Have you ever dreamt of retiring before 40? Or maybe your dream is to take a year off and travel the world. Whatever your dream life involves, living frugally can help you get there that much sooner.
Cut housing costs
Housing is one of the biggest expenses people have. Instead of living in a two-bedroom apartment, consider getting a one-bedroom or a studio. How much time do you really spend at home anyways? Spending 30% or 40% of your income on a place to go fo a few hours a day and to sleep is not wise. Reducing your housing costs can go a long way towards meeting your financial goals.
Take the bus
If you can, move into an apartment on a bus or subway line and give up your car. Not only will you be saving hundreds of dollars a month by not having a car payment, you’ll save on insurance, registration costs and gas. Plus, using transit means you won’t be stuck behind the wheel of a car, giving you an opportunity to walk to and from transit (hello gym membership savings!) and to listen to music or podcasts while being transported.
Get out of debt
Debt repayment is another large expense that takes up a lot of most people’s disposable income. Rather than wage war against your credit cards with sky-high interest rates, look into consolidation loans or personal loans. Using the money from these loans, you can pay off your high-interest debt and have manageable monthly payments. Paying off these monthly payments reduces the debt, saves you on interest costs and, more likely than not, raises your credit score which allows you to get even cheaper debt in the future.
Life is pretty hard. If you’ve got big financial dreams you might look around and wonder how some people can seem to afford everything while you can’t afford anything. Their secret is living frugally. By maintaining a frugal lifestyle with regards to your housing, transportation and debt repayment expenses, you’ll find yourself with lots of disposable income to put towards your financial goals. With so much disposable income, you might even decide to treat yourself to a luxury or two along the way to your financial dreams.