Living within or below your means is one of the things Dutch people pride themselves on. You can call them stingy and cheap, but honestly, they are just being frugal and smart. There is even a very popular saying here in the Netherlands “geld lenen kost geld.” This essentially means “borrowing money costs money.” Whatever you may think of their spending habits, they are good with money. A lot can be learned from how the Dutch live and spend. They have proved that living frugally doesn’t have to be difficult.
Where Is Your Money Going?
The first step to being better with your money is knowing where your money is going. The majority of people spend more than they think they spend. It’s so easy to lose track of your money and end up in the red. I know many people that make a decent salary and still don’t have money left over at the end of the month. There are many reasons for that. The first reason is that they have no clue how much they spend. Creating a reasonable budget is essential. Knowing how much you make and how much your expenses are is how you can start.
Now, beyond your expenses (rent, food, transportation, phone bill, etc), you must be realistic with budgeting for fun things. Let’s say if you make 2000 a month and your expenses are 1800 a month, don’t put 175 into savings. That is completely unrealistic. That 25 is not going to make you feel like you’re working for a purpose. Either reevaluate your expenses and try to lower them or find another stream of income. You can’t just work to pay your bills and save. You’re going to burn out that way.
Lowering Your Essential Expenses
There are many ways of cutting down your essential expenses. For example, every year, my partner Kevin and I compare and contrast different health insurance plans. We switch to the one that is less expensive and is the best fit for us. I saved €120 just by switching health insurance this year. That’s a lot of money. You can do the same with the companies that provide you with water, gas, electricity, WiFi, cable, and more. Some companies even have incentives for switching.
When going on vacation, taking the cheapest flight isn’t always the cheapest. You won’t get miles and you won’t get food, drink, or luggage. If the flight is canceled, your hotel stay may not be covered. Hotels can often be cheaper than hostels when traveling with a friend. A lot of hotels offer breakfast that’s included in the price. When splitting the cost of the hotel with breakfast between two people, it can be even cheaper than staying in a hostel. Instead of going out for every meal, maybe buy some stuff like bread and cold cuts to eat for lunch.
I recently traveled to Dublin and didn’t spend a whole ton, in my opinion. I was there from Thursday night to Monday afternoon. Including my flight, hotel (split with my friend), food, transportation, activities, etc, I spent about €394 ($449). We stayed in Dublin, but also visited Malahide Castle and Galway.
Changing Where You Live
When it comes to renting, you don’t always have to live in the city center. That is usually the most expensive place to live. Consider moving outside the city center or even to a nearby city or town. You may have to commute a bit more, but the money you save, even with your extra commute time, can be worth it. Also, consider moving to a smaller place. If you’re never home, it may not be worth it to have a giant apartment. If you rarely have guests, maybe you can get an apartment without a guest room. There are so many possibilities.
Impulse spending is something we all do, including me. But there are ways to enjoy yourself and not break the bank. Before buying anything, ask yourself a series of questions.
How long will this item last? Can I get it somewhere for better quality so it’ll last longer? Can I get this somewhere for less expensive? Do I need this or do I want this? How many times a week am I getting this and can I cut it down by a few days? Can I borrow this item from a friend if I’m only going to use it a few times? Do I have this at home and can survive a few hours without it? Consider even just thinking about it for 24 to 48 hours. If you still want it, then maybe buy it. Just don’t impulse buy it.
Try to Always Prepare for Every Situation
Preparing for situations is also important. Bring lunch to work. Buy a coffee machine and to-go cup and make your lattes at home. Fix something immediately when it breaks instead of waiting for the whole thing to break. Eat before going grocery shopping. Use a grocery list and even meal plan if that will help. When cooking, make enough for several meals and freeze it.
Peer pressure can be extremely hard. I get it, believe me. I used to live in New York City. But it’s important that your friends respect and support you. If you don’t want to spend the money, say no or it’s not in my budget. Perhaps instead of going to the movies, do a movie night at home. Instead of eating out, cook together or have everyone bring something. Instead of going to that paint and sip, but all the stuff and watch a free YouTube tutorial. The possibilities are endless. I’m not saying never go out. I’m just saying cut it down to less often.
Feel Free to Reach Out
I love helping people save money and get ahold of their finances. If you’re looking for some financial advice like how to make a budget, contact me. It’s one of the services I offer as a business owner. Feel free to ask a question in the comments as well, and I’ll try to answer it.
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