If you're living paycheck to paycheck, you're either not earning enough or spending too much. You can create more room in your budget if you drastically cut your expenses. This will give you extra money without needing to increase your income. That extra money can be used to pay down debt or build up your savings.
Cut food & grocery expenses
Plan your meals for the week ahead of time, taking into consideration what you already have at home.
Check your local stores for coupons and what’s on sale and build your meal plan around those items.
Find cheaper substitutes for recipes or leave out non-essential ingredients altogether.
Build your meal plan for the week based on the cost per serve and the serving size of each batch. This is an easy way to drastically cut expenses because you're not just cooking at home but you're cooking meals that are actually affordable. Just because you cook at home doesn't mean you automatically save money. You can still be spending a lot of money by cooking at home if you're not cooking meals with affordable ingredients.
Maintain inventory lists of what you already have at home in your fridge, freezer and pantry to avoid buying what you already have.
Choose cheaper cuts of meat e.g. chicken thigh fillets are often cheaper than breast fillet.
Meal plan for more filling or satisfying foods - these meals will stretch further, so you’ll be shopping less often.
Plan meals using less meat or meat substitutes e.g. using stock instead of actual meat.
Leverage meals with leftovers that can be reheated the following day. Leftovers are great because it gives you a break from cooking but also means you can buy ingredients in bulk.
Make meal planning budget friendly & easy!
Your FREE meal planning workbook includes:
- Inventory lists for your pantry, freezer & fridge;
- Weekly meal planning sheet;
- Recipe cards;
- Shopping list;
- Dividers for your recipe binder!
Cooking at home
Sacrifice quality and pick cheaper alternatives for things that don’t matter that much to you.
Stretch recipes to last more than one meal using filling side dishes such as pasta or rice.
Set an actual grocery budget and align it with your meal plan and home needs.
Read recipes carefully - they often include extra ingredients for garnishes that you don’t really need.
Grow your own herbs, fruits and vegetables - but keep a close watch on your gardening expenses.
Have some emergency freezer meals on hand to avoid eating out or unplanned grocery trips when you don’t have time to cook or plans change. It's a lot cheaper to heat up a frozen pizza than to order pizza.
Store your food properly so that it lasts longer and to avoid waste.
Use a reusable water bottle and water filter instead of purchasing bottled water.
Plan your shopping
Never shop on an empty stomach. You’ll end up shopping with your stomach and not from your shopping list.
Always create a shopping list before going to the store and stick to your list.
Give yourself a time limit for shopping and don’t shop when you’re bored - otherwise, you’ll meander through the store and add things to your cart that you don’t really need. We often “feel like eating” when we’re bored and buy things we don't need.
Shop less often (no more than once per week) - you’re less likely to exceed your budget if you’re not running to the store every day.
Check prices for meat and fresh produce at the butcher or greengrocer - prices can be lower here than at the supermarket.
Use reusable shopping bags instead of paying for plastic bags every time you shop - keep some in your car.
Check for store loyalty or rewards programs that can give you special discounts or rewards when you purchase - but don’t purchase just for the rewards.
Shop at local ethnic markets particularly for spices - you can buy them in bulk for much lower prices than mainstream supermarkets.
Only buy what you’ll use or freeze any excess. This will help keep costs low and reduce waste. Your meal plan will help with this.
Shop at cheaper local stores such as ALDI or Costco, or from Amazon.
Don’t buy what you can make or prepare from scratch yourself - you pay more when you’re paying for convenience.
While you're grocery shopping
When non-perishable goods are on sale, stock up based on your budget and storage.
Buy generic brands or store brands - the quality is often the same if not better than name brands. This is an easy way to drastically cut expenses because brand names are often more expensive.
Buy perishable food items in bulk and freeze them.
Fruits and vegetables that are out of season are much more expensive - buy them frozen if you need them right away, or try to avoid them altogether until they're in season.
Stay away from prepackaged items. You can usually buy them without the packaging, and portion them into your own jars and zip-lock bags.
Instead of buying frozen food items, buy them fresh when they are in season and on sale and then freeze them yourself.
Check the cost per unit and compare prices to pick the cheaper alternatives.
Use the calculator on your phone to add up prices as you add things to the cart while shopping in-store. This makes it easier to stay within budget and you’re not surprised at the checkout.
Shop online if you can get free delivery or free pickup - there's less temptation for impulse purchases and it’s easier to stick to your list.
Opt for fresh fruits and vegetables only when they are in season. They’re often cheaper due to higher supply.
When shopping, look at the shelves above and below your eye line. Brands often pay top dollar to be placed directly at the line of sight, so those above and below the eye line are often cheaper.
