How to Save Money - Simple Steps and Ideas to a Healthier Financial Situation


Saving money might seem a near-impossible task when you have bills to pay. For many of us, maintaining regular financial obligations like a mortgage, car payment, and groceries can leave little cash left over for savings. Even for those of us that have our finances under control, it’s always worthwhile to check if there are money saving opportunities elsewhere.

If you’re serious about saving more money, here are universal steps to take and ideas you should consider no matter your financial circumstances!

Reduce Expenses When You’re Paying Too Much

One of the most fundamental ways to save money is to reduce major expenses in your budget, beginning with a review of your regular monthly bills. Any recurring payments present an opportunity to cut costs. When you trim a monthly bill, it saves you money every month!

Sometimes reducing a regular bill is as simple as taking some time to see what else is out there. Look for better car insurance rates, or a discount if you bundle insurance products. Likewise, it’s worthwhile to spend a weekend afternoon shopping for bank accounts with lower or no fees, or switching to a better mobile phone plan. Saving as little as $9 per month will put more than $100 in your pocket over the course of a year!

And if you really want to make a dent in your monthly budget, try to see if it’s possible to refinance a mortgage for a lower interest rate. Since housing is often the largest expense in most budgets, focusing your spare time on reducing housing-related costs could very well give you the biggest expense reduction relative to the amount of time you spend researching.

After you’ve reduced major expenses, move on to cutting down smaller ones. Try to scale down utility bills and consider switching to generic instead of brand name foods at the grocery store. Once you start looking for opportunities to save money, you’ll be surprised how many you find!

Following this principle, the first step in your New Year’s saving plan should be determining what takes the most money out of your budget. I’ve detailed the biggest chunks of my monthly budget below, but yours may very! Keep in mind that I’m a working student in Toronto—AKA, strapped for cash. However, my tips for saving in each category are pretty universal:

  • RENT – $550
  • GROCERIES – $150

To specify, my budget for eating out includes things like catching happy hour with friends, buying a date a beer, or tickets for events. Personal care includes items like hygiene products, makeup, and prescription medication. Some aspect of each category is relevant in any budget – and the money saving tips are too.


It’s a common misconception that the cost of your housing is finite, and difficult or impossible to reduce, especially if you’ve already decided where to settle down. Most budgets dedicate at least 30% to housing, meaning it’s often the biggest component of a budget. This means it’s maybe the most important section to try to save money!

If you’re in the position of looking for a place to live, use the clean slate as an opportunity. Each time you go to a showing, ask the landlord if the potential rent is neogtiable. There’s nothing to lose in this situation, and it may surprise you how often rent can be negotiated, especially if you live in a city with lots of options for renters. I live in Toronto, where available rooms are sparse, and I was still able to cut $100 off my current living situation each month by negotiating with my landlord.

If you’re truly strapped, you may want to take the time to decide what sacrifices are worth making in your potential new place. If it’s $200 cheaper to live in the next neighbourhood, or you could save $500/month by getting a roommate, that might be the best option for you. Also, consider whether utilities are included in the set rent price. This could be preferred or avoided, depending on your lifestyle. If you work at home, you would be gobbling up more utilities than if you’re gone more often. Take a moment to decide which option is best for you when you’re looking for a place.

Even if you’re already settled into a living space, there are still a few money-saving ideas you can act on. If you’ve decided to take a place where utilities are not included, take some time to research the best companies to use. It could also be helpful to set up reminders like hand-written notes above your light switches, setting a timer when you take a shower, or setting a reminder on your phone to turn off the heat before you leave for the day.

Another saving tip I passionately evangelize is to keep an eye on the average cost of living in your area! If there’s a significant decrease in rent costs, don’t be deterred from confronting your landlord about it. Provide him/her with the relevant statistics and ask for a reduction. The market fluctuates so frequently; you’re robbing yourself if you continue to pay a disproportionately high amount of rent.


At the end of every month I am perennially shocked at how much of my income went toward food. At this point I’ve lowered the limit to about $150, but that’s only been possible by carefully modifying my shopping habits.

My most obvious tip is coupons, coupons, coupons! Look online prior to shopping trips to find coupons either on a store’s official website or on coupon sites like Retail Me Not. If you frequent a certain store, ask if there’s a membership rewards program you could join. You can also save by buying with a cashback card that offers good returns on groceries—just be sure to pay your balance off in full at the end of each month, lest you lose money due to credit card interest charges.

Finally, I always try to go grocery shopping more often with less bought in each trip. This means I can scout for fluctuating sales more accurately, and it also means I’m less likely to throw out food gone bad. It’s extra convenient for those that live close to the store. Close proximity to your grocer means you can walk and carry groceries home, saving on gas.

Social Life

If I don’t work social expenditures into my budget, I end up caving in to spur-of-the-moment situations and doing unnecessary damage to my bank balance.

