Money Saving Strategies

When it comes to saving money, let’s face it. Everyone struggles a little bit. We all have that one thing that we just need to buy (even though we don’t really need it). 

These expenses usually include things such as always having ice cream in your freezer or getting your morning Starbucks. But it also includes that new pair of shoes or getting a new iPhone because “you were up for an upgrade.” 

Now while I’m not saying “don’t buy your morning coffee” because I think that that type of financial advice is very cookie cutter and it won’t really move the needle in your life, I do believe that there is something to be said about changing that habit. I love Starbucks as much as the next guy, but try to kick it back a little bit.

Now for non-cookie cutter money saving strategies, I have a few of them here for you that I use daily when it comes to making purchases of any size.

24 Hour Rule

Did you know that most of our purchases are impulse purchases? Whether it be on Amazon or in a Walmart, chances are you don’t need what you are buying, you are just drawn in by the convenience of the product being in front of you.

money saving strategies, impulse buying

Money saving strategy number 1 is the 24 Hour Rule.

If you see something online or in the store that you may want, don’t buy it right away. 

Often eCommerce stores will flash things in your face like: “10 hours left in this sale” or “only 5 products left!”

These are used to tap into your cognitive biases and force you to purchase right now. Chances are, they aren’t running out. If they do? You can most likely find the product from a different vendor or store.

With that said, if you want to buy a new pair of shoes for $80, do this.

Don’t purchase. Go home. Sleep on it. 

If you still want the shoes the next day, then you know it isn’t just an impulse buy.

When it comes to larger purchases like a new TV, a car or other items over $500, I usually give myself a week or even a month to think about it. That way you have a ton of time to assess your living situation and see if you truly need to splurge on that item.

How Many Hours Will I Need to Work?

This is one of the well known money saving strategies out there. 

At the end of the day, you work for your money (unless you have passive income). 

If you have a job, you are trading your time for your money. So let’s think about that when making that purchase.

If you make $20/hour at your job and you want to buy a new $600 TV, you need to work 30 hours to get that TV. 

When you put it in these terms, you might not want to buy that TV.

You can even relate this to eating out. Going out with your friends or significant other to eat at a fancy restaurant or bar can run you $100-$150. Do you want to work 5-8 hours just for that meal?

Now I understand that we’re people, not robots. We need to kick back, unwind and celebrate our hard work every once in a while. Plus, if you have a girlfriend, good luck telling her that you’re staying in and making mac and cheese instead of going out to a nice dinner on a Friday night… Everyone deserves to reward themselves from time to time, but don’t make a habit of it! 

Future Value of Money

When it comes to buying small things that I know I don’t really need, this strategy makes me think twice. 

Now stick with me, because it’s a little out there.

But $5 invested in an S&P 500 Index Fund over 40 years averaging 7% per year, turns into $75! 

When I go to buy a Starbucks coffee, is it really worth $75 when I retire? (I know, it’s crazy to think like this, but I’m a finance freak). 

money saving strategies can help you earn money in the long term
One coffee invested in an S&P 500 index fund over 40 years at 7% annual return will give you $75!

I am a true believer in making your money work for you, so that one day you won’t have to work for money. So this strategy is a way that I force myself to focus on delayed gratification and stop those small meaningless purchases.

Now if you get 4 coffees a week for a year ($5 * 4 days * 52 weeks = $1,040) and invest that in an Index fund over 40 years…

can cutting back on coffees help you retire early?
$1,040 invested over 40 years turns into over $15k!

If there’s one thing that this shows, is that small savings here and there add up. 

If you have no idea what an Index Fund is and why you should invest in them, check out this beginners guide.

If Someone Offered Me The Cash Value, Would I Take It?

I came across this strategy lately and it’s an interesting one. Out of all of these money saving strategies, this one is the biggest shift in mindset from how we make purchases.

If you wanted that $80 pair of shoes and instead of buying them, I offered you $80, would you take the money or the shoes?

Of course, it depends on your situation. Do you need new shoes? Are your shoes destroyed? If so, you probably pick the shoes. But if you are buying them just to buy them, you might take the money. 

This is one that I don’t put much emphasis on because it is a little flawed, but it is certainly an interesting way to think about purchases you may not need.

Other Money Saving Strategies

Automatic Savings

I set up automatic transfers each month to my investment accounts as well as my savings accounts. 

When you set up automatic transfers, it becomes easier to spend less money, because there is less money in your checking. 

If you want to save for your emergency fund and for a down payment for a home, consider having two different savings accounts, so you don’t mix your funds!

Also, consider opening your savings accounts with different banks, so when you log onto your banking app to see your checking, you don’t see your savings amount and you’re not tempted to transfer money to your checking!

Put a 20% Tax on Yourself

When it comes to saving money and more importantly, building wealth, you need to buy into this. 

Before spending any bit of your paycheck, take 20% of it and put it to your savings and investment accounts.

If money is already tight, consider this.

If the government went and added another 20% tax onto our income, we’d all be pissed off. We would all sit here and complain. But you know what else we would do? We would all pay it. 

We would find a way to adjust our living expenses to cater to this 20% tax. 

The great thing is, is this tax is for your future self. You saw above how your money can grow over time. So it’s time to start. Put that tax on yourself and begin saving today because the earlier you start, the better

Budgeting Apps

If this is all overwhelming and you want someone to help you save money, there are so many apps out there that help you stay on top of your finances. At the end of the day, everyone needs a budget. I have reviewed my favorite budget apps in a recent blog post.


We all splurge on things from time to time and that’s okay! We all deserve to celebrate our accomplishments and unwind from the stresses of life from time to time. But it’s important to understand the long term potential of your money. 

I know you don’t want to work for the rest of your life, I know I don’t. Using these money saving strategies and investing heavily in your 20’s and 30’s gives you the best opportunity to retire early (unless you start a business).

If you have other strategies that you use, please let me know in the comments below! I love to hear from my readers on new strategies!

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