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13 ways to save more money in 2013


13 ways to save more money in 2013

It’s almost two weeks into 2013 and it sure is starting to look like the old year. Many of us made a resolution to save more money in 2013, but do we have a plan to do it? To help you start the new year right, here are some ways to save more in 2013.

13 ways to save more money

1) I’ll start off with the most difficult one: Keep track of all your expenses. You will be surprised at how much you spent on stuff that didn’t add much your life. Once you see how much money is wasted on those things, you’ll be more reluctant to spend.

2) Increase your retirement account contribution. The IRS raised the maximum contribution limit on both the 401(k) and IRA in 2013 by $500. Mrs. RB40 just raised her contribution so she’ll max out this year. If you contributed the  maximum last year like she did, then it will be relatively painless to raise it $500. If you’re not there yet, it is a good idea to increase your contribution so you’ll be able to max out eventually.

3) Open an online saving account to maximize the interest on your emergency fund. Aren’t you tired of earning 0.10% with your local saving account? Open an online saving account at CIT or Ally bank to earn 0.90% or more with your new account.

Institution APY Minimum Deposit Misc 1 year of interest on $50,000
 best saving account to stash $50,000 0.95% $0 $477.26
 best saving account to stash $50,000 0.90% $100 1.0% APY with a balance of $25,000 or more. $452.03
 best saving account to stash $50,000 0.75% $1 $376.29

4) Reinvest your dividend. The stock market did very well in 2012 and most investors should have made some money though dividends as well. Reinvest the dividend into more stocks and you will generate even more dividends in 2013.

5) Reduce your internet service and cable bill. Call your internet service company to see if you can get a discount. The worse they can do is tell you no. Usually, they will give you some kind of discount for 6 months with no hassle. Consider getting rid of cable while you are at it. You can watch shows on the internet or borrow them from the library for no cost.

6) Cut your insurance bill. Call a couple of insurance companies to see if you can cut your auto insurance bill. If you don’t drive much, consider increasing your deductible to $1,000. I only drive once or twice a week now and I was able to save a little money by raising the deductible.

7) Join the debt movement to get rid of some high interest debt. Those high interest debts are the enemy of saving. Paying them off will enable you to save more in the future. If you have any consumer debt, I would put this at the top of your list.

8) Take my 2013 No Spend Challenge and don’t buy any clothing for a year. This is probably pretty easy for most guys, but I’m sure it’s really difficult for women. Take a look at your closet, I’m sure most of us have well over 100 articles of clothing in that little space. Why can’t you go a year without buying new cloth?

9) Skip the coffee shop. Did you know the average American consumer spends over $1,000 a year on coffee? That’s a ridiculous amount of money to spend on coffee. You can get a French press and brew your own coffee almost anywhere and save a ton of money every year.

10) Cook at home to save money. I like going out to eat as much as the next person, but we try to limit eating out only once a week at the most. Eating out every day is terrible for your health and you’ll spend a lot of money to boot.

11) Plant a garden. Organic food costs a lot more than regular so we only buy a few selections like apples and cherries. However, there is a cheaper way to eat more organic fruits and vegetables – grow your own. We don’t mind a few holes here and there and it is good exercise to work in the garden.

12) Buy generic food and drugs. Check with your doctor if you can switch to a generic drug instead of brand name. There is no point paying more for the same thing. Also try different generic foods and see which ones can replace brand names. If you can’t tell the difference, switch to generic.

electric save money

We must be doing something right.

13) Buy some electricity saving devices. It will cost a little bit up front, but you’ll save money in the long run. Using less electricity is good for the environment as well.

Bonus to avoid unlucky 13

14) Quit your job. I’m telling you from experience that I saved a ton of money after I quit my full time job. You’ll be amazed what you can cut out when you don’t have a paycheck coming in. Well, make sure you have some savings and can survive for 6-12 months before you tell your boss off….

Well, I hope you enjoyed reading these tips. We all would like to save more money in 2013 and increase our net worth a bit. If you do a few of these things, they will get you into a frugal mindset and I’m sure you’ll be able to save more money this year. Do you have any good tips? Please share them in the comment. 

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Joe started Retire by 40 in 2010 to figure out how to retire early. He spent 16 years working in computer design and enjoyed the technical work immensely. However, he hated the corporate BS. He left his engineering career behind to become a stay-at-home dad/blogger at 38. At Retire by 40, Joe focuses on financial independence, early retirement, investing, saving, and passive income.

