30 Ways to Lower Your Monthly Bills

Do you ever feel like your money just flies out the window as fast as it comes into your pocket?  Or like you just aren’t saving money as fast as you’d like to?

I know: spending less money doesn’t sound like a ton of fun--at first glance.  But here’s the deal: The better you get at learning to lower your monthly bills, the more extra cash you’ll have to sock toward retirement investments and other saving and investing ventures.

And as you start seeing how lowering your bills makes your investment accounts multiply, you’ll start getting pretty excited about spending less money each month.

So start envisioning a plusher net worth and try these cost-cutting measures on for size.

How to Lower Your Household Bills

1. Consider geo-arbitrage
2. Stop using so much electricity
3. Turn the thermostat down (or up)
4. Reconsider private mortgage insurance
5. Ease up on water usage
6. Shop around for garbage service
7. Use a menu plan
8. Take advantage of sales
9. Know where the prices are lowest
10. Stay away from budget busters
11. Buy generic brands
12. Get rid of your car payment
13. Keep your car maintained
14. Use public transportation
15. Walk or ride a bike
16. Carpool or use a rideshare service
17. Trade your car for a more fuel-efficient model
18. Comparison shop for auto insurance
19. Have a closet swap party
20. Go on a clothing fast
21. Shop at thrift stores
22. Stick to the clearance rack
23. Limit extracurricular activities
24. Set limits on non-necessity purchases
25. Give your kids a clothing allowance
26. Re-think your gym membership
27. Find cheaper beauty and self-care options
28. Find free entertainment options
29. Start packing your lunch
30. Pay off your debt

Save Money on Housing Costs

Whether you own your home or rent, we’ve got some great ideas for reducing housing expenses.

1. Consider Geo-arbitrage

In a nutshell, geo-arbitrage means moving to a lower cost-of-living location.  For instance, if you live in a high-rent city such as New York or San Francisco, you’d move to someplace with much cheaper rent options.

Or, if you’re a homeowner with a $300k+ home you’d move to a home valued at under $200k. The point is to live somewhere that’s just not so darned expensive to live.

The fact is, housing costs - especially a mortgage or rent - represents most people's largest monthly expense, so trimming back can be a one-hit way to massively reduced outgoings.

Yeah, I know: A jump on the geo-arbitrage bandwagon might mean switching jobs or moving further from family or friends.  Or…..it could mean moving closer to family or friends.

But if you do it right, it will definitely mean saving huge money on housing costs.

2. Stop using so much electricity

Something happened to me when I became a homeowner. I suddenly became very aware of how much electricity costs and my energy bills.

Adding four kids into the mix made me hyper-vigilant. Soon I was following them around the house, chastising them for leaving lights on when they left the room.

But you know what? It worked.  By working hard to not use electricity where it’s not needed, I’ve slashed my electric bill by over 25 percent. 

That’s a savings of over $450 per year where I live.  This approach to paying bills can be applied elsewhere too. Have a gas supply? Reduce your use.

Chunky cell phone bill? Big cable and internet bills? Again, cut back where necessary.

3. Turn the thermostat down (or up)

Save some cash on your heating and AC bills by keeping it a little bit colder in the winter and a little bit hotter in the summer.  Your body will adjust to the different temperatures soon enough.

4. Reconsider private mortgage insurance

Private mortgage insurance is only required if you have less than 20% equity in your home. If you have more than this, you can think about ditching the homeowners insurance coverage and save the money instead.

This isn't right for everyone and does carry some risk - but if you feel like it's money wasted, it's a good idea to talk to your mortgage provider about whether it could work for you.

5. Ease up on water usage

Turn your faucet down when you’re doing dishes. Don’t leave the faucet running when you brush your teeth.  Use a water-saving shower head in the shower. Reduce or eliminate lawn watering.

All of these water-saving tactics will result in money savings if you have a municipal water supply.  If you’ve got “free” well water, it’ll help the environment and ease up on your well usage.

6. Shop around for garbage service

If you don’t have city-led trash service, try shopping around for the lowest-priced provider.  I saved over 40 percent on my trash bill by doing so.

Often times, trash haulers will give you deals for switching to their company.

Save Money on Groceries

I’m a mother of four that feed her family on less than $600 a month--and largely organic foods at that.  Here are some of my tricks for saving money on groceries.

7. Use a menu plan

This is a trick I learned from my own mom when we were young kids and living on welfare. You start by making a list of 14 dinner ideas for the next two weeks (or seven for the next week--whatever works for you).

Then take your shopping list and write down what ingredients you need to make those dinners. Add in other budget necessities like milk, butter and breakfast and lunch foods.

