9 Ways to Double Your Savings (THIS Month!)

Transcript:

On this episode of the personal finance podcast, nine ways to double your savings this month.

Crack a lacking and welcome to the personal finance podcast. I'm your host, Andrew Fowler of master money. co and today on the personal finance podcast, we're going to be talking through nine ways to double your savings this. Month. If you guys have any questions, make sure you join the master money newsletter by going to master money.

co slash newsletter. And don't forget to follow us on Spotify, Apple podcast, YouTube, or whatever podcast player you love listening to this podcast on. And if you want to help out the show. Consider leaving a five star rating and review on Apple podcast, Spotify, or your favorite podcast player. Now you can watch us on YouTube.

If you just search my name, Andrew Giancola, you will be able to find us on YouTube there. Now, today we're diving into nine ways to double your savings this month. And if you've ever felt like savings and investing is an uphill battle, you are not alone because so many Americans are living paycheck to paycheck right now.

I want to give you. Actionable tips of what you can do in order to grow your gap. Now, what is the gap? The gap is the difference between your income and your expenses. And when you have a gap there between your income and expenses, you can take those extra dollars that you have left over and you can put them towards wealth.

Building. Activities. And so this is why we want to go through this exercise is one. We want to make sure that we are spending our dollars on things that we truly value. And so figuring out what we value. Maybe it's vacations. Maybe it's fitness. Maybe it is doing more of the things that you love. Those are going to be things that we want to prioritize.

And then secondly, we also want to make sure that we are prioritizing our future. And so we want to be putting more dollars towards our future into retirement accounts, into real estate, into other investments. And so that is why we do this. We want to be buying back our freedom so that we can do more of the things that we value.

And this becomes an amazing cycle over time because the more freedom that you buy, the more you can do the things that you value and it starts to grow more. And more and more. Now, everybody listening to this podcast. I truly believe that each and every single one of you can become millionaires and that's what we want you to do.

And so doing some of these things, growing your savings every year is going to help you achieve that goal. And so I am ready to jump in this episodes without further ado. Let's get into it. Number one may sound obvious, but it's something a lot of people don't do, and from a psychology standpoint, it is so helpful, and this is to break your savings goals into small chunks.

So when we start to plan out how much we want to save, and you may get to a point in time where you're saying, well, I gotta figure out how much I need for retirement. And so you run through the calculation of doing the 25x rule. And so if you've never heard of us talk about that, basically, what you want to do is figure out, hey, What is my retirement number?

What number do I need to have invested in order to be able to retire? And so you're running this calculation. Let's say, for example, you need 80, 000 per year, and that'll cover all your living expenses throughout the year. Well, if it's 80, 000, you need 2 million invested. If you multiply 80, 000 by 25, and that's going to give you the quick and dirty back of the napkin math on.

What's your freedom number is it's really quick. It's really fast, but then you say to yourself, well, how much do I need to invest over time over the course of the next 30 years to be able to hit that? Maybe it's 10, 000, maybe it's 5, 000. It depends on what it is, but if these numbers sound daunting to you, if 10, 000 per year sounds daunting, then what I want you to do is I want you to break this out into small chunks.

Now there's a very specific reason on why we are doing this. So 10, 000 per year. If you broke that down per month, that'd be 833 per month saved. That'd be 192 per week saved. That'd be 27 per day saved. Now I want you to ask yourself this question because 10, 000 for some people, some people have saved and invest that on the show.

A lot of folks do who listen to the show. Some of you though, are just getting started. And we have a lot of people at the beginning of their journey. And you're saying to yourself, 10, 000, how would I ever save that amount of money in one year, but I want you to think through something. 27 per day. It feels like life these days cost 200 per day just to get by half the time.

And so when you go through this process, I want you to say to yourself. Do I waste 27 per day? Do I buy random Amazon things? Do I go to Walmart? Do I go into target and buy random things that I did not intend on purchasing when I walked in that store? If this is you, and if you think that you can find a couple of different smaller things that are going to add up over time.

Then I want you to be a little more conscious about this because breaking it down into small chunks. What it does is it makes your goals attainable. And that's what I want for each and every single one of you. Let's do it for 25, 000 per year. Let's say you are making a good income and you think that you can save 25, 000 per year, because you are just killing it.

Maybe you get a bonus at the end of the year. Maybe you just have a really high salary. Your living expenses are covered. And so your goal is to have a gap of 25, 000 per year, that's 2000. 83 per month. That's 480 per week, and that is 68 per day. And so this again is broken down to smaller chunks, but let's do a smaller number.

Let's say you want to say 5, 000 per year. That is only 417 per month. You know how many people overextend themselves on buying a car, for example, and their car payment is 800 when they should have just bought a car where their car payment was 400. And Save the difference. That'd be an additional 5, 000 per year that you could put towards investments and you're not just losing out when you do something like that on the 5, 000, you're also losing out on the opportunity cost of being able to invest this money and also the growth of that money as well.

The S and P 500 last year returned 25 percent to investors. And so you're not only losing out on that 5, 000, you're also losing out on whatever the potential growth was that 5, 000 is also 96 per week. Can you come up with an additional 96 per week? Or can you come up with an additional 14 per day? How many just frivolous purchases do you make that add up to 14 per day?

And this doesn't mean that you're spending at 14 every single day, but maybe, you know, once a week you go buy that 90 new pair of shoes. And the next week you go out and you overspend on a couple of different things that add up, you know, this is where it breaks down to break these small chunks up to make it easier.

So what I want you to do is I want you to figure out what your savings goal is this year and do this, maybe stretch yourself slightly, do it to where you're just slightly uncomfortable with that savings goal. Okay. Then I want you to break that savings goal down all the way down to small Chunks and when you break it down into small chunks, what you will find is that it is much more attainable than you once thought it was, especially if you're stretching yourself just a little bit, and I want you to tie it to everyday actions.

Can you cut out a certain thing every single week to help you attain that goal? Secondly, is you can use something like a savings challenge. So I am not big on like no spend months or things like that. I don't really think that's a healthy way to associate yourself with your money, but sometimes when you're just getting started, if you want to get a jumpstart and you want to be able to get that rolling, then maybe.

You do something like that. You do something where you spend less than a specific category, or you do a no spend month on eating out. And so you save all those extra dollars that you normally would spend on eating out. You can do things like that, but to do a no spend challenge for a month or two or three months.

Sure. You can go ahead and do that. It's just, I don't want you to associate money. With pain because it's not money can be something that is absolutely amazing and can get you the things that you value. And it is a tool that allows you to get to the next step. And so that's why I don't love those no spend challenges for most people.

And then automating the process is going to be partially what we talk about here later. So that is number one, number two. And this is a huge one is to get your savings buckets set up using. The bucket method. So we have an entire episode talking about the bucket method. If you have not heard that episode, I highly, highly recommended it was one of our most popular episