The main question I go through with my clients and those I advise is how to save money. If you want to retire early, you must save money. But how? Although this is a simple question, only the right actions will do the trick.

I actually answered this question on Quora in December 2016, which ended up getting almost 100k views. This post is the result of a huge compilation of savings tips and tricks to save money that I’ve been using over the years. You may find that some of these tips don’t work for you. That is fine. Simply try to apply those that do. Without further due, let us get to it…

How to save money: 20 saving tips you can use right away to save money

The first thing you have to do when asking yourself how to save money is what is actually how much is realistic to save. In my case, I make about $2400/mo net, so I decided that I had to save at least $1600/mo. I will not say that each and every one of you can do this. Yet, most of these tips are applicable by almost everyone.

1 – Pay yourself first

Again, to start saving money, you must first define what is reasonable to save. You can certainly live off of 30%, as I do, but you will need to be an avid fan of minimalism. On top of that, you need to have a burning desire to save money. In my own case, I want to retire because I have CFS, which may prevent me from working..

If you figured this out, set up a savings account if you don’t have one yet. Then, simply transfer your savings as soon as your salary clears on your account, every month. I often recommend people to set up automatic transfers because they tend to work way better than manual transfers.

Buy assets on credit and try to aggressively pay it back

What really motivated me to save money was to pay back credit. Going to the bank and paying down my mortgages. Paying off the credit card debt I used to advertise my book “My strategy to retire early“.

Maybe you’re hypersensitive to credit. If that is the case, don’t use it.

Also, when the dividends of my stocks clear, I buy more stocks, so I never get to have the chance to spend the dividends.

Note that I do not advise people to use credit unless they really know what they are doing!

2 – Withdraw money from your account for the entire week

It is much easier to use your card to pay for your expenses, so you tend to spend more that way. If you get cash and use it, you tend to stick to it in a much more powerful way than using your cards. I’ve noticed that this greatly helped me. Now, if we’re not talking about great amounts of money, I actually think you should withdraw money for the entire month. Just try it out and see whether you do better.

3 – Record every single transaction you make

You may think this is contradictory with tip #2. It is not! Although it would be easy to record every transaction if you used your cards, you’d tend to spend more. Cash out and use apps for smartphones. Just google up one, there are plenty. Use the one you like the most. The biggest advantage of doing this is that you realize where you spend your money – and maybe change your spending habits for the better!

What happened with me is that I became so disciplined about spending money that I stopped recording where I spent money, with the same results. However, I do understand the value I gained by having done this!

4 – Shop on a budget

I entitle myself to spend a given amount of dollars at the supermarket. In order to do that, I always write down what I need before actually going there. And most importantly, I stick to whatever is on the list!

I follow pretty much the same diet all year long, I know what I need straight away. Plus, I know the prices I normally buy my groceries at, so I can go to a different supermarket and buy only if the price is lower.

5 – I take advantage of the intrinsic value of my money, by buying in bulk

I usually target high expiration date items, that can come in large containers. Rice is one example. I typically buy the best organic rice at a lower price than the average rice brand. This is only possible because I buy 20-50KGs (about 40-200lbs) at a time. Another example of what I buy in bulk is toothpaste.

I also buy in bulk whenever an occasional sale of a product I already use comes up. Note that I didn’t say “whenever a sale comes up”. It must be a sale of a product I already use so I know that I am not buying just because it is cheaper than usual (which can, in fact, mean more expensive than the products I usually use).

6 – Avoid big sales and Black Fridays

Right. Take advantage of sales that feature the products you already use and trust but avoid the big ones. Why? Because in big sales like black Friday you are compelled to buy products you don’t really need. The only back Fridays I take advantage of are stock market black Friday. 🙂

7 – Turn off the television and the computer at night

You will save on the electricity bill. You’ll be less exposed to ads that compel viewers to buy stuff they don’t necessary need. I personally got rid of television for good about 8 years ago. Feeling bored? Read great books instead. Go online and learn new skills. Meditate (Affiliate link).

8 – Read on how to save money

Yes, posts like this very same one. But this is not necessary the end of it. Look for more articles. Read books that will help you even further. Browe the internet for more articles. Learn from people who did it successfully in the past.

If you are self-employed, I definitely recommend you to check this and this sources.

9. Practice minimalism: stop buying and start selling

As I am currently in the process of moving to a new home, I wanted to make sure that I start off with the right foot. To accomplish that, I will write down a list of items I want to have in my home and stick to it. In addition, I will use the 1:1 item rule: to bring home another item, I have to get rid of one I already have.

People don’t realize it, but having many things is a lot of stress. Try to keep the minimum. Get rid of what you don’t need, by selling it online or market fleas. You’ll save money and make money. Win-win.

