Drowning financially? Do what ‘super savers’ do to get back on your feet

Maybe you’ve been holding off on reducing your spending hoping a better economy is on the horizon, or that you’ll start making more money soon.

Hope, isn’t a financial strategy; it’s a wellness technique used to help motivate healthy financial actions that assist in reducing money stress and anxiety.

But the reality is, if you can’t seem to stay afloat financially, you’re going to have to make sacrifices — big and small — at least until the economy and job market improve — and possibly for good. Here are a few to focus on:

Mimic the biggest money savers

CNBC recently reported on a group of people called ‘super savers.’ You probably know some of these folks. They’ve got a budget they follow, an emergency fund and are socking away money for retirement despite their incomes not keeping up with inflation.

Two financially key choices this group makes are driving paid-off cars a lot longer than the average person, and living in smaller, modest homes.

This community also appears to be leaning in to DIY at home to avoid hiring help; so, no unnecessary upgrades or paid home services when they can get by without, and redirect that money toward higher grocery costs and shoring up savings in the event of job loss.

They also are delaying larger scale travel — I know that’s probably not something you want to hear.

I like to think of this group using the ‘just lay low for a while’ financial strategy, where sticking to the basics is the best until times get better.

What if you did the same? You could simply make do with what you have for longer and avoid any spending that isn’t core to your essential needs. A nice byproduct of this strategy is that it almost always halts further debt accumulation.

Implement all the low-hanging-fruit strategies — this week!

Individually, these money savers are small, but added up can mean hundreds and thousands in savings.

According to Forbes, more than 40 per cent of your subscriptions aren’t being used, so comb through them and cancel most of them.

Renegotiate and bundle together internet and cell services (cancel the cable while you’re at it) as well as home and auto insurance. Set up these new plans to debit your bank account, not your credit card, to avoid piling up debt. This step is also an opportunity to examine any kind of recurring bill, like security or hydro, to explore savings.

Move to no-fee banking and a cashback, or no-fee rewards credit card. The goal is to pay little to nothing for your financial services. Loyalty rewards should be used up for essentials like groceries. Points typically lose value or expire over time.

Stop buying and ordering anything for convenience. Plan your groceries at the lowest cost store and if it means you need to have a loonie in your pocket for a cart, get one. The less fancy the market or shop, the more you’ll save.

Shopping with a meal plan will keep you on track and help you avoid last minute takeout orders and on-the-go coffee purchases. Ask ChatGPT to make you an economical and nutritious meal plan and grocery list if you’re stumped for recipe ideas. I use it and I find the suggestions extremely helpful.

Scour the second-hand market for any needs that arise, and sell off whatever you can. Take on extra work if it’s available. Say ‘no’ to expensive social outings or suggest a lower-cost alternative. Try a few days of no-spending to see how you feel and if it prompts new thoughts about your financial priorities.

If your lease or mortgage is up for renewal, meet with your financial planner to discuss options for downsizing, moving, or reconfiguring your mortgage. The same analysis can be applied to your car lease or loan.

There will be more ways for you to resurface financially and the fastest way to identify these opportunities is to build a budget that lists every source of income and expense in your household. Once it’s built you’ll start to feel relief just by knowing what’s going on with your spending.

Add an allocation to your budget for rainy day savings, even if it’s small to start. There are so many benefits when you take control of your finances at a time like this, you might just stick with these habits even when times get better.

This article was originally published in The Star. Lesley-Anne Scorgie is a Toronto-based personal finance columnist and a freelance contributing columnist for the Star.