For 2018, Joe plans to diversify his passive income by investing in US heartland real estate through RealtyShares. He has 3 rental units in Portland and he believes the local market is getting overpriced.

Joe highly recommends Personal Capital for DIY investors. He logs on to Personal Capital almost daily to check his cash flow and net worth. They have many useful tools that will help every investor analyze their portfolio and plan for retirement.
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{ 50 comments… add one }
  • Greg January 11, 2013, 1:02 am

    I caught the LED lighting bug lately.
    Trying to find the right combination of things in the bulbs where needed.
    That can be tricky, I think.
    But in lights that are often on, it seems worthwhile to switch to LED lights there.

    Maybe a #15 – Switch to LED lighting if it makes sense to?

    • Ross January 11, 2013, 10:56 am

      The places where it tends to make sense to use LEDs are where you can’t use CFLs. The best opportunities (that pay for themselves in <2 yrs) is outdoor lighting that it one 12 hrs/day, as well as reading lamps. Anything on over 4 hrs/day will pay for itself quickly.

    • retirebyforty January 11, 2013, 1:24 pm

      We have one small LED reading lamp that double as a nightlight. It works quite well.

  • Sarah Park January 11, 2013, 1:06 am


    These are all wonderful tips! This year, I will start learning to cook more varieties of dishes to save us from going to the restaurants. It really saves a lot when you yourself is preparing the food.

    • retirebyforty January 11, 2013, 1:25 pm

      Cooking is a great skill to learn. It can be a lot of fun when you have time to do it.

  • Cherleen @ My Personal Finance Journey January 11, 2013, 4:26 am

    Great tips! We have been practicing these techniques since we chose to lead a frugal life. However, I would like to try the 2013 No Spend Challenge. Unlike other women, I am confident I can control myself from buying any piece of clothing within the year.

    • retirebyforty January 11, 2013, 1:26 pm

      Good luck with the no spend challenge!

  • Michelle January 11, 2013, 5:32 am

    These are all great tips! We are really working on eating at home as much as we can. Even though we fail at this occasionally, we have noticed a difference.

    • retirebyforty January 11, 2013, 1:27 pm

      Great job! Eating at home is so much more affordable and healthy. Restaurants put so much salt, sugar, and butter in their food to make it taste more rich.

  • Call Me What You Want Even Cheap January 11, 2013, 6:50 am

    I think we can do a bit better on buying energy efficient products.

  • Little House January 11, 2013, 6:54 am

    We’re putting our apartment on an electricity diet and trying to remember to turn off all lights, computer equipment, etc. to reduce our bill. It’s surprising how much energy two people consume!

    • retirebyforty January 11, 2013, 1:35 pm

      Good luck! I think we are using more electricity now that I’m home all day, but it’s still a small part of our overall expense.

  • Brick By Brick Investing | Marvin January 11, 2013, 10:26 am

    At the beginning of the year, I suggest cancelling all memberships that are not required. Then revisit them in March, if you’ve been fine without them then rock on!

    • retirebyforty January 11, 2013, 1:35 pm

      That’s a great idea. I’m not a member of anything though. 🙂

  • Mr. 1500 January 11, 2013, 11:01 am

    Regarding #4, most online trading companies allow you to automatically reinvest dividends by way of a dividend reinvestment plan or DRIP. The best part is DRIPs are usually totally free. No fee to sign up and no fee when additional shares are purchased at dividend time.

    #1 is absolutely essential. I was shocked at what we discovered when we started writing stuff down.

    • retirebyforty January 11, 2013, 1:38 pm

      Did you cut down on some expense once you discovered how much you spend? I like DRIP too and set up my IRA for that.

  • Jay January 11, 2013, 11:25 am

    Another thing to cut down on electricity bills is to install dimmers on higher-wattage lights. It saves money and the dimmer light adds to a calm and serene environment.

    Question for RB40: I’ve been thinking to start investing in a dividend fund. Which one do you suggest? I’ve heard Vanguard is excellent for beginning investors because of it’s low cost-of-ownership, but which fund do they have for DRIPs? Anyone know?

    • retirebyforty January 11, 2013, 1:41 pm

      I can’t recommend anything because I don’t want you to get mad at me if it doesn’t do well. 🙂
      Vanguard is good because of the low cost. They have a couple of dividend ETF that might work for you.
      You can set up DRIP through your brokerage. It should be quite easy to do. Call them if you need help, that’s what they are there for.
      Good luck!