Buy refills of spice or grain products instead of buying them in the new glass or plastic bottles every time.
Check your receipt to make sure you weren’t overcharged or double charged and any applicable promotions were applied correctly.
Learn to cook your favourite restaurant meals at home - it’ll be cheaper than going out, so you’ll get to enjoy it more often.
Pack lunches for work/school instead of buying lunches. Leftovers from dinner are great for packed lunches the following day.
Alcoholic drinks are often the most expensive part of a restaurant meal. Have drinks at home before going out to eat.
Split the main dish at a restaurant with your friends or your date. You can also opt for ordering a few different dishes to be shared.
Don’t leave your leftovers at the restaurant. Ask the restaurant staff to pack up any leftovers - now you’ve got lunch for tomorrow!
Make your own coffee at home and take it with you.
When you’re at a cafe or buying coffee, resist the temptation to order a slice of cake with your coffee.
If you’re buying coffee, take a reusable coffee cup with you from home. You’ll often get a discount for using your own reusable cup.
Bring your own snacks and drinks when you go out, or buy them from a discount supermarket close to your destination.
Cut household expenses
Check your utility usage on your bills, particularly for utilities like internet, where you’re paying for allowed usage as opposed to actual usage. Don’t pay for more than what you use.
Call your utility and insurance companies and ask for lower plans and lower rates. Don’t be afraid to threaten to switch providers.
Electricity & Gas
Unplug or turn off appliances at the wall when not in use.
Use LED or other energy-efficient light bulbs.
Turn off lights, fans and air-conditioning in empty rooms.
Wear warmer clothes and use warmer blankets before increasing the thermostat during the winter. Heating and cooling are often very expensive - you can drastically cut expenses for as long as possible this way before you have no choice but to turn the heat on.
Air dry clothes on a clothing line instead of using the dryer.
Don’t leave oven doors open when food is cooking inside, and don’t leave the fridge door open. Your appliances have to work a little harder to get back to the right temperature.
Set lights and thermostats on timers in case you forget to turn them off.
Reduce the temperature settings on your thermostat. A few degrees warmer or cooler will still be comfortable enough for you to live in.
After the dishwasher cycle is completed, open the dishwasher to let the dishes air-dry instead of using the built-in heat dry function.
Close doors/windows to keep the heat and cool inside. This will help keep heating and cooling costs in check.
Use a door snake to seal the gap between the door and the floor where hot/cold air can escape. This keeps heat inside in winter and cold air inside in summer.
Put up heat-insulated curtains to help keep heat inside your home during the winter.
Rely on natural light or candles, especially during daylight hours.
When possible, only run the dishwasher and washing machine with cold water.
Run the laundry or dishwasher at night for off-peak utility rates.
Repair leaky faucets to save water. If it's not in your budget to have them repaired, catch the dripping water in a cup or small pot and use it somewhere around your home.
Skip the dishwasher pre-rinse. For baked-on stains, simply soak your dishes overnight in the sink - fill the dishes with water, not the sink.
Use your dishwasher and washing machine only when you have a full load.
Turn off the tap when brushing your teeth, shampooing, shaving etc.
Time yourself and take shorter showers or opt for a bath instead.
Streaming & Internet
Eliminate excess streaming and cable services. There’s also plenty of free entertainment on YouTube!
Eliminate your landline service and only use your mobile/cell service.
Make sure your mobile/cell phone has enough data to avoid excess usage charges.
Swap cable and Foxtel for cheaper alternatives like Netflix, Disney+, Apple TV+ or Amazon Prime. Research what's offered on each platform and try out any free trial periods to see which platform works best for you.
Lower the speed or capacity of your home internet.
Reuse, recycle or upcycle jars, bottles and other reusable packaging. You can turn them into storage jars or small pots for growing your own herbs.
Ditch paper towels and switch to reusable cleaning cloths that can be thrown in the washing machine.
Invest in quality laundry detergents to help your clothes last longer.
Reduce or eliminate child activities. Opt for free options from the local library or play dates in your neighbourhood.
Save money on dry cleaning by only dry cleaning investment pieces. Try to avoid buying clothing that will require dry cleaning altogether. It's pretty expensive so this can drastically cut your household expenses.
Appliances & household items
Where possible, switch to energy-efficient appliances. It’ll be an investment up front but will save you money in running costs in the long term.
If possible, also opt for water-efficient low flow taps and showerheads.
Install dual flush buttons in all the toilets in your home. You might be able to just pick up the buttons from the local hardware store and install them yourself without an expensive plumber.
