgage payment.

Let’s say you have a 30 year mortgage on a $200,000 home at a 5% interest rate. Not taking into account for a down payment, your minimum house payment would be around $1,000/month putting the total cost at the end of the 30 years at around $385,000. Now if you are able to pay just $50 additional every month the end total would be around $365,000 saving you $20,000 over the course of your loan and you would pay off your home three years early. That’s staggering! The additional payment goes strictly towards the principal, which will in turn save you all that interest!

8) Invest invest invest!

The sooner you start, the better. There are countless ways to invest and you’ll need to find out what is the best way for you: 401K, CD’s, savings accounts, etc. The return isn’t much these days, but the key is to put that money aside and don’t touch it! We would recommend investing at least 10%-15% of your gross income. It’s never too late to invest and the time is NOW!

Ben and Holly Kietzman live in Springfield, IL where Ben works full time for AT&T and Holly works part time at a local hospital. One of their passions is living a financially wise lifestyle and they love to see others grow in this area as well. They paid off their house in 7 years and have been 100% debt free for over a year. They would welcome any comments or questions.

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