How to Save Money by Living Below Your Means

Sharing is caring!

How much money do you manage to add to your savings every month?

Well, if you’re like most of us, it’s not as much as you’d probably like. And there are probably when you aren’t able to add anything to your savings account at all.

It’s not that you don’t know how important it is to build up a nest egg. Of course you do. And you’d love to be able to increase the amount of money you’re able to add to your savings each year. But, given your current monthly expenses, you don’t know where this “extra money” is supposed to come from.

Luckily, there’s a simple way to save more every month and reach your savings goals faster. And that’s by living below your means. 

The Basics of Living Below Your Means

The nutshell definition of “living below your means” is that you spend less than you can afford to spend. And the money you don’t spend gets added to your nest egg.

Say a household brings in about $45,000 a year in income. But that family tries to live as if they only had an income of $40,000 a year. They ignore the fact that the rest of that money exists, instead adding it to their savings. That’s a pretty basic, and somewhat simplified, example of what “living below your means” is all about.

Some people hear the words “living below your means” and imagine stripping down to the bare bones. Only spending money on the absolute essentials and giving up just about everything that can make their lives more comfortable, fun or enjoyable.

Living by a strict budget where you only spend money on the bare minimum is definitely a way to save money. But you don’t have to go that route in order to reach your savings goals. Instead, all you really need to do is eliminate expenses that are truly unnecessary, and find ways to spend less on the things you need…or just want.

There are ways to live comfortably while also living below your means. Here are a few of them.

Eliminate Unnecessary Expenses

Are you paying for things you don’t actually use?

If so, you’re not alone. This is actually more common than you might think. And if you could eliminate those unnecessary expenses, that’s “extra” money you could be adding to your nest egg.

Here are some things you might be paying for and not fully using.


Do you subscribe to any magazines? If so, do you actually read each and every copy you receive? If the answer to that question is “no,” then you aren’t getting your money’s worth.

Not only are you paying for something you don’t really use, but those unread magazines can easily turn into clutter. After all, you paid for them, and you don’t want to throw them away until you’ve read them, which you intend to do…some day.

So step one is cancelling subscriptions to those magazines you aren’t reading.


Maybe you like the tactile experience of reading an actual, physical newspaper, which is why you like having one delivered to your house every morning. But if you aren’t actually reading the paper every day, that’s money down the drain.

You don’t have to completely give up the newspaper. Instead, you can opt to only receive the weekend editions. After all, weekends are probably when you actually have the time to read the newspaper. 

Cable Television

Some people advocate giving up cable television altogether in order to save money. You don’t have to go that far, but there’s a chance you’re paying for a more expensive cable package than your family actually needs.

Having a thousand channels to choose from does sound impressive. But if no one in your family is actually watching most of them that money is going to waste.

Getting a less expensive cable package is an easy way to save money every month.

Consider all of the things you pay for on a monthly basis. Are some of those recurring payments for things you don’t use, or don’t use fully? How many of those expenses can you either reduce or eliminate?

Save at the Grocery Store

Food is probably one of your biggest expenses. Feeding just one person a month can cost a pretty penny. And for every person in your household, that cost is multiplied.

Fortunately, there are simple things you can do to save on your food bill.

Buy in bulk.

Buying a larger version of a product usually costs less per pound or ounce than buying a smaller one. For example, a 10 pound bag of sugar costs less per pound than a 4 or 5 pound bag.

If you use a lot of a specific food item, like flour, canned vegetables, beef and poultry, or even snacks, you’ll save money by buying a bigger version.

But don’t get carried away. Buying a 20 pound bag of rice might seem like a great deal per pound compared to a smaller bag. But if your family doesn’t eat a lot of rice, and you end up throwing 15 pounds of that rice away, you won’t really save any money in the long run. 

Buy generic or store brands.

Whether you’re buying luncheon meat, corn meal or frozen dinners, the store brand or generic brand will usually cost less than the name brand.

With some things (like sugar, canned corn, or hard candy) you won’t be able to tell the difference between a store brand and a name brand. 

It’s true that a store brand version of your favorite cola, for example, might not taste exactly like your favorite, name brand cola. But your family might like the store brand despite the different taste. And, as a bonus, you’ll be able to buy cola for 25% to 50% less.

Use coupons to save on name brands.

That store brand cola you tried was okay. But you just can’t give up your favorite, name brand cola.

Well, you can still save on that name brand soda. You just need a coupon. Just use coupons, and you can get that soda for a reduced price.

