How to Save Money on Necessities


Do you maintain a household budget? Everyone should, but only one-third of Americans actually keep a formal budget. Not only is the purpose of maintaining a household budget to track where your paycheck goes each month, but it’s also to help you save money. As soon as you start tracking where your money goes, you can start to identify spending patterns, including areas where you may be overspending. You can even find ways to save money on necessities such as food, utilities, and transportation.

You can always find ways to save money, no matter how you structure your budget. In fact, Americans waste a lot of money. Consider that nearly 40% of millennials overspend in order to keep up with their friends, according to a Credit Karma survey, and two-thirds feel remorse for spending more than they could afford in social situations. Also consider that 85% of Americans are actively trying to decrease their debt and 74% are carrying credit card debt. If you can find ways to save on necessities, then that’s money you can put toward things you would rather put it toward, or paying down your debt.

Simple Strategies to Save Money

The best place to start is by creating a budget and organizing it as a list of necessary expenses and discretionary spending. As soon as you start to identify where your money goes, you can take a hard look at ways to cut costs.

Many of those necessities in your budget have variable costs, such as food and utilities. Before you can determine if you are saving money, you need to create an average monthly expense so that you can create a baseline against which you can measure savings. Monitor your expenses for a few months and average out monthly expenses for household necessities. Now you can start thinking of ways to save.


This is one of the most obvious areas where you can save and the trickiest. You don’t have to give up the foods you love, or even shop for less expensive brands (although that helps), but you do need to be mindful of your grocery spending.

  • Start by shopping with a list of what you need and stick to it to cut down on impulse purchases.
  • Shop for bargains. For example, if there is a particular beverage you like and there is a sale, stock up.
  • Buy in bulk to save money. For example, you can buy just enough boneless chicken breast for dinner at $7.49 a pound, or you can buy half a dozen breasts at $3.99 a pound and freeze the surplus so you can save money in the long run.
  • The biggest challenge with grocery shopping is buying more food than you will use. Americans waste 150,000 tons of food each day. Don’t buy what you don’t need.
  • Coupon clipping is another good way to save on groceries. Also, watch for store specials such as discounts and two-for-one sales.

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Utility costs are typically based on consumption, so if you can cut down on what you use you can lower your utility bills.

  • Conserve water by being smart about how frequently you water your lawn, taking fewer showers, doing larger loads of laundry, etc.
  • If you don’t have a low-flush toilet, you can conserve water by placing a brick or a full gallon jug in the tank so you consume less water.
  • Conserve electricity by turning off unused lights. Also unplug all those energy vampires such as the DVD player or battery chargers that consume energy even when you aren’t using them.
  • Adjust the thermostat to use less energy for winter heating or summer air conditioning.


Whether you are commuting to work or just running errands around town, there are ways you can save on transportation.

  • Plan your trips so you can consolidate activities to cut down on driving.
  • If you use mass transit, save money with a prepaid transit pass.
  • Watch for less expensive gas, and use discount points to save money. For example, Safeway store points can be used for gasoline discounts.

Tools to Help You Save Money

How you pay your bills can also help you save money. By using the right types of credit cards and bank accounts, you can save or earn money back on purchases.

One way to manage your food shopping is to use the same credit card to pay for all your groceries. If you choose a card that offers cash back, you can earn cash on your grocery spending and see all your food expenses in one place. Just be sure that you pay off your grocery spending each month, or you will defeat the purpose of saving by accumulating credit card debt.

You can also look for bank accounts that give you cash back. iQ Credit Union’s Easy Saver program, for example, rounds debit card transactions up to the nearest dollar and deposits the difference in your savings account so that every time you make a purchase with a debit card, you make money. And you can use your debit card like a credit card to pay bills online.

Mastering the basics of money management makes it easier to save money on all your expenses, including your monthly necessities. Start by establishing a baseline for your household spending so you can track your progress as you try new money-saving strategies. To help you get started, use our handy Budgeting Checklist to help you determine where your money goes. As soon as you have a comprehensive household budget, you can start to save.



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