10 – Buy used, not new

I buy a lot of books (btw, as a 10.1 tip, aim for free books whenever you can!). The vast majority of them are used because I get a huge discount and yet, they tend to be in very good condition. Whatever you can buy used instead of new makes you saving money and help the planet.

Books are only one example. Another example would be a car, which I would never buy new. It depreciates too fast on my balance sheet. 🙂

11 – Negociate your mortgage

Having two mortgages myself, and a third one on the way, I feel competent to talk about this. Go to the bank and negotiate your mortgage! I do that every 4-6 months, or sooner if I feel that I have new arguments to negotiate. For instance, if I rent out another of my units, I try to negotiate my mortgage down. In fact, if you think about it, every month that goes by, the more creditworthy you get (assuming you don’t default)!

Your mortgage is probably your number one expense so you must be addressing it if you want to save money! Don’t be afraid of hearing the bank telling you no. That is for granted.

12 – Quit smoking. Please!

I cringe whenever I hear someone telling me they need to save money while they smoke a cigarette. Please, do me and yourself a favor: stop smoking! This is one of the best ways to start saving money because if you’re a smoker you are certainly spending lots of money on cigarettes. And smoking is SO expensive!

On top of that, it will largely benefit your health. Smoking has been shown to cause major problems to your health.

13 – Be a coupon and gift card savvy grinder

This is really for those who master the science of how to save money. So, coupons are a great way to save money. However, as I said in tip #6, you should not buy something just because it is on sale. Same thing with coupons if you’re really looking how to save money. Search for coupons everywhere and use them wisely. Don’t use coupons for products you don’t buy already. Search for coupons by typing the names of the products you already buy. Ask your favorite grocery whether they have coupons.

14 – Don’t change your cell phone

We live in a society which excludes us if we don’t have the latest gadget. Don’t go with that trend. Changing your smartphone every few years is fine, but buying the latest one all the time is certainly not a sustainable idea.

Stick to your gadgets until they don’t work anymore. Remember your excitement (if you were) when you bought them. Remember all the good things you’ve done with them. Change them when they stop working.

15 – Change to LEDs

My father comes from a very humble family. He greatly appreciates what he has right now because his family didn’t even have enough to eat. Yet, he remains super frugal and moderate. He used to float around the house turning lights off and complaining with me and my brother when we were younger. We were not particularly good at turning the lights off, you see. 🙂

Two years ago, I convinced my father to change to LEDs. I knew he was the best guinea pig I had to test whether it worked. It took me one electricity bill to become a devoted fan of LEDs. They truly work, and their price is coming down quickly, as the technology evolves. Do yourself an experiment at your own home!

16 – Pack food for the day

Start saving money is easy if you write down your monthly expenses and address the biggest ones. As I said in tip #11, your mortgage should be addressed first because I am sure it is one of the main expenses you have, if not the biggest! Food comes right after, I am sure. This is especially true if you go out for lunch. Going out for lunch every day of the week for 10 years translates into about $40k, if you spend an average of $15 per lunch.

Seriously, pack your meals. Grab what is left of yesterday’s dinner and take it to work, so you save on lunch. Make a healthy sandwich or salad. Won’t take you much time but will certainly alleviate your wallet!

17 – Downsize

Bigger homes mean more expenses, it is that simple. Downsizing is such a great way to save money! All too often, smaller homes mean also cheaper acquisition costs. If you downsize and you’ve got a mortgage, you’ll pay less for your mortgage. If you paid your home off already, you can take the extra cash and invest it. In general, you’d save on maintenance and utility bills, at the same time you create more income. Win-win!

18 – Write a “how to save money” list

This can be way more effective than it looks like. If you write down the list (and actually read it every now and then) you’ll remember what you should be doing! On the back of the list, write down the prices of your most common groceries. Next time you buy them, you’ll have good comparison terms.

19 – If you do use credit cards, choose those with cash back

This one is pretty self-explanatory. Although it really comes in the first pages of many books on how to save money, not many people do this. Choose credit cards with cash back and benefits, if you really have to use them. A reason to use credit cards is to get lower interest rates on your mortgage, as banks often do that when you get credit cards from them. Use all the benefits of credit cards – call their customer service and have them sending you the entire list of benefits!

20 – Cancel unused memberships and negotiate bank fees

I have made this mistake myself: I went on for a few good months with a club membership I never used. That was $40/mo, so we are not exactly talking about peanuts here. When I first started to think how to save money, this was one of the immediate things I changed. I have no memberships now. I pay for my gym “membership” on a monthly basis (which is 7% more expensive). As I don’t workout in August, it ends up being equally expensive – although I only pay for it if I am really using it!

Bank fees are another major component of how to save money effectively. Have your bank statements scrutinized every month and make sure you have no unknown fees popping up. If you do, question the bank right way – and don’t forget about it!

21 – Refinance high interest debt (to lower rates)