My budgeting plan for any big purchase

Saving money

My budgeting plan for any big purchase

These simple adjustments can lead to huge savings.

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My budgeting plan for any big purchase

Considering just how tricky saving money can be, it’s a shame that the art of being economical isn’t a larger part of our basic education curriculums across the country. In fact, only 21 out of 50 states currently mandate that high school students take a course in personal finance. And that lack of education creates a real disadvantage for today’s younger generations. Without the aid of a financial advisor, most economic knowledge is passed down from family and friends, creating a web of various and sometimes conflicting information.

Today, nearly ¼ of Millennials spend more than they earn, leading to never-ending credit card debt. Does that debt always come from overspending? Or is it more likely that emergency medical bills and car repairs are what get you stuck in the negative?

As we’ve discussed before, it’s a combination of both. We can’t do much about the latter, but we can do a lot to better prepare ourselves for those kinds of surprises. Small adjustments in your budget and spending habits can lead to some pretty fantastic results.

Let’s say you’ve got your eye on taking a tropical vacation with your spouse. First, you need to give yourself a budget. Do the research and figure out a price range for your destination, and then give yourself a target date by which you’ll need to have the money. Give yourself enough time to realistically get the dough together, but don’t make it so far away that the trip doesn’t feel like a reality.

Rethink Your Budget

Before you actually make your savings plan, you’ll need to assess your spending habits and find ways to reduce spending in nearly every category. It takes some work, but it’s all worth it in the end. I like to call it the Thrift Technique. It’s a way of living you can adopt in times of need. Here are the essentials.

Eliminate excess food and clothing spending.

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The first things to go? Buying coffee outside of the house and going out for lunch. A bag of coffee beans lasts 1-2 weeks and becomes a worthwhile investment after only 2 or 3 cups. And when you step out to buy lunch, you’re likely to spend $10-15. Buy some salad and sandwich ingredients and save yourself hundreds of dollars per month. We’re not saying you can’t treat yourself to one or two meals out once a week, but eating out daily isn’t fiscally responsible.

You’ll need to also cut back spending on hobbies and clothing. Take a break from buying books, records, and most unnecessary clothing/accessories. Most of us haven’t even read all of the books we own, so make that a priority. Plus remember, all you’ll need is a swimsuit when you’re lounging on the beach, so don’t worry about buying new clothes for a while.

Scale back on entertainment.

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Catching new releases at the theater is fun, but it’s tough to get out of the multiplex without spending an arm and leg on concessions and tickets. Stay home and watch movies instead. Movie lovers may reject this idea, but if that’s the case, you could still bring snacks from home or eat a big meal before you go and cut your outings in half. Same goes for concerts, plays, dance clubs, comedy shows, and other live entertainment.

Settle for a cheap bar band instead of a stadium show, or a free comedy show instead of a packed theatre, unless an act you absolutely can’t miss comes through town. Home entertainment is the most diverse it has ever been, and you’ll have more time than ever before to fully appreciate it while the Thrift Technique is in full effect.

Consider cutting the cord.

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In the same vein, it might be time to consider downgrading your cable package or losing it all together. With the variety of content available on Netflix, and the availability of sporting events and other live events on Hulu and YouTube TV, this area might very well be an opportunity to save.

If you don’t have some of these platforms, like HBO Go or Showtime, it’s worth reaching out to your family or friends to see if they don’t mind sharing a login. Most of these services allow multiple users to stream simultaneously, so that shouldn’t be a concern. If you miss the channel surfing, just picture yourself actually surfing on your tropical vacation!

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Reevaluate your commute.

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Do you live in a city where you can take public transportation by subway, bus, or high-speed rail? Get a monthly pass to your most convenient option and leave the car at home. You may find that you like the extra free time to read or listen to podcasts, and you’ll save tons on gas. If that’s not an option, consider carpooling with a coworker. Your gas costs will quite literally be cut in half.

And if you live in a small town, you may even want to look into walking, or getting a bike/electric scooter to get to work. So long as weather permits and the distance isn’t too far, you may find that you enjoy a more active commute.

Negotiate your insurance and credit card rates.

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If your credit score is good and your monthly credit payments are on time, you may be able to lower your interest rate. Just give your bank a call and make a case for it. Worst case scenario? They say no. Same goes with your mortgage and various forms of insurance. In fact, a lot of people overpay for their auto insurance without even knowing it, and there are numerous effective strategies for finding more affordable car insurance.

With a mortgage, you may be eligible to refinance and lower your interest rate if you’ve built a solid history of making payments on time.. Even if these differences are slight, every cent counts—calculate it for yourself.

Lower your utility bills.

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The first set of precautions you can take, you’ve likely heard before. Unplug your electronics when they’re not in use, use energy-efficient appliances and bulbs, ensure that all of your windows and doors are tightly sealed, and use your heater & A/C sparingly.


What most people don’t realize is that you can also contact your utility company to ask for a lower rate. Just ask "Do you have any promotions available that could lower my bill?" Most providers have deals, but don’t present them unless asked. You can even pretend that you’re seeking to switch to a different provider, and they’ll forward you to a retention specialist that will go out of their way to keep you on board.

Create a Brand New Budget

Once you’ve applied the Thrift Technique to your lifestyle and you’re officially a lean, mean, money-saving machine, you can reassess your budget.

You should have quite a bit more money in the savings column now, and that’s a fantastic accomplishment. You’ll need a plan for precisely how much money you can put away into savings. A popular method is the 50/20/30 system, which allows 50% of your income to go to bills, 20% to savings, and 30% to fun. That’s certainly a good baseline if it works with your current situation, but in the case of this hypothetical, you may need to adjust it.

If you follow the above steps to a T, you’d likely be using a modified 50/40/10 method. That’s going to be a pretty rough lifestyle to stick to, so give yourself some leeway. Maybe more of a 50/35/15 is more forgiving. Figure out what seems realistic to you, and stick to it. It’s just important that you have a plan.

Use Technology to Your Advantage

Once your new plan is in place, you’re ready to make it happen. You can set up an automatic transfer on pay day from checking to savings. That’ll be a guaranteed way to get those earnings tucked away without hesitation. And while you’re at it, you should look into the wide variety of rounding-up apps. Acorns, for example, rounds up all of your debit purchases to the nearest dollar, and then sends that money directly to your savings account.

You have an opportunity to be creative here, so we recommend you check out the wide swath of options out there. There are actually a wide variety of apps you can use to earn extra income as well, and many of them don’t require the time that typical side hustles require. Say you have an extra car that isn’t used regularly – you can rent it out with the Turo app. Survey apps like BIGtoken, for example, pay you monthly to answer surveys and check into locations.

Do everything you can to prepare yourself for success. Remember that odds & ends tend to show up throughout the year as well. Factor in your tax return, any bonuses that may be coming your way at work, and any expected gifts that may be coming down the pipeline. Above all, make a plan and stick to it. You’ll be more than satisfied with the results.

Comment below if you have any ideas or suggestions on how to better save up for a big purchase in the near future.

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Tina S. Rhodes
I’m Tina! I’m an avid hiker, adventure seeker and love all things blogging and finance… or am I?