Painless Ways to Live Below Your Means

Spending less than you earn is quite simply how everyday Americans get rich.

Yet for a lot of people, there is nothing simple about it.  Many find it nearly impossible to live within their means.  So what should you do? Here are 9 ideas:

  1. Start by knowing where your money goes. Track your spending with one of the plethora of tools that are available today:, Personal Capital, online bank account summaries, or an old-fashioned spreadsheet.  It’s like dieting. If you write down everything you eat, you will eat less.

  2. Crack an axe at reducing re-occurring monthly services like cable, internet, phone, newspapers, and other online memberships by putting on your chief negotiator hat. After doing a little research, dial them up and have the following call, “Mrs. CS agent, I have been a loyal customer for XX years; and I am in a financial bind and need to drop (or replace) your service.  I thought before I did that I should call you and see if you can help me reduce my costs.”  Be willing to drop their service for 3-6 months and then see what discount they will offer to lure you back.  Want to maximize your negotiation, have this call with someone else on the phone with you like your spouse or financial advisor.

  3. Reduce the frequency of services like house-keeping and gardening.  Perhaps investing in lower maintenance plants or indulging in a good vacuum cleaner and hiring your kids to pitch in can lead you to drop these services altogether.

  4. Hunt for the lowest prices, especially with big ticket item purchases; and the biggest store in the world is right at your fingertips.  It’s called Amazon for a reason.  You will be amazed at what you can find on Amazon and Ebay these days, and you will also save gas money and time.

  5. Change your life for the better.  Do you need exercise? Consider riding your bike work. Do you need time? Reduce eating out at lunch.  Are you all about saving the planet? Find a carpool or rideshare near you at

  6. Slash your insurance costs.  A good place to start is the internet.  Try There has been a feeding frenzy for cheap term life insurance, which is making rates incredibly competitive.  Rebid auto, home, and umbrella policies, and search financial bloggers like “MMM Recommends” for best places to start.  Also look into saving money by boosting deductibles on your auto and home insurance.  Consider whether collision insurance makes sense on your vehicle with the help of a good agent.  

  7. Take full advantage of health savings accounts and retirement savings accounts.  With these employer-sponsored plans, you get to save and spend out of pre-tax dollars.  In many cases, an employer match is also offered, which is the easiest way to get free money. 

  8. Free entertainment abounds. Whether it is the beach or our beautiful libraries, keep a list of favorite “free things to do” and focus your time on those activities.  Free stuff can bring more joy, peace of mind, and less hassle.

  9. The best way to save on expenses is to move to a place where the cost of living is cheaper.  It may be difficult if you are working now, but it certainly should be a consideration as you move into retirement. Sometimes a lower cost of living is less than 15 minutes away.  And, if you really want to hit the jackpot of lower living costs– pay off your mortgage. One extra payment a year can reduce a 30 year mortgage by 5 years or more. 

More often than not, wealth is the result of smart spending, a lifestyle of hard work, discipline and good planning. In the words of Thomas Stanley, author of the Millionaire Next Door: “Many people who live in expensive homes and drive luxury cars do not actually have much wealth…Many people who have a great deal of wealth do not even live in upscale neighborhoods.”
Thomas J. Stanley, The Millionaire Next Door: The Surprising Secrets of America's Wealthy