      • Jason January 11, 2013, 4:51 pm

        Just set up my Vanguard account. I’ve learned that their most popular fund, the Vanguard 500, does give some dividend income. Because of this and their pretty low management fee, I’m going to put a little bit into this and see how she goes.

        I’ve also found out that, once your total investment is over 10k, they switch you to an identical fund that has an even lower management fee – I think it’s called the Admiral 500, or something like that.

        After researching, I’m still a little disappointed in the rate of dividend returns though. Many of the returns I’ve seen are only a few percentage points. Although better than putting it under the mattress or in the bank, it seems a bit anemic. LOL

        • retirebyforty January 13, 2013, 9:40 am

          Most funds only return a few %, but they will add up in the long run. Don’t forget that these funds usually appreciate over time so your investment will keep growing over time.
          If you’re just starting out, see the Vanguard ETFs. Their fees are about the same as the admiral funds.
          Good luck!

  • M.L. January 11, 2013, 12:45 pm

    Sallie Mae Bank has 90% on the High Yield Savings and 1.05% on the Money Market Account with no minimums. If you participate in the Upromise program, you get a 10% of your bonuses by the end of February of the following year if you link it to your High Yield Savings account.

  • krantcents January 11, 2013, 1:12 pm

    I am going to suggest the obvious, just increase your savings deduction! If you do not have a payroll deduction , get one. I find that if I have less money to spend, I actually spend less.

  • My Financial Independence Journey January 11, 2013, 3:56 pm

    Once you do point #1, everything else just sort of falls into place. At least that’s been my experience. Knowing where my money went first help me save more. Then the savings got turned into investments. Now I’m full on pursuing financial independence.

    • retirebyforty January 13, 2013, 9:38 am

      You’re right. #1 is huge. We have always been frugal, but we’re doing even better since we start keep track of all our expenses.

  • Jane Savers @ The Money Puzzle January 11, 2013, 5:54 pm

    #14 is the one we all hope to do. I would love to just quit my job but that is not in my future. My boss is great but I would love to tell a few coworkers what I really think.

    #10, cook at home, is my one big fail on the list. I love take out and fast food. So easy, so fast and so bad for wallet and waistline. #10 is the goal I am focused on for 2013.

    • retirebyforty January 13, 2013, 9:45 am

      Good luck with cooking at home more. Once you’re used to it, it won’t be much trouble at all.

  • Lance @ Money Life and More January 11, 2013, 8:13 pm

    Nice list. #14 takes a bit more prep than just quitting but if you have good options lined up I bet it can be pretty profitable!

  • Elizabeth @ Broke Professionals January 12, 2013, 11:24 am

    No new clothing for a year? I am by no means a clothing whore, but there’s no way I could take that pledge! I am going to open an online savings account, though!

  • Russell January 12, 2013, 11:37 am

    #5: We were paying $7 a month to rent a modem from our internet provider, but I was able to buy a used one for ~$50, which will pay itself back in 7 months.

    • retirebyforty January 13, 2013, 9:47 am

      Great job! I always buy modems as well.

  • Mike January 12, 2013, 4:12 pm

    If I might add, you could reduce your health insurance by living a healthier lifestyle. Not only does it keep you out of the hospital (and reduce your dependency on medications and stuff) but it might be something that you can use to reduce your health insurance bill as well. But that is just my 2 cents-you really do have a great list already lined out!

  • Diane C January 12, 2013, 9:08 pm

    So, I just did #14 first (12-5-12 at the ripe old age of 54). Can I work the list in reverse order?

  • [email protected] With a Few January 13, 2013, 8:28 am

    These are great tips! I spent so much money on produce last year that I am planning to start a garden this year. I will be talking to my husband about these other things you mentioned as well! Thank you!

  • RichUncle EL January 14, 2013, 9:52 am

    Great Tips. I like the fact that you can express how frugally one can live without having a job as you have first- hand experience. I have done most of these except for 7,8,11, and 13.

  • sin camisa January 15, 2013, 1:52 pm

    As Jimmy Carter said; “wear a sweater inside”. My bulbs are all CFL; but the big expense is heat. We are keeping the appartment at whatever nature wants it while I am in by myself (sometimes as low as 59°), then it goes to 65-67° when the family comes in. Everyone needs to wear their fleece.
    If you have electric water heater, lower the thermostat (very easy to do – just read the directions). Remember that their “middle” setting tends to be a bit too hot, so lower it just a bit. If you live in a house, there are other ways to lower your water heating bill (timer, replacing with tankless, etc). If natural gas is available (service on your street), ask for a quote and don’t be afraid of the upfront cost ($2-$3k) to bring it in, It will pay for itself in a couple of years.
    Find out what your state offers for solar power. No joke; it’s getting cheaper by the month; it’s making sense even here in cloudy Seattle. The equipment will last 25 years and it will pay for itself in about 7-10 years depending on the incentives you get locally. If you move before, your home will command a premium and sell faster.

