7 Easy Ways to Find Extra Money in Your Budget

I was recently talking to a friend who was asking me about investing. He said “I want to invest, but I just never have any extra money. Maybe if I come into some money I can think about investing some of it.”

In my opinion, this is the wrong way to think about investing. You need to find the money in your budget, and then spend your lifetime putting it to work for you.

That may seem easier said than done, but I speak with experience here. I started investing while earning minimum wage and living in a garage apartment. I could have easily consumed that money by eating out once a week or moving into a bigger place, but instead I wanted my money to work for me.

In fact, cutting back on eating out is one of the easiest ways to find money in your budget. But that’s not painless. Eating out is enjoyable, so you are making a sacrifice.

Let’s talk about ways to find money in your budget that don’t necessarily entail sacrifice.

1. Consider a New Job

I have job-hopped my entire career. My first job with a regular paycheck was at a small grocery store in Oklahoma. I earned minimum wage, but I wasn’t content. Walmart (NYSE: WMT) paid a bit more than minimum wage, so I went to work for them. I was still in high school, but I was earning more discretionary income.

I still wasn’t content. While in high school, I got a job assisting the mechanic for United Parcel Service (NYSE: UPS). The trucks would come in each evening and I would wash them. Then we would do maintenance on them until midnight at times. We would do bigger jobs, like an engine overhaul, on weekends. Now I was earning double minimum wage.

After high school, I put myself through college working nights for Campbell Soup (NYSE: CPB). And once I graduated, I typically changed positions or employers every couple of years. Each time entailed a raise. That is perhaps the easiest way to find a bit of discretionary income, especially in a job market as hot as the current one.

2. Plan Your Meals

One drain on most people’s budgets is impulse buying. Grocery stores have many strategies for getting you to buy high margin items. There are a couple of tricks to avoid this. One, plan out a week’s worth of meals ahead of time. Then, make a list, go into the store, and stick to that plan. Don’t buy anything that isn’t on your list. Oh, and don’t go in hungry. I know from experience it’s harder to avoid those impulse items if you are hungry.

But the impulse may still be there as you are standing in line to check out. There’s often a way around that. Since the COVID-19 pandemic, curbside pickup or even delivery may be a better option. Many stores offer this for free. It’s probably not worth paying an extra fee unless you really have a problem with impulse purchases, but staying out of the store is a more viable option than it once was.

3. Bargain Shop

If you like to shop, I suggest starting at a thrift store. You can find scarcely used or even brand new items in many different categories. Your impulse buys here won’t hurt you nearly as much as they would in a department store.

Also look at nearby garage sales, especially multi-family or community sales. You can also find bargains on social media, but beware of scams.

Finally, if you do need to buy something retail, it’s often cheaper to do so online and have it shipped than it is to go into a store. My last two purchases of jeans have been online, a process that I wouldn’t have thought about a decade ago.

4. Cancel Automated Purchases

Many of us set up an automated purchase at some point, because it seemed like a good idea at the time. But we aren’t always so good about canceling that automated charge when it has outlived its usefulness. Look over your credit card and bank statements, and identify and eliminate any recurring charges that you no longer need.

5. Shop for the Best Cable and Phone Deals

Over the course of my life, I have hopped between cable and phone companies as often as I have job-hopped. I have found that many companies offer lucrative deals for new customers, but they aren’t nearly so generous when your contract comes up for renewal. That’s when it’s time to play them against each other, and simply select the best deal. In my experience, that usually requires switching providers.

6. Transfer High Interest Balances

If you have decent credit, your mailbox is probably full of credit card offers. Many will offer a low interest introductory period for transferring a balance. You might save quite a bit of money by transferring high interest loans to zero or low interest accounts.

But beware of those that reset after the trial period to an interest rate that is higher than you are currently paying. You could quickly eat up the savings in higher payments, unless you find another place to transfer that balance.

7. Look Into Alternatives for Your Prescriptions

Prescription prices are out of control, and they hit many of our budgets hard. Many uninsured people are unable to afford their prescriptions.

I am insured, but a couple of years ago I learned something interesting about discount prescription services like Amazon Pharmacy and GoodRx. I found that I could buy some medications through these services, and not only were they cheap, they were even cheaper than the co-pay on my insurance.

For example, Atorvastatin is a drug for high cholesterol, and the most commonly-prescribed drug in the U.S. It can cost as much as $100 a month retail, and you will typically pay perhaps a $10 copay each month with insurance. But GoodRx card holders pay less than $10 a month, without insurance. This is true for many commonly prescribed medications, so it’s worth checking out.

Most of these ideas require little to no sacrifice. Now that you have a bit of extra money, it’s time to put it to work.

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