As you shop, stick to your list. The menu plan idea helps ensure you’ve always got a dinner idea in your back pocket.  This will help you avoid impromptu drive-thru, takeout and restaurant runs.

8. Take advantage of sales

Another tip I use to save money on groceries is to base my menu plan and weekly shopping list around what’s on sale.  For example, if chicken is on sale we’ll be having a lot of chicken-based dinners.

If strawberries are on sale, the kids and I will be eating strawberries for most of our snacks.  And when something we use regularly goes on sale, like spaghetti sauce, I stock up and take advantage of the savings.

9. Know where the prices are lowest

When it comes to buying groceries, the lowest priced stores in our area are Aldi, Walmart, Costco and Sam’s Club. Therefore, I buy all of our groceries at these four stores.

I know which stores have the items we buy at the best deals, and I make my shopping list accordingly.  It might seem counterproductive to run to three or four different stores.

However, I make sure to plan my trips in a way that has me shopping when I’m in the area of each store.

10. Stay away from budget busters

There are certain food purchases that are total “budget busters”. You’ll save more money on groceries if you try and keep these purchases to a minimum--or avoid them altogether.

• Processed meals
• Snack foods like chips and store-bought baked goods
• Sodas and energy drinks
• Prepared dinners

Yes, we only buy soda when we’re having a party or other special occasions. The kids and I drink water if we’re thirsty.  And we always make baked goods from scratch--it’s cheaper and better for you.

11. Buy generic brands - When it makes sense

Budget experts love to tout buying generic. However, that’s not always the best option.  If you buy generic spaghetti sauce and the family hates it, you’ll probably end up throwing it in the garbage.

Or worse, you’ll cringe at the thought of having it for dinner and order takeout pizza.  We like to make it a fun little game to try out generic brands of different foods.

If we like them, they’ll stay on our regular grocery list.  If not, we chalk it up as a failed experiment and go back to our name-brand favorites.

Save Money on Transportation

Transportation can be another budget-busting expense, but there are ways you can cut costs in that area too.

12. Get rid of your car payment

As a FIRE (Financial Independence, Retire Early) enthusiast, I’ve learned to thoroughly enjoy driving older, paid-for cars.  If you love your money and having more of it, the monthly car payment is your nemesis.

If you’ve given in to the mindset that says you’ll always have a car payment, consider trying something new.  Search until you find a well-running car you can pay cash for.

Don’t be concerned with how it looks or what kind of “extras” it has.  Simply look for something that’s dependable and fits your basic needs.

Spend a year driving that paid-for car and put your would-be car payment into a savings account.  I’m willing to bet you’ll be very happy with your new, higher net worth.

13. Keep your car maintained

Keeping your car properly maintained is another money saver.  Even though it might feel like you’re spending more money at the outset, you’ll save more money in the long run as you avoid/minimize repairs that come with neglect of basic maintenance.

Get your tires rotated and balanced every six months. Change your oil regularly.  Replace brakes, shocks and struts, belts and other maintenance items when needed.

Taking care of your car is like taking care of your body: preventative measures usually help you avoid expensive repairs.

14. Use public transportation

If you work at a place on a local bus line, you’ll probably save money on transportation by using the bus or subway to get to work.  You’ll save money on gas, maintenance costs and potentially on parking costs as well.

Some employers even consider these to be 'out of pocket costs' which they may reimburse later.  Either way, weigh out the costs of using public transportation as opposed to driving yourself and see how much you can save.

Don't forget, bus/train ride tickets for commuting can be considered expenses, so could even reduce your overall income tax bill.

15. Walk or ride a bike

Do you live in an area with a high walkability rating?  If so, try walking or biking to get where you need to be. Whether it’s to work or to casual destinations like the grocery store or library, walking or biking has a two-fold benefit.

First, it will save you gas money along with the wear and tear on your car. Second, it will help you improve your health - which in turn could reduce medical bills going forward.

Bonus benefit: You get more time to enjoy the scenery on the way to your destination.

16. Carpool or use a rideshare service

How about carpooling with a coworker for saving money on transportation?  If there’s a coworker that lives near you, you could take turns driving to work.

You could also use a rideshare service such as Uber or Lyft when you go places.  You’d have to add up the cost of rideshare services--including tip--to do a price comparison.

However, you may find that ridesharing costs less than driving and parking your own car.

17. Trade your car in for a more fuel-efficient model

Could you be driving a more fuel-efficient car to save money?  Some people need larger vehicles for work or family life purposes. Others prefer to drive larger vehicles for safety’s sake--and that’s okay too.

However, you might be able to find a more fuel-efficient vehicle that fits all of your needs and personal preferences.

