If saving money were easy, we'd all have more-robust bank accounts. Unfortunately, most Americans are glaringly behind on savings, and the reason boils down to -- you guessed it -- overspending. In fact, 10% of U.S. adults admit to having spent too much over the past year, according to new data from Mass Mutual.
If you didn't exercise proper self-control on spending throughout 2018, a few key changes will put you in a better position to save more in 2019. Here are the ones it especially pays to focus on.
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1. Maintain a budget
It's easy to overspend when you have no means of tracking your expenses. If you want to reduce your spending in the coming year, start by creating a budget. This will show you where your money has been going, and where you have room to cut corners without too drastically impacting your quality of life.
2. Start automating your savings
You can't spend money you don't have access to. If you want to waste less money in 2019, arrange for a portion of each paycheck to land directly in either a savings account or retirement plan, depending on how well you're doing with the former. You should generally have at least three months of living expenses in an emergency fund; if you don't, send your money there first. If you're good on emergency savings, send your money into a 401(k) or IRA.
3. Institute the 24-hour rule for nonstandard purchases
An estimated 84% of Americans admit that they commonly fall victim to impulse buys. If you overspent this past year, part of the problem probably boiled down to getting tempted by sales and promotions. But if you implement the 24-hour rule, you'll be less likely to give in to impulses in the future. The rule is simple: The next time you're drawn to buy an item you haven't budgeted for, make yourself wait a full 24 hours before completing that purchase. If, after 24 hours, you're convinced you still want or need that item, then move forward (provided it doesn't land you in debt). Chances are, you'll often come to realize that the item in question is something you can easily live without.
4. Avoid dining out
In 2014, the average American household spent $2,787 on restaurant meals and takeout. And considering that most food establishments charge a 300% markup on what they serve, that translates into roughly $2,100 of wasted money. If you want to spend less in 2019, pledge to prepare more of your food at home, and save those restaurant outings for truly special occasions. Similarly, if you're deep in the throes of your busy season at work, by all means, grab some takeout when there's no time to cook; just get back into the kitchen the rest of the year.
5. Be smart about your vehicle
It costs $8,849 a year, on average, to own a vehicle, according to the AAA, but that assumes you can't get by with a compact car. If you can, you might shave close to $2,100 off your annual vehicle expense, since small sedans only cost an average of $6,777 per year to own and operate. Better yet, get rid of your vehicle entirely if you can manage with public transportation. A transit pass in Washington, D.C., cost $2,844 in 2017, and that's the most expensive public commute in the country. Compare that with $8,849 a year (or even $6,777), and it's easy to see why giving up a car might make sense.
6. Lower your housing costs
Most Americans spend more on housing than anything else. If you're intent on spending less in 2019, slashing that single expense is a good way to achieve that goal. You can accomplish this in a number of ways, whether it means downsizing to a smaller home or moving to a less popular neighborhood. Another option: If you own your home, see what you might save by renting. It could be the case that removing expenses like property taxes, maintenance, and repairs puts a bundle back into your pocket, even when you consider the tax breaks associated with ownership.
If you're beating yourself up over how much you spent in 2018, know that the new year brings a great opportunity to do better. Follow these tips, and you'll hopefully have something to be proud of come this time next year.
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