    • retirebyforty January 15, 2013, 2:33 pm

      If I’m by myself, I would be under the kotatsu table most of the day.
      We are comfortable at 67 degree and use a space heater to achieve that. Our condo is well insulated though so we don’t have to use the heater that much. Solar would be nice, but it’s not an option for us right now.

    • Chris January 15, 2013, 7:33 pm

      Wow, you guys like it cold. Heck my own parents didn’t keep it that cold during the winter.
      We’re down to 73 for about 6 hours out of the day, and at 67-68 during the night using a programmable thermostat. This has saved us $800 for this winter so far (we used to keep it at 73 all day and night).
      Our house runs on propane (stove, hot water, and heater). And during the spring/summer/fall, we literally might get one time where they top the tank off.

      • retirebyforty January 15, 2013, 10:20 pm

        I prefer it a bit warmer, but I’m too cheap. 🙂 73 is quite nice.

      • sin camisa January 16, 2013, 6:22 am

        Wow; you must live down south. To keep a place at 73° you need a part time job just to pay for it.

  • Cassi January 15, 2013, 7:37 pm

    I’m going to be ending 2013 in a dorm room so sadly I can’t try every single thing on this list (And I don’t even want to think about trying to not buy clothing.)


    I want to try as many as I can. Thank you for the advice!

  • Greg January 15, 2013, 11:31 pm

    I think I’ve come full circle with your posts…
    I ended up at your blog because of the ‘HARP 2.0 isn’t working for me’ post.
    It did finally work for me, and dropped me from 5.75 to 3.75, and is saving me $500/month now.
    And I got to skip two payments, so just paid down $3,000 on a 30% credit card, so I’m joining the debt movement in this post, too :-).

    Cooling in the summer is something I need to get better at – I’m in Southern California – Riverside. I have a small (930sqft) single story house, and the A/C’s are somewhat dated I think.
    Electrician recommended a gable fan in the attic (I think that’s what he called it) – low power fan that blows hot air out of the vents on one side of the house.
    Has anybody used these, and do they make a big difference?
    I know there’s the whirlybird things on top of the house, but I liked the gable fan idea since it’s more inconspicuous.

    Also, for what it’s worth, I bought a couple of these solar LED lanterns – http://www.amazon.com/d-light-S10-Solar-LED-Lantern/dp/B004B924OG
    I was skeptical.
    And no, I don’t make any money if you buy them in any way…
    But at $16, I bought a couple, and they do provide a decent light source at night when the power went out here for a bit. I just leave them in the window.
    Probably not good enough for reading lights, but good enough to light a place so I don’t trip over stuff. I tend to be a night owl, so when the power is out I feel it a bit more.
    I also gave one as a white elephant gift at work, and my coworker says her young son carries it around like he’s camping at night.
    Seems like a good low cost source of light without having to deal with batteries all the time.


    • sin camisa January 16, 2013, 6:21 am

      Greg; attic fans are fantastic in dry climates. I lived in FL, where AC is the only way to survive because of the humidity.
      With an attic fan, you turn it on and open the windows in the house. It will pull the stuffy air from inside. It will bring the air from outside; some people open only the windows on the shaded (cooler) side of the house.

    • retirebyforty January 16, 2013, 10:09 pm

      Thanks for reading and commenting! I really enjoyed your input. It’s great to hear about your refinance! I’m very happy for you.
      My friend had one at his old house. The attic fan makes a big difference if it cool down enough outside at night. It helps get rid of all the hot air inside pretty quickly.
      Those LED lanterns look very neat. It’ll probably get smashed by our little guy though. Once he’s a bit older, I’ll try one.

  • patti January 27, 2013, 2:35 pm

    Thanks for the great advice.

  • STEVEN J. FROMM, ATTORNEY, LL.M. (TAXATION) February 23, 2013, 11:52 am

    Very nice group of tips. I just spent the last two hours changing my car, home and umbrella policy and saved big time.
    As to the online bank rates, readers should be aware that some of these places do not send you a hard copy of the monthly statement. So you need to be aware of that before investing. Also, you need to have this on your list of financial assets if god forbid something happened to you.

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