Car makers are focusing more each year on producing more fuel-efficient vehicles in all sizes.  Do some research and see how much money you can save by switching to a more fuel-efficient vehicle.

18. Comparison shop for auto insurance

In 2016, I decided to do some research and shop around for car insurance. We’d been with the same insurance company for many years, but I really needed to reign in our budget at the time.

After looking at a few different companies, I found I could save over $400 a year by switching to GEICO--for the same coverage.  I made the switch and haven’t looked back.

Since then, I’ve encouraged a few friends to do some comparison shopping as well--three out of the four of them found lower auto insurance rates.

Do some shopping around and see what you can find. Just be sure you’re comparing the same type of coverage as you shop.

Save Money on Clothes

Clothing can be expensive--especially if you (or your kids) are hooked on expensive name brands.  But even if you are, there are still ways you can save money on clothing.

Here are some of our favorite ways to save money on clothing expenses.

19. Have a closet swap party

One of my coworkers holds an annual closet swap party. Everyone brings a few items from their closet they no longer wear.  We have some wine and some appetizers. Then we go “shopping”.

Everyone leaves with a few new items to refresh their closet--for free!

20. Go on a clothing fast

How about going on a one-year clothing fast?  Yep--just live off of what you own and appreciate what you have.  Then take the money you would have spent on clothing and use it to better your money situation.

21. Shop at thrift stores

My oldest daughter--a 20-year-old--has fallen in love with thrift store shopping. Once she turned 19, I told her clothing purchases were on her own dime.

She has a soft spot for new clothes but a part-time income. Enter, the local thrift store.  The clothes are cute (and often name brand) and she gets them at a tiny fraction of the price she’d pay new.

Hint: Try local garage sales--especially city-wide sales--as another option for cheap used clothing.

22. Stick to the clearance rack

I don’t know what it is, but my third oldest daughter just won’t buy used clothes. It’s not a pride thing so much as it’s a germ thing.

How do I keep my clothing allowance in line with her?  Lots of visits to the clearance rack. You can’t beat clearance racks for great deals on clothing--no matter what the store.

Hit them at the right time and you can get 75% off or more on retail prices.  As my mom likes to joke, her favorite designer is “clearance”.

Save Money on Kid Expenses

There’s no arguing that raising kids is expensive. The USDA tells us it costs over $230,000 to raise a child to the age of 18.

How can you help trim that number down?  Here are some ideas.

23. Limit extracurricular activities

Studies show that extracurricular activities can have a very positive effect on a child’s self-esteem and confidence.  However, they can also have a large impact on parental wallets.

One way to combat those expenses is to limit extracurricular activities to one or two per year. As parents, it’s easy to want to give your child every opportunity available to them.

However, you can always spend non-activity seasons doing other, less expensive activities. You can plan activities for the entire family, such as game nights, movie nights or geocaching.

Or you can fill their time with volunteer opportunities such as helping out at the local food shelf.

24. Set limits on non-necessity purchases

Another popular trend in parenthood is to give your kids everything they ask for.  I made a rule when the kids were young that I’d only purchase non-necessities like toys for birthdays and Christmas.

If they wanted something outside of those times, they’d have to earn the money themselves. They could earn the money they wanted by doing any number of chores for us or those close to us:

• Household chores like cleaning or mowing the lawn
• Babysitting
• Cleaning or organizing for us
• Washing the cars
• Other jobs as needed

I found this to be a great way to limit non-necessity monthly spending--and to get chores done that I needed to be done but didn’t have time to do.

25. Give your kids a clothing allowance

One way to keep kids' clothing purchases in line is to set a monthly or annual clothing allowance limit. My mom did this with me and my brothers and it worked great.

She set us an annual limit at school shopping time in August. We were allowed to spend the money any way we wished.  If we wanted to buy one or two big-ticket name brand items, we could.

If we wanted to buy dozens of items at thrift stores or off clearance racks, we could do that too. But once the money was gone, it was gone.

This tactic helped mom keep her monthly budget in line and helped us learn about responsible spending too.

Save Money on Fluid Expenses

Non-necessity purchases can make a major disaster out of one’s budget. In 2013, I made a commitment to overhaul my finances.  As a part of this process, I conducted a rearview assessment of my prior year’s spending.

What I found was shocking. I “thought” I was spending about $100-$150 per month on lattes and drive-thru runs.  The number was closer to $275 a month.

I “thought” I was spending about $600 a month on groceries. I was spending about $900 a month.  Each spending category showed the same story: much higher spending than what I thought I was spending.

