7 Ways to Save on a Tight Budget

March 23, 2023

 In these times of high inflation, many individuals and families are finding it difficult to save their hard-earned money. In fact, research^[1] shows debt is piling up for the average consumer as credit card balances hit an all-time high of $930 billion in the last three months of 2022. Additionally, the high costs of goods and services are making it tough for many Americans to handle the cost of an emergency. Our most recent Wellbeing and Your Wallet Index^[2] found 46% of people are not confident in their ability to handle the cost of an emergency, including 58% of Gen Z adults.

Affinity knows it isn’t easy for most households to save money, especially in these times, with regular and unforeseen expenses ranging from daily necessities to a sudden misfortune involving one’s health, home or car. How can you make small changes to save money without significantly lowering your standard of living? In the spirit of helping members spend smarter, here are seven ways to save money on a tight budget:

1. Smart supermarket shopping: There is no shame in seeking out the best prices for everyday food and other household items. In fact, more people are turning to dollar stores or discount supermarkets for their food shopping – more than one in five^[1] based on recent data from Coresight Research. We also recommend “buying in bulk” when it makes sense. If an item is on sale or is available in a large, packaged quantity at a better unit price, take advantage of that deal. It may be inconvenient in terms of transporting and storing those items, but it will definitely save you money.

2. Reassess your ‘want’ purchases: Maintaining a tight budget can’t be done without keeping your ‘want’ purchases in check. It’s good to ‘treat yourself’ to an expensive coffee or another low-cost item from time to time but consider how often it makes sense. Also think about instituting a “cooling off” period of a day or two when you see something you ‘want’ that comes at a considerable price tag. While catchy store displays or targeted online ads could reel you in, it’s important to think over a purchase, especially if you are an impulse buyer. Consider limiting your shopping to stores or websites that have generous return policies for when that buyer’s remorse kicks in.

3. Seek out credit card(s) with better terms: In these times of high interest rates, assess whether you can find credit cards with no interest rate, or a much lower rate, for the first few months or even a year. Also look for cards that don’t come with an annual fee. Fees on credit cards can be so slight or charged annually that you don’t really notice them, but they add up. Another option, as highlighted in this article from Bankrate^[2], is to simply contact your credit card issuer and ask for a lower APR. Be sure to check out Affinity’s credit card offerings^[3] to see if you can get a better deal.

4. Use cash back credit cards: If you don’t already have a credit card that provides at least 1.5% cash back on everyday purchases, consider transferring your balance to a card that does. So as long as you limit spending to items you usually buy, or large mandatory expenses like home maintenance, this is a certain way to save money. If you’re an Affinity member, consider our Rewards Visa Signature card^[4].

5. Cut down on digital subscriptions: Whether it’s a lineup of streaming television services or food delivery apps, it’s likely you’re not using all of them on a regular basis. Assess which digital account, or accounts, you can do without and cut ties with those subscriptions. Instead of relying upon food and retail store deliveries, consider picking up those orders instead.

6. Reduce home energy costs: A few changes at home can result in lower costs on your energy bill. Consider taking shorter showers, fixing any leaky pipes or faucets, washing your clothes in cold water and installing LED light bulbs. For those who use window air conditioner units, consider swapping out your old A/C unit for an energy saver before the summer heat kicks in. If not, running old units could spell trouble for your utility costs.

7. For an auto loan, look outside of your dealership: For many people, no matter the state of the economy, a vehicle is a necessity. When you’re at the dealership and are shopping for that new car, it’s so easy to get caught in the moment when you and your salesperson come to an agreement on a monthly cost. That’s why it’s important to do your homework ahead of time – see what rate and terms your trusted financial institution can provide for an auto loan. In many cases, it can be much better than what the manufacturer’s bank can provide. At Affinity, you can get preapproved for an auto loan^[5] 45 days before you set foot in your new car, truck or SUV.

Taking these steps can help you save money, reduce your financial stress and improve your financial wellbeing. To learn more about the financial wellbeing resources available at your fingertips, visit our website^[6].