Lifestyle Hacks That Impact Savings Rate

Everyone in the FIRE community knows that the key to reaching your financial goals is to have an extremely high savings rate. My guess is that most of us who are still working towards financial independence are making somewhere between $50-150k per year (give or take) so it takes some planning and some life style changes to reach our financial goals as quickly as possible.

Below I’m going to point out what lifestyle hacks my family and I have implemented that have helped lead to what I consider a pretty solid savings rate. These hacks have allowed a family of 4 to save $70k and they are helping us to currently be on pace to save $75k this year.

Lifestyle Hack 1: Food!

Seriously sit down and take a look at your credit card statement or bank account and add up how much you spend on eating out in a month. If this is something you haven’t thought of before, I bet the number is pretty high. Let’s take my family for example. We are a family of 4 and a typical meal out for us would be about $25-$40. That’s just for 1 meal! I could literally buy a whole week worth of groceries for this amount and we could eat like kings (and be much healthier).

It seems like eating out has become a daily occurrence for most people. I remember when I was a kid going out to eat was a pretty big deal. It was usually on Sundays after church, or maybe on Friday nights, but certainly didn’t happen as much as it seems to now.

So if you want to add to your savings rate, while also positively impacting your health then instead of going out to eat, sit down for 20-30 minutes and plan out healthy recipes for your family to have over the next week. If you want to save even more money, make some (or all) of these recipes plant based, meaning based around potatoes, rice, beans, fresh vegetables, etc.. You’ll feel better and before you know it you will have more magic beans sitting in your bank account each month.

Lifestyle Hack 2: Transportation

I’m a big proponent of biking or walking to places rather than driving. That said, the reality is that I live in Houston and it happens to be the commuter capital of the world so I still drive a good bit, but I am happy to point out that my family of 4 made the choice to go to a 1 car family a little over 3 years ago and it has helped our bottom line (and my health tremendously).

How has it helped our bottom line? Well for starters our insurance went down by about 50% by going from a 2 to a 1 car family. Obviously our gas bill has also decreased by about $40 (or 2 tanks worth of gas per month). Maintenance costs are way down and we only have to pay for 1 state inspection/registration each year now.

How has it helped my health? I take the bus to work every day, which leaves from a park and ride that is about 6.5 miles away from my house. Since we went to being a 1 car family I made the choice to bike to and from the park and ride instead of driving. So just to get to and from work I’m getting in about 13 heart pumping miles of cardio. I don’t need a gym membership because my workout is my commute, which actually gives me more time to spend with my kids when I get home. I really can’t recommend riding a bike enough. In case you need more motivation for it, give a read to this post from MMM, Get rich with bikes.

All in all going from a 2 car family to a 1 car family has been one of the best financial decisions we have ever made.

Lifestyle Hack 3: Cut the Cord!

The next lifestyle hack that has had a very positive impact on our lives is when we decided to cut the cord. I admit this hack was probably one of the more difficult ones to implement. It probably took me about 2 weeks before I even brought it up to my wife. Lucky for me she is open to most of the “crazy” ideas that pop up in my head so we cut the cord about 4 years ago and have literally not once regretted it.

Now, we aren’t the type of people who don’t enjoy watching TV or movies so instead of paying for cable we simply pay $11 per month for Netflix. For the amount of content we receive from this, we find it to be well worth the price (and would probably pay a little more if we had to). You don’t have to pay for Netflix though, because the library is also a GREAT option when it comes to checking out movies or TV shows. Or if you are just interested in getting local channels, then all you need to do is buy a Mohu Leaf for $30 and you will have crystal clear TV for free (not an affiliate link).

With so many people cutting the cord the options are growing more and more each day. So don’t be the person that is still paying $100+ per month for cable or satellite, it’s just not worth it.

What I find most interesting about implementing these life style hacks is that they work similar to the way compound interest works, in that one will typically lead to another and it will just continue to snowball. Also, as you get rid of things be it cars, cable, or whatever you gain more control over your life and that’s a powerful thing.

So readers, what lifestyle hacks do you and your family currently implement?

8 thoughts on “Lifestyle Hacks That Impact Savings Rate

  1. My wife currently buys a ton of clothes from thrift stores for my son. He is growing like a weed and he doesn’t care what he wears. So she finds gently used clothing and puts him in it. I’m sure we save hundreds of dollars a year this way.

    1. I never liked the idea of buying used clothing, but, as you say, it can really save you a lot of money. Right now, one of our biggest money drains is our 3 year old’s closet, since she’s also growing fast and still needing a lot of clothes.

      We don’t eat out, since most restaurant meals are crappy and expensive, so I’d rather ‘waste’ a bit of time cooking something delicious instead.

  2. For food, I don’t even want to try to add up how much money I spend/waste. As a single guy, I eat out EVERY DAY! It’s sad. I don’t cook. I could cook to save my life, but otherwise, I don’t cook. I’m trying to give up Starbucks too. I’m not even invested in that stock. Anyway, don’t get me started. It’s ridiculous.

    For transportation, I don’t have a car payment (or a car) at the moment. I’m not planning on getting another car for another year. So, I should be saving in that department a little. I might rent a car here or there and I do maintain my insurance, but I don’t have a car payment.

    Regarding cutting the cord, I gave up Directv last year. I only had it because my roommates wanted it, but we were able to get out of it. I have both Hulu and Netflix. I should watch them more often but I don’t. However, I keep Netflix because other family members use my account, and I like Hulu because it has some tv shows I like.

    I think readers should definitely take a look at areas in their life where they can cut back and save so that they can better achieve their financial goals.

    Good article.

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