DIY everything you can. Convenience is a great thing, but it's also expensive. Watch tutorials on YouTube to learn how to DIY things around your house like small repairs and projects.
Declutter your entire home. You'll likely find a few things you can repurpose which will save a bit of money. You might also find things you forgot you had which will help avoid situations where you buy things twice.
Have a garage/yard sale or sell unused and unwanted things on Facebook marketplace.
Don't upgrade to the latest tech - buy pre-owned items on eBay instead.
If you're in need of new furniture, try buying pre-owned first. Look on eBay or Facebook marketplace and try asking around your network for any pieces people are trying to get rid of.
Cut transportation costs
Check online or using local fuel price check apps for the cheapest fuel in your local area. Fuel prices are often lowest in the middle of the week. Plan your week around filling up on the cheapest day.
Learn basic car maintenance from watching YouTube videos, or if you know someone who’s good with cars, ask them to work on your car and cook them dinner. You can DIY maintenance activities like oil changes, wiper changes, bulb changes etc.
Use your car as little as possible. Try a carpooling roster with friends, co-workers or neighbours.
Keep your vehicle tyres properly inflated. Air is free, so it's just a matter of taking the time to do it. Properly inflated tyres will help increase your mileage meaning you'll save money on fuel.
Instead of driving, try walking or riding a bike to your destination. You may need to save up a little bit of money for a decent bike and safety gear first, but try shopping pre-owned if you can.
Use public transport where you can.
Sell the second car. When you have only one, you'll be forced to make do with it.
Cut insurance bills
Call your insurance providers and ask for a better rate, or shop around with other insurance providers. Try bundling home and car insurance together to see if it will be cheaper than buying it separately.
You can usually lower your premiums by increasing your excess/deductible.
Downgrade your coverage so that you're only paying for what you need.
Pay annually if you can. Insurance providers often give you a small discount for paying up front rather than in monthly installments.
Cut monthly debt payments
If you can afford to pay down some debt over and above your minimum debt payments, then it's a good way to lower your monthly costs. By paying down debt, you'll be reducing the amount of interest you owe on your remaining debt in the future.
Research your options to refinance your debts for cheaper interest rates.
Look into a credit card balance transfer for 0% interest for a certain time period. The key here is to try to pay off your debt before the 0% interest period runs out.
Consolidate your debts into one debt with a single rate through a personal loan or debt consolidation services.
Request a rate reduction or debt relief from your creditors. If you don't ask, the answer is always 'no'.
Cut housing expenses
Get a roommate or housemate you trust to cut costs in half. This can drastically cut your expenses but be selective in your choice of housemate and set some house rules so that they don't freeload off you.
Move into a smaller home. You'll likely be paying less for the lower amount of space and it will be cheaper for your utilities and insurance.
Move to another area that has a lower cost of living.
Live with your family temporarily.
If you have a spare room in your home that isn't really being used, consider renting it out.
Try alternative housing options e.g. tiny house, trailer etc.
Cut entertainment costs & everyday expenses
Opt for date nights at home! You can play couples’ games, cook a meal together or have a movie night on the couch.
Borrow books from the library or opt for ebooks instead. Both of these options are much cheaper alternatives to buying physical books.
Host a pot-luck style event instead of going out where everyone brings a dish to contribute to the meal. Eating out is a large part of the budget so you can drastically cut expenses by opting for at-home fun.
Trade babysitting services with friends, family or neighbours you trust.
Go to the movies or certain restaurants on the cheap days. This is usually in the middle of the week when business is slow for these establishments.
Cancel newspaper/magazine memberships and subscriptions. You can probably find almost everything you need online for free.
Cut health, beauty & grooming costs
Cancel your gym membership and look for second-hand gym equipment to create a gym at home.
Workout outside for free, or at home using cheaper online workout programs and apps. There's a huge difference in price between an app and a gym membership which means you can drastically cut expenses with very little effort.
Give yourself a DIY manicure and pedicure at home. Invest in a long lasting top-coat, so that your nails last longer.
Colour your hair or add highlights at home. Ask a friend to help you and then return the favour.
Research some restorative at-home hair treatments to keep your hair healthier for longer, and reduce the frequency of “needing a trim”.
Use cheaper makeup brands for your daily makeup and only opt for the more expensive brands for special occasions. Or don’t wear makeup at all, if you can.
Apply skincare products directly to your skin instead of rubbing it in your hands first - you’re only wasting the product.
Review your skincare routine and mix and match the brands that you use. You don’t need to use high end or expensive products for everything. And you don’t need to be restricted to only one brand or product range.
DIY your leg waxes at home and opt for false lashes instead of salon lash extensions. Do your research first, to make sure you’re actually choosing cheaper alternatives.