Suddenly, the reason why my credit card balances kept rising became crystal clear.  I made an immediate decision to do two things:

• Start keeping an eye on my spending by using a spend tracking spreadsheet (I made one up using Excel, but you can use Personal Capital to make it easy and free)
• Reduce or eliminate non-necessity spending

Here are some non-necessity expenses you can ditch in order to make your bank account fluffier.

26. Re-think your gym membership

Gym memberships can be great--IF you use them. Getting--and staying--healthy is a great way to minimize medical expenses.  However, if you only go to the gym once every couple of months you’re simply giving money away.

If you don’t use your gym membership, cancel it immediately.  If you do use it, consider these alternatives:

• Switch to a cheaper gym with less frills, such as a SNAP Fitness or Anytime Fitness
• Do your workouts at home or in local parks
• Join a workout club such as a running club--they’re usually quite a bit cheaper than gym memberships
• Ask if your current gym has a cheaper membership option
• See if you can add a friend to the membership and split the cost

My guess is that even if you do work out regularly, you can find a way to slash your gym membership costs.

27. Find cheaper beauty and self-care options

Salon costs for beauty and skincare services can be astronomical. In my low cost-of-living area, it costs me $200 to get my hair cut and highlighted.

Now, before you cry “hypocrite”, know that this is my one beauty splurge--and I only do it twice a year. It’s part of my value-based spending plan.

(A value-based spending plan is where you decide which of your monthly expenses are vital to quality living, and which aren’t.). But there are other ways I reduce beauty and self-care costs--and you can too.

For instance, what about doing manicures and pedicures at home? Or facials at home?  How about cutting your kids’ hair yourself?

A quick YouTube video can show you how to do that properly.  Or, skip your local spa treatment for a hot bath with sea salts and relaxing music in your own tub.

Need that monthly massage to reduce stress?  Ask your partner about scheduling massage appointments with each other. You give them a massage one day, they give you a massage the next.

Again, YouTube is a great resource for learning to do all things DIY.

28. Find free entertainment options

Entertainment costs can ruin a budget pretty quickly--especially if you have kids.  With my family of six, we can’t go out to eat or to the movies for less than $100.

For that reason, we work hard to keep costly outings to a minimum and find free or cheap entertainment.  As an example, we’ll rent a movie on YouTube instead of going out to the movies.

We bought an air-popper for popcorn, and we’ll use it to make popcorn at home from scratch for less than two dollars.  If I'm feeling extra extravagant, I’ll let the kids buy 98-cent theater candy from Walmart.

Instead of going out to eat, we’ll make our favorite restaurant meals at home. For example, this Better Than Olive Garden Alfredo Sauce is a family favorite.

We make it for extended family gatherings too, and it’s always a hit.  Packing a lunch and hitting local hiking or biking trails is another idea for free or cheap entertainment.

This article on 103 Things to Do on a Money-Free Weekend will give you plenty of other ideas for having fun without spending money.

29. Start packing your lunch

If you work outside of the home, you might be spending a lot of money on lunch and snack costs.  For instance, if you’re spending $15 a day to eat during work then you’re taking a painful $300 a month away from your saving and investing goals.

Why not start packing your lunch and snacks?  Bring leftovers from the previous night’s dinner. Make a sandwich. Bring your coffee from home.

Bake some cookies, freeze them and take three or four to work each day as a snack.  Yes, you have to eat at work.  However, you don’t have to pay someone else to feed you with expensive restaurant food.

Not sure about packing a lunch every day?  Try it one or two days a week and work up from there.

30. Pay off your debt

One of the biggest ways to save a lot of money fast is to pay off your debt - especially personal loans and credit cards. Let me give you an example. 

Let’s say you’ve got a credit card with a balance of $15,000.  The interest rate is 18% and the minimum payment is two percent of the balance.  

Your minimum payment on that card will be $300 per month. And you’ll be paying $225 in interest each month on that credit card debt.

It’ll take you dozens of years to pay off that card if you’re only paying the minimum payment. And you’ll spend thousands of dollars on interest charges.

Some credit card companies will help you adjust your monthly payments to reduce this quicker - but many more don't.  Do your wallet a favor and transfer your consumer debt to a low or zero-interest introductory rate credit card or personal loan.  

Then get that card or loan paid off as soon as humanly possible.

Get Off the Couch & Start Lowering Your Monthly Bills!

Use these tips to lower your monthly bills. Then take the hundreds (or thousands) of extra dollars you’ll have each month and invest it.  Stick it in CD at one of the banks with the highest CD rates.

Invest in the stock market. Buy a rental property. Just find a way to make it grow and earn you some compound interest.  Then watch as your net worth gets bigger each and every year.