To save money, choose outing locations based on deals or specials. Follow your favourite spots on social media. Businesses will often post limited-time offers on their social channels, and sometimes the offers are exclusive to their followers. I also usually eat at home before going out. We all know that the social aspect of going out is the real focus. If you’re strapped for cash, fill up on affordable homemade grub and then just buy a drink or two at the bar!

If you’re looking to save even more money (like I am), consider replacing eating out with a night in with friends. Buying a couple bottles of cheap wine and settling in with some horror movies is probably my all-time favourite activity! And it’s delightfully cheaper than going out.

Personal Care

As with groceries, coupon and rewards programs are available for most stores that retail personal hygiene products or makeup. If you’re looking to save even more (or help the environment), I always suggest making your own hygiene products at home when you can. I use apple cider vinegar for conditioner and make my own shampoo with organic soaps and essential oils. This entire year I’ve spent $30 on hair products.

If you buy prescription medications, ask your doctor if there’s a cheaper brand you can switch to. There’s often a generic brand that is essentially the same at a lower price. Just be sure to verify with your doctor that they would recommend switching, in case of side effects. But in my experience most of the time there aren’t any real downsides to a swap.

Start Budgeting for Real

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A budget isn’t just about restricting or limiting your spending. It’s about allocating your money where it needs to go to give you the life you want. If you don’t know exactly how much money you have or where you’re spending it, chances are your money’s not going to the right place! A good budget includes a category dedicated for savings, with a fixed amount you contribute each month.

Finding the right balance for your budget isn’t an exact science. Some people will want to budget more for leisure, while others will be more saving-focused and can budget accordingly.
If you need structure in your budget, though, one rule to consider is the 50/20/30 rule. It’s simple and surprisingly effective. Here’s how it goes:
  • 50% of your budget should be allocated towards essential expenses
  • 20% of your budget should be allocated towards income
  • 30% of your budget should be allocated towards your own discretionary spending

You can make a budget in a notebook or spreadsheet if you want to do it the old school way, but there are tons of budgeting apps out there to make the process faster and more precise. These tools will track your spending, help you pay off your debt, and motivate you to meet your financial goals.

Pay Off Debt

If you have debt, you have money going toward a balance owing that would otherwise stay in your pocket. To eventually reclaim this cash flow as your own, you need to pay off the debt.

One of the reasons people often struggle to get out of debt is because their debts have high interest rates. Consumer debts, like credit cards, often have interest rates around 20%. These debts are hard to pay off, because frequently a large portion of each payment goes toward paying off just the interest rather than paying down the principle balance itself. For this reason, one of the best things you can do to get out of debt quickly is find a way to reduce your interest rates.

The best way to save money on interest is to move your debt (or debts) to a lower interest rate. Balance transfer credit cards can accomplish this, as they allow you to move your debt from a high-interest credit card to a lower-interest one. Other means of reducing the interest rate on your debt include personal consolidation loans or even taking out a consolidation loan from a life insurance policy. When it comes to evaluating possibilities, look for the lowest interest rate with the most manageable repayment terms for your budget.

Once you’ve moved your high-interest debt to a lower interest option, it’s imperative you don’t build up the debt again. If you’re worried about staying disciplined, cut up the high-interest credit cards or even close the accounts so you’re not tempted to ring up the balances again.

Pay Yourself!

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If all your bills and debts get their own category in your budget, you should too. Once you know how much you can save each month, set up an automated savings transfer from your chequing account to a high-interest savings account. This will make your savings feel like a regular monthly bill, except the money is going to you!

If you’re trying to figure out how to save money fast, look for saving apps that can help you meet your goals. There are plenty of tools out there to make savings easier through special features like offering cash back or rounding up purchases to the nearest dollar and saving the difference. This is the perfect solution if you’re not a natural saver and want it to happen automatically.

Make Your Money Make You Money

Once you’ve managed to set a little money aside, the best thing you can do is make it work for you. Instead of leaving your cash to languish in your chequing account earning no interest, invest it to earn the highest return you can.

If you’re intimidated by the prospect of investing, you can choose a hands-off approach like mutual funds or a robo-advisor. If you’re more comfortable taking charge of your own portfolio, you can invest in stocks, bonds, and ETFs through a brokerage firm. Make sure to put your money in a tax-advantaged account like the TFSA, RRSP, or RESP to really get the most bang for your buck. Still feeling overwhelmed? Seek out a fee-only financial advisor to guide you in the right direction.

Earn Every Time You Spend

Supercharge your savings by topping it up with cash you earn by spending money! Cash back and rewards cards can generate extra income for every purchase you make. You need to pay bills and buy groceries no matter what, so you might as well earn a little extra income doing so. Even small amounts add up over time, so don’t shy away if the return seems low at first. 1% doesn’t mean much on a single grocery bill, but after a year of buying food it can add up to quite a bit!

These money saving tips will help you no matter where you’re starting from. Whether you’re saving for a specific goal or just for a rainy day, there’s plenty you can do to put away money today for what you want tomorrow.