By David Bakke, contributor for Money Crashers Personal Finance, an online resource for helping people save money today and build wealth for the future
Summer is a time to enjoy the outdoors, spend time with friends, and just kick back. The problem is that many summer activities involve spending money - and when you throw a summer vacation into the mix, your finances can get out of hand in a hurry. However, if you're willing to put in the time and make just a little sacrifice, you can offset these increased summer expenses and develop habits that will save you money all year long.
1. Save on Groceries Believe it or not, clipping coupons and learning how to extreme coupon can save you loads of money. First, pick up multiple copies of the Sunday paper. Next, put together an informal filing system so you know when each coupon expires. Then, find out when your favorite grocer doubles coupons and shop on that day. You should also sign up for loyalty programs to receive coupons in the mail - these can often be combined with your manufacturer's coupons. If you commit to this model, your grocery savings could approach 80%. Also, consider purchasing generic brand items - the quality is often comparable, despite the lower price tag.
2. Lower Utility Bills Setting your thermostat three degrees higher can reduce your electric bill by 20% in the hot summer months. You can also open up doors and windows in the morning and evening when temperatures are cooler outside to reduce reliance on your air conditioning. And if you have ceiling fans, make sure they're on and rotating in a counter-clockwise direction - this pulls cool air upward. If you don't have a ceiling fan, consider getting one installed. Lastly, make an effort to reduce your water bill. Average water rates have recently increased by more than 40%. Take shorter showers, and only do full loads of dishes and laundry.
3. Reduce Other Monthly Bills Review your cell phone plan to make sure it's in line with your needs. For instance, unlimited texting or minutes are a waste of money if you don't utilize the features enough to warrant the expense. The same goes for your TV package: Ditch the 1,000 channels if you aren't actually watching them and consider cheaper options, such as a subscription to Hulu Plus, Netflix, or Amazon Prime.
Related: You Can Save $2,000 this Summer!
4. Impact Personal Spending Every time you reach for your wallet, ask yourself if you really need the item you plan to purchase. If not, put it back and save yourself some money. Eliminating the things you merely want but don't actually need allows you to powerfully impact your everyday spending. Newspapers, lottery tickets, snacks, sodas, and more can go by the wayside. It can be hard to imagine, but the little purchases really add up.
There's no need to go into debt to have a good summer. And though you may feel comfortable carrying a modest amount of debt, it puts an unnecessary strain on your finances and can negatively impact your credit score. If you carry credit card balances, work toward paying them off. Once you achieve this goal, set savings goals for your retirement account, children's education fund, or emergency fund. After all, no one is going to manage your finances for you - and the sooner you start saving, the better off you and your family will be.
What other ways can you think of to slash your budget this summer? Tell us in the comments.
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David Bakke lives in Atlanta with his young son, Nicholas. In addition to striving to set a good financial example at home, David writes about money management tips on Money Crashers Personal Finance.