9 Practical Tips on How to Save Money

You may not be aiming for lavish wealth, but feeling prepared for unexpected bills, working toward a goal like a down payment, or simply avoiding credit card debt might be important. That’s where learning how to save money plays a role. Even small steps could help create meaningful progress and support your financial security over time.

Build Your Saving Habits

1. Start With Tracking Your Spending

If you're not sure where your money goes, you're not alone. One way to get clarity is by tracking your spending.

Ways to do this:

• Bank statements: Review 1–3 months of statements from your checking & credit card accounts.
• Budgeting apps: Try tools that categorize expenses automatically, like Rocket Money or EveryDollar.
• Manual tracking: Use a notebook or spreadsheet to log spending for two weeks.

This step helps you spot trends and make decisions based on real data. Knowing your patterns may also reveal opportunities to improve your net worth over time.

2. Break Expenses Into Fixed & Variable

Not all expenses behave the same. Some are consistent, others shift month to month.

Fixed costs like a mortgage or car loan generally require advance planning. Variable expenses like dining out or household shopping may offer opportunities to cut back.

Identifying these may help you carve out space for saving money, building an emergency fund, or exploring options like 401(k) plans and individual retirement accounts.

3. Consider Budgeting Methods That Fit Your Style

A budget doesn’t have to feel restrictive. Think of it as a spending plan designed by you and for you.

Popular approaches include:

• 50/30/20 budget: Spend 50% on needs, 30% on wants, 20% toward saving & debt payments.
• Envelope system: Use cash for specific categories to avoid overspending.
• Zero-based budgeting: Assign every dollar a purpose, even if it’s $0 left at the end.

Some people prefer visual tracking. Others lean toward budgeting apps. Whichever method helps you maintain financial stability and move toward your short-term goals.

You might also consider incorporating long-term goals like saving for a home down payment, contributing to 529 plans, or refinancing student loans.

4. Automate Savings

Automating small savings transfers might make it easier to stick with your plan.

Ideas to explore:

• Automatic transfers: Set up recurring transfers from checking to savings.
• Split paycheck: Direct a portion of your paycheck into savings.
• Round-ups: Some apps round up purchases & transfer the change into savings or investments.

Even $10 a week can build up over time, especially in a high-yield savings account. You could also consider routing savings toward individual retirement accounts, Health Savings Accounts, or other FDIC-insured deposit accounts.

These may help support efforts to manage finances and credit use over time.

5. Open the Right Savings Account

Types of Savings Accounts to Consider

• Traditional Savings Account: A basic savings option often linked to a checking account, offering low interest but easy access.
• High Yield Savings Account: Typically found at online banks, these accounts offer higher interest rates to help your savings grow faster.
• Health Savings Account: A tax-advantaged account for qualified medical expenses, available if you're enrolled in a high-deductible health plan.
• Certificate of Deposit: Lets you earn fixed interest by locking in your savings for a set term, with penalties for early withdrawal.
• Money Market Account: These accounts offers check-writing and debit access along with interest, often with higher balance requirements.

Many people also consider using separate accounts for different goals, like one for an emergency fund, another for travel or a short-term goal.

Save Money on Everyday Expenses

6. Save Money on Groceries Without Sacrificing Quality

Food is often one of the largest monthly expenses, but some small tweaks could help you lower your grocery bill and put more in savings.

Smart grocery shopping tips:

• Stick to a grocery store shopping list to avoid impulse buys.
• Compare unit prices for better deals.
• Use digital or paper coupons and cashback offers.
• Take advantage of loyalty programs.
• Buy in bulk if items won’t go to waste.

7. Save on Clothes by Thrifting & Buying Secondhand

Clothing can quietly become a major expense, especially for growing families or changing seasons. Shopping secondhand may help cut costs without sacrificing quality.

Smart clothing tips:

• Shop at thrift or consignment stores for discounted, gently used items.
• Browse online resale platforms like Poshmark, ThredUp, or Facebook Marketplace.
• Look for seasonal clearance sales at outlet stores or factory shops.
• Participate in clothing swaps with friends, neighbors, or local communities.
• Join store loyalty programs that offer discounts, rewards, or birthday coupons.

8. Cut Costs on Subscription Services & Digital Spending

Those $5–$15 monthly charges can sneak up on you.

Try this:

• Review your accounts for recurring charges.
• Cancel or pause unused subscription services.
• Consider bundled plans or shared accounts.
• Set calendar alerts before auto-renewals.

9. Look for Hidden Savings in Your Home

From energy bills to maintenance, your home could be a source of savings.

Ideas worth exploring:

• Upgrade to energy-efficient appliances.
• Install LED lightbulbs & low-flow showerheads.
• Use smart thermostats to reduce heating & cooling costs.
• Seal windows & doors to prevent drafts.

Final Thoughts

There’s no perfect formula for saving money, but that’s exactly why it’s worth personalizing. Whether you’re managing student loans, saving for a home, or just aiming to reduce financial stress, even small adjustments may help you move forward. You don’t have to do everything at once. Starting with one or two sustainable habits can be enough. Over time, these habits may contribute to improved financial well-being.

  See how you can help cut expenses and boost your savings. Get My Free Financial Review 

Sources

1. Next Gen Personal Finance. "Question of the Day: How much does the average American household spend on groceries each week?" https://www.ngpf.org/blog/question-of-the-day/question-of-the-day-how-much-does-the-average-american-household-spend-on-groceries-each-week/
2. Move.org. "Utility Bills 101: Average Monthly Cost of Utilities by State and Nationally" https://www.move.org/utility-bills-101/