Spend Less and Save More Mindful spending with FIRE Fidelity To reach your Financial Independence number quickly, you’ll need to save aggressively. But where do you find that extra money? Start by reducing your spending. You don’t have to be extreme if that’s not your thing. Just cut where—and how—it feels doable. Set it aside Set it aside Track and reflect Track and reflect Subscribe to a cheaper life Subscribe to a cheaper life
If I see money I can envision spending it — Kevin
Putting savings into a separate account is a great way to avoid temptation. You could have a fixed amount automatically sent out of your paycheck, save what’s left over at the end of the month, or something in between—but get it out of the account you use for everyday spending. Determine what to save. Set an amount you think you can safely set aside while covering your expenses. Find a separate place for it. Open a new account if needed to hold that money. Put it on autopilot. Create your system for moving money into that account—auto deductions from your paycheck or a monthly reminder to yourself. At the end of the month when everything is green I feel on track — Jessica
You can use a budgeting app or a spending diary to help you see what you’re spending money on each month and to set goals. You can also take a 30-second pause before you pull out your credit card to think about whether that vacation/jacket/laptop is worth it. Get ready to track. Sign up for a budgeting app, set up a spreadsheet, buy a notebook to record your spending, or set rules on your phone to tell you to stop and think before you buy. Work with your chosen system for a month. It takes 3 weeks to create a new habit, so be patient with yourself if it’s hard at first. Reflect at the end of the month. Is the system working? Are you happy with your spending? Could you cut more? Just by changing our supermarket we cut $100 a week off our grocery bill — Joanna
Most of our biggest costs happen on a recurring basis. If you can bring down your spending on one of the big three—housing, transportation, and food—you could make a huge jump in your savings. But giving up your car or moving to a cheaper town might not be realistic. You could start with small things, like dropping one of your streaming services or that gym membership you never use. A bunch of smaller cuts can add up over time. Assess your current spending. Look at your tracking system, credit card statements, or whatever data source is best organized, to look for spending categories that seem high. Make the easy cuts. Didn’t realize you still had a subscription you’re not using? Cancel it! Now look at the big stuff. Are you willing to move? Give up your car? If yes, then go for it! Set it aside Set it aside If I see money I can envision spending it — Kevin
Putting savings into a separate account is a great way to avoid temptation. You could have a fixed amount automatically sent out of your paycheck, save what’s left over at the end of the month, or something in between—but get it out of the account you use for everyday spending. Determine what to save. Set an amount you think you can safely set aside while covering your expenses. Find a separate place for it. Open a new account if needed to hold that money. Put it on autopilot. Create your system for moving money into that account—auto deductions from your paycheck or a monthly reminder to yourself. Track and reflect Track and reflect At the end of the month when everything is green I feel on track — Jessica
You can use a budgeting app or a spending diary to help you see what you’re spending money on each month and to set goals. You can also take a 30-second pause before you pull out your credit card to think about whether that vacation/jacket/laptop is worth it. Get ready to track. Sign up for a budgeting app, set up a spreadsheet, buy a notebook to record your spending, or set rules on your phone to tell you to stop and think before you buy. Work with your chosen system for a month. It takes 3 weeks to create a new habit, so be patient with yourself if it’s hard at first. Reflect at the end of the month. Is the system working? Are you happy with your spending? Could you cut more? Subscribe to a cheaper life Subscribe to a cheaper life Just by changing our supermarket we cut $100 a week off our grocery bill — Joanna
Most of our biggest costs happen on a recurring basis. If you can bring down your spending on one of the big three—housing, transportation, and food—you could make a huge jump in your savings. But giving up your car or moving to a cheaper town might not be realistic. You could start with small things, like dropping one of your streaming services or that gym membership you never use. A bunch of smaller cuts can add up over time. Assess your current spending. Look at your tracking system, credit card statements, or whatever data source is best organized, to look for spending categories that seem high. Make the easy cuts. Didn’t realize you still had a subscription you’re not using? Cancel it! Now look at the big stuff. Are you willing to move? Give up your car? If yes, then go for it! Mindful Spending
Kirra shares her philosophy on keeping her spending in line with her values—reflecting on what triggers her to spend money, and deciding whether purchases will get her closer to financial independence. She's 23, and already making progress toward Financial Independence. "I associate FI/RE with being restrictive, but I’m still doing bougie things." — Lucy Get some side hustle inspiration Ready to take action? The trademarks and service marks appearing herein are the property of their respective owners. Fidelity does not provide legal or tax advice. 925222.6.0