Thanks for signing up!
Access your favorite topics in a personalized feed while you're on the go.
13 tips to save up to $1,000 in 30 days or less
Affiliate links for the products on this page are from partners that compensate us and terms apply to offers listed (see our advertiser disclosure with our list of partners for more details). However, our opinions are our own. See how we rate products and services to help you make smart decisions with your money.
Tired of reading the standard frugality tips, author of "I Will Teach You To Be Rich" Ramit Sethi decided to launch a challenge to help people save $1,000 in a week.
Advertisement
He accompanied the challenge with a wealth of tips on his blog — from how to negotiate your car insurance to saving money while eating out — to help people achieve their savings goals.
We sifted through Sethi's advice and chose 13 of our favorites.
If you aren't up for an intense week, you can use these tips over the course of a month to similar effect.
"Many of us (including me) pick a cell phone plan, then never check to see if it's the right one for us based on our usage," writes Sethi. "Because the average cell phone bill is about $50, that's $600 per year of money you can optimize."
When buying a new cell phone, Sethi likes to pay a little bit more upfront by choosing the unlimited data and text messaging plan. He then sets a three-month check-in on his calendar, and analyzes his spending patterns after a few months to see where he can cut back.
You can use this method for any usage-based services, he says.
Estimated savings: $20 to $600.
Choose one day each week and challenge yourself to not spend a single dollar.
"Technically, even if you don't open your wallet, you're still spending money on things like rent, car insurance, and subscriptions," writes Sethi. "You just didn't count them. But that's even more of a reason to create a 'no spending' day on the money in your wallet: because you can actively control it."
The key to this tip is putting it in your calendar so it becomes a consistent system.
Estimated savings: $5 to $75.
"It's very simple," writes Sethi. "New lawn mower — wait. New TV — wait. New dishwasher — wait. You can set a calendar reminder to check on it in 30 days. A couple of things will probably happen when you do this: First, prices will probably drop. Second, chances are you'll realize you didn't really need it."
Estimated savings: $50 to $3,000.
Take out a limited amount of money from your checking account that will be enough to last for a few weeks, and then set aside the credit card. This forces you to be a conscious spender.
"Rather than blindly using your credit card and deferring whether it's worth it or not until your bill comes — by that time, it's too late — using cash forces you to make that decision when you pay," writes Sethi. "You withdraw a limited amount and watch it dwindle. It's very primal: Since we're more motivated by loss than by gain, each dollar you physically spend will cause you pain: the good kind of pain."
Estimated savings: $50 to $300.
"You have to prioritize because you can't have the best of everything," explains Sethi. "Buy brand-name for the stuff you care about, and cut costs mercilessly on commodities you don't care about by buying generic."
Areas you may be able to save money on include: toiletries, food, certain clothes, and pet supplies. What is important to you? And what are you willing to sacrifice? Establish what you want to prioritize and what you can de-prioritize.
Estimated savings: $50 to $500.
This technique takes advantage of psychology to cut our costs.
"Cancel all the discretionary subscriptions you can: your magazines, TiVo, cable — even your gym," Sethi explains in "I Will Teach You To Be Rich." "Then, buy what you need à la carte. Instead of paying for a ton of channels you never watch on cable, buy only the episodes you watch for $1.99 each off iTunes. Buy a day pass for the gym each time you go."
It works for three reasons, Sethi writes: You're likely overpaying already, you're forced to be conscious about your spending, and you value what you pay for.
Estimated savings: $10 to $100.
Even if you only do this one or two times a month, this is one of the most cost-effective decisions you can make, says Sethi.
After factoring in all of the moving parts of going out to socialize — gas, drinks, food, tips, tax, and miscellaneous things such as valet or lending money — one night can easily add up to $50-plus.
Try hosting a potluck, dinner party, or simply ordering pizza a few times a month instead of hanging out with friends at a restaurant or bar. "By staying home, you'll avoid the ravages of tips, taxes, cabs, and marked-up drinks," writes Sethi.
Estimated savings: $50 to $200.
If you're already doing a good job of saving, the next step is to make money.
This tip serves two main purposes, says Sethi: "To symbolize to yourself that you can sacrifice by selling something, and to symbolize that you can make more money than your standard income. Once you do that, there are many other ways to generate income."
It doesn't matter what, or how many things, you sell. The point is not even to make much money (that's an added bonus). "The point is the symbolism of cleaning your life and generating even a small amount more money than you normally earn," he writes.
Estimated savings: $40 to $100.
By establishing a rule that you can only buy to replace something you already have, you're creating what Sethi calls an "active barrier."
"Before buying anything, think 'how many of those do I need?' and, 'how many do I already have?' Then think again if you really need a new one," he advises. "The psychology of having to open up your closet, decide what to give away, and get it to the nearest charity (or garbage can) is enough to stop many of us from buying something new."
Estimated savings: From $10 to however much you would have bought otherwise.
"Think about the places you belong to as a member: your credit card, auto insurance, Costco, or your job. Each of these offers perks that most people ignore," Sethi explains. "By simply being a member, you get perks that can add up to thousands of dollars each year."
To use this tip effectively, figure out exactly what your memberships offer. For example, some car insurance offers discounts on major retailers, and credit cards often offer travel insurance and car-rental discounts.
If anything stands out, set a calendar reminder for when it will apply. Another good rule of thumb is to always check for perks before you make any big purchases.
Estimated savings: $100 to $2,000.
"Most Americans only think about cutting costs, resulting in frugality websites that frantically try to out-do each other with the most inane and meaningless tips of all," writes Sethi. "We forget about the lever of earning more money, which is the most powerful of all."
Try negotiating your salary at work, starting a second job, or freelancing for something you're very good at.
Estimated savings: $100 to $1,000.
If you find yourself eating out too much, stuff your fridge with perishables that you have to eat before they go bad. If you spend too much on shopping, unsubscribe from magazines or email lists that make it easier to make purchases.
"The simple fact is, if things are automatic, you will do them," writes Sethi. "Don't just look for where you're spending today. That's surface-level. Look deeper to see what's causing you to spend, and if you decide you don't want to continue, then eliminate those causes."
Estimated savings: $10 to $200.
It can seem counterintuitive to make purchases to save, but that's what some of the most successful money-savers do; they're not just buying things, they're investing in things — tools and services — that will eventually save them money over time.
"It's transparently easy to see money going out of your pocket right NOW, but it's harder to understand that you're actually investing in yourself," explains Sethi. "And when you invest in yourself, there's no upper bound on what your return can be."
Estimated savings: $50 to $1,000.
19 books to read if you want to get rich »
Advertisement