Saving money can be simple. It’s all about the little changes - daily, weekly, or monthly. Change your mindset, your habits, the way you spend your money and you will see an increase in your savings.

I have adopted many of these rules in the last two years and I have managed to reduce my expenses by 30%. A huge amount of money. And still, I don’t feel as though I am lacking something. I lead the same life, only I finally have my expenses under control.

This blog will be focused on tips how to save money on long-term and regular monthly expenses. In the next couple of days we will also bring you tips on how to save on daily and weekly basis.

1. Pay yourself first

When you get your salary, always pay yourself first – at least 10%. If that seems too much, start lower. The less money you have at your disposal in a given month, the less you spend. 

For example, if you get your salary on the 15th day of the month, set a standing order on the 16h day of the month to your savings account. This way you will resist the temptation to skip your monthly savings payment.

2. Reassess your debts

Do you have a mortgage with an interest rate over 1%? If there is a thing you shouldn’t postpone, it’s the monthly mortgage payment. It’s probably one of your biggest monthly expenses and an opportunity to save a lot of money. Probably the biggest one out of those I am going to mention. 

Nowadays you can get funding from 0.4% p.a.. The average rates of new loans are at about 1.1% while the older loans with 1 to 5 year fixation are at 2.75%. Refinancing can save you up to 1.65% p.a., which means 1650 Euros per year when considering a 100.000 loan!

Some banks will even gladly pay a 1 % fine for early mortgage repayment in other bank outside the fixation period. Not everyone is eligible for this kind of interest rate but you should at least try.

The same applies to all your other debts. Try to consolidate them into a single one with significantly lower interest rate. Any competent financial agent should be able to help you with this.

3. Re-evaluate all your other financial products

Are you sure that you are not getting ripped off on your car/real estate insurance? When was the last time you have re-evaluated the cost of these financial products?

Cancel your unit-linked life insurance and replace it with term life insurance. Building savings account is also a bad deal. 

If you are to save money, you need to make sure that all your financial products are working for you for a reasonable price.

4. Save on the transport costs

Your car is probably your biggest pointless expense. 

If you don’t have to, don’t buy new cars. It will lose more than half of its value in the first four years. If you need a car, buy a used one. If there are two cars in your family, reconsider whether you need both and sell one of them.

Dust off your bike or consider commuting to work on foot or use public transport. This year, I have commuted to work twice as much by bike than by car and I think it’s great. Even taking a taxi can be cheaper than using a car.

Car is probably the second biggest expense and also an opportunity to save more money. So, please, take this point seriously.

5. Do you really need to spend your vacation near the sea this year?

Many Slovaks consider spending their vacation near the sea a must. Isn’t it only a habit and laziness? Shouldn’t you try something new? Each of us has their own dream „sea“, a destination where they would like to spend their vacation.

Two years ago I asked my kids which holidays they had liked the best that year. I had expected them to choose the great holiday we had spent near the sea or skiing in the austrian Alps. I was far from the truth. A three-day camping in Karpaty Mountains, 30 km from Bratislava was their TOP holiday.

This year we have been camping 5 times and we can’t get enough of it. Camps, bikes, backpacks and the forest. Thousands of Euros saved and we can still spend our holiday near the sea next year.

Don’t feel like camping? Ask your uncle/colleague whether you could go to their cabin with them. Be creative. It’s your money that’s in stake.

Even the trip itself can be fun. In the last 5 years we would always leave the car at home and go by train at least once a year. The kids are already asking when are we going on the next „train trip“. Besides the fact that I save a lot of money, I consider it to be a form of education for my children – so they don’t take the car for granted.

6. Bank fees

Do you pay a fee for maintaining the account, transactions, SMS or any other fees in your bank? Do the fees on your partner’s bank account keep mounting on? Change that immediately.

With every bank you have the possibility to avoid fees. If you can’t adjust your payments to comply with their conditions, change your bank. Immediately. I haven’t paid any bank fee for a long time and this way, together with my wife, we have saved tens of Euros per month.

7. Phone, Internet and TV

You have been paying all of these fees for years and years and you often take them for granted. Over time, however, new deals become available which are often cheaper than the previous ones. For example, you can get more cellular data for the same price. Many companies also offer combined products 3 in 1 which can help you save tens of Euros.

I set up my products from scratch last year. Surprisingly, now I enjoy much better services and I save 20 Euros each month. All it took was two evenings and running some errands with the providers. If you want to pay even less for cable, simply cut your household off. The digital option offers the basic channels for free.

8. Cancel your subscriptions and memberships

Netflix, HBO GO, Spotify, new app features and many other subscriptions. You used the service when you bought it, however, you might not be using it anymore. The subscriptions is, however, due each month. If you need to save money, cancel all your subscriptions immediately.

9. Borrow tools and appliances

Have you ever been missing 2 eggs for your cake recipe, so you just ran down to your neighbor’s and borrowed them? Apply the same principle when it comes to your expenses.

Are you planning on constructing a DIY wooden porch and you need a cutter? Borrow it from a friend, don’t buy a new one. If a friend or neighbor can’t lend it to you, borrow it somewhere else. Nowadays, we have workshops that you can rent and use for whatever you need. You don’t need to buy almost any tools.

10. Organize your parties at home

Birthday parties, baby showers or Friday nights with your friends – start organizing them at home instead of bars and restaurants. Expensive alcohol can be replaced with the same brand from a supermarket – for a fraction of the price.

11. Be reasonable when doing sports

Did you make a New Year’s resolution to start doing sports? Don’t immediately buy the most expensive bike for 3000 Euros. In order to start, a bike for a couple of hundred Euros will suffice, as well as a basic jogging suit. If you get on your bike 5 times a year, it’s not necessary to invest so much money to so little avail.

It’s different when the sport is your hobby or you spend a lot of time doing it. The same principle applies to all other leisure activities.

12. Set up a monthly budget

This is a piece of cake. If you want to save money on a monthly basis and reduce your expenses, you need to create a monthly budget and allocate each and every Euro of your salary to a specific expense – including the amount you wish to save each month.

Already have a budget? Great! The next month, decrease each allocated amount by 5 Euros. If you have been spending a 100 Euros on something, decrease it to 95. If you can’t decrease the amount allocated to a certain item, pick another one and decrease it by 10 Euros. You will barely notice the difference, however, your savings will keep piling on and the amount will be significantly higher.

And keep in mind, if you want to further your financial education and improve your financial situation, download our mobile app „Finax: Finance and investing“ today and get access to all our blogs, videos, and podcasts all in one place.