You can find coupons in mailers, magazines, or the Sunday newspaper. You can even find coupons in the grocery store itself, taped directly to the product. These coupons can be used immediately.

If you want a coupon for a specific product, just look online. You can find digital coupons for many of your favorite brands.

Check out weekly sales at local grocery stores.

Most grocery stores put a selection of products on sale every week. These sales are advertised in circulars that you’ll find in your mailbox, in the newspaper, and in the store itself. And many grocery stores, especially those chain stores, make digital version of their circulars available online.

You can save a lot of money by buying products you commonly use when they’re on sale.

Buy Used

Thrift Store

Some people are hesitant about buying used goods. Maybe they think anything they buy second hand will be outdated, or in need of repairs. But you can actually find used items that are high quality, in great condition, and cost a fraction of what you would spend for the same item brand new.

Even if you need to make some repairs to an item, like a piece of furniture, what you pay versus what the item ends up being worth is often worth a little elbow grease.

Here are a few ways to find used merchandise.

Shop for Used Goods at Thrift Stores

Typically, a thrift store sells used goods that have been donated to them, often by people like you. Many thrift stores are non-profits, meaning the money the store makes is used to support a worthy cause. For many, that’s one of the most gratifying things about shopping at thrift store.

You can find anything from books, to furniture, to video games in a thrift store. And they are especially good if you’re shopping for clothes, shoes, and outerwear.

At a thrift store, you can buy several outfits for what you could spend on a single pair of shoes at a department store. Just think about how much you spend on new clothes for your family every year. Now imagine how much you’d save if you bought those clothes at a thrift store.

There are probably thrift stores in your area that you didn’t know existed. One way to find them is by using a search engine like Google. Just type in the words “thrift store” (in quotes) along with the name of your city or county, and you’ll get a long list of thrift stores to check out.

And don’t forget to check online. Some thrift stores and thrift store chains, like Goodwill, have websites where you can peruse and even purchase some of their merchandise.

Shop for Used Goods at Consignment Shops

Consignment shops are another place where you can buy used goods. But while consignment shops have a lot in common with thrift stores, they are not the same.

A consignment shop is a business where individuals can take their goods to be sold. For example, say you have a beautiful dresser that you just don’t have room for anymore. Instead of trying to sell it yourself, you could take it to a consignment shop and let them sell it for you. Once the dresser has been sold, the consignment shop will take a cut of the profits, and you’ll get the rest.

Consignment shops can be a great place to buy used furniture. You can sometimes find great furniture at a thrift store, but they’ll usually take some work. You could find a dresser with a lot of potential, but it might need to be painted or refinished. And you might have to replace a drawer, and add new hardware.

Used furniture you find at a consignment shop will already have been repaired and refurbished, mostly to make those items more appealing to potential buyers.

Buying used goods from a consignment shop can be more expensive than buying from a thrift store. But it will still be a fraction of what it would cost to buy those items brand new.

Shop for Refurbished Electronics Online

Buying electronics brand new can take a huge chunk out of your budget. In order to save money on this type of merchandise, there are a few things you can do.

  • You can buy a low quality brand that might work great at first but probably won’t last very long.
  • You can buy a quality brand, but opt for a model that doesn’t have all of the features you want.
  • You can buy refurbished products that are like new, high quality, and come with all the features you could ask for.

Refurbished electronics cost a fraction of what the same products would cost brand new. Technically they are used goods. But it would be more accurate to say they are almost new.

Say someone buys a laptop. They take it home, fire it up, and use it to surf the web for a few hours. The laptop works great. But, they next day, they decide to return it. Not because there’s something wrong with the laptop, but because they suddenly decide they want a different model. Or maybe they get hit with buyer’s remorse and decide they really can’t afford a new laptop right now.

Once the laptop has been returned, the manufacturer can’t turn around and sell it as “brand new,” even though it had only been used for a few hours and is still in “like new” condition. Instead, they’ll “freshen up” the laptop, changing the battery and replacing the power cords. Then they’ll sell the laptop as refurbished, at a fraction of the retail price.

You can buy just about any kind of electronics refurbished, including computer, printers, TVs, cell phones, and MP3 players. And one of the easiest ways to find refurbished products is to look online for reputable sellers of refurbished good.

Finding ways to save money in every area of your life is one of the quickest ways to reach your savings goals. And the money saving tips listed above are just a start. Once you start actively looking for ways to spend less every month, you’ll be surprised by how fast your savings will grow.