Ask your doctor and pharmacist for generic brands of prescription medicines.
Make every effort to quit smoking and reduce alcohol intake. You can save a small fortune by cutting these expenses from your budget. This isn't easy by any means but you'll drastically cut your ongoing expenses.
Do a clothing swap with friends, family and neighbours instead of buying new clothes.
Other things to consider when trying to drastically cut your expenses
Be prepared to make sacrifices & tough decisions
An important thing to note is that if you really want to drastically cut your expenses, then you need to be prepared to make some tough decisions. To really cut your expenses down to the bone, you're going to need to give up certain things in your life. There is nothing in this life that comes without sacrifice, and being able to save as much money as possible is one of those things.
Setting priorities & goals: what to cut & why
Drastically cutting your expenses isn't going to be easy. Therefore, to make it easier on yourself, you need to make your cost-cutting mission worth it. You're going to need to make some tough choices in order to cut your expenses. There will be times when you want to give up or things you don't want to sacrifice. In order to keep yourself on track with your cost-cutting, you need to make all the sacrifice worth it.
Set some priorities and goals before you start drastically cutting expenses. Your priorities will help you determine which costs to sacrifice and which ones to keep in your budget.
For example, if it's more important to you to get your daily coffee than it is to go out for drinks after work, then it's easier to know which cost to cut.
Furthermore, it's a great idea to set yourself some goals as well. Why are you drastically cutting your expenses? Are you trying to build an emergency fund? Perhaps you're trying to become debt free? Or maybe you're saving up for a big purchase. Knowing how much you need to cut and the purpose of all your cost-cutting will give you some direction. It makes it easier to make tough choices when you know what you're making the sacrifice for.
How to control bad spending habits
Drastically cutting your expenses isn't a particularly easy thing to do, especially if you're a bit of a spender. It's easy for spending to get out of control. This is especially true for me when I'm having a bad day. I'm an emotional spender. And those spending habits aren't easy to break.
Check out this blog post for some great ways to help you control your spending.
A spending freeze is also a fantastic way to cut expense quickly, but they're not easy. Challenge yourself not to spend any money for a month except on the 5 essentials:
Spend with cash only
I don't recommend using cash-only as a long term solution for budgeting. However, when you're trying to drastically cut your expenses, it can be one of the easiest ways to make a big difference.
When you're spending with cash, you're more aware of how much money you're actually spending. It's harder to hand someone actual cash than a piece of plastic.
Many studies have shown that people tend to spend much less when they pay with cash than with a credit or debit card.
Cashback apps and tools
A great way to save a little extra money on things you're definitely going to buy is to use cash back apps and tools. These are great for groceries and household items that you can't cut out completely. Apps and browser extensions like Rakuten (formerly Ebates), Honey and Ibotta are great ways to get additional discounts or earn cash back on your purchases.
What should you do with your savings?
When you drastically cut your expenses, you'll probably be saving more money than you ever have before. It's important to have a plan for all that extra money before you get started. This will help you avoid spending all your extra savings on something else.
What you do with your extra savings will depend on your priorities. Are you trying to pay down debt or build up an emergency fund? Maybe you're planning a vacation or saving up for a house deposit.
You should always have a separate savings account for your emergency fund. It should be easily accessible if you need it, but not easy to spend in your day to day life. For other savings goals, consider opening multiple fee-free bank accounts where you can transfer your savings every week. If you aren't able to open additional bank accounts, keep a log of how much you're saving.
If you're trying to pay down debt, make a plan as part of your budget to make additional debt repayments.
Earning extra income
This post is all about saving money or paying off debt by drastically cutting your expenses. But the truth is that you can only cut your expenses so far. No matter how many expenses you cut, you'll likely still have costs for housing, food, utilities, medical and transport.
When you've cut all costs you possibly can but you still can't save enough, you only have one other option. You'll have to increase your income.
The easiest and quickest way to do this is to sell unused or unwanted items around your home. Below are some other ways to increase your income, but they're not as easy:
- earn a pay increase or promotion at your current job
- look for another job which has higher pay or perhaps lower transport costs
- make things you can sell online at a profit
- learn a new skill that's easily transferable to other jobs
- take on a second job or part-time work
- get creative with ways to make money online, for example, by freelancing
Drastically cutting your expenses is not a particularly easy thing to do. It requires a certain amount of willpower and sacrifice, but it's the quickest way to save money in your existing budget. There are many changes you can make to your lifestyle, both big and small, that help you cut costs and save money. More money in your budget means more money that can be dedicated to paying off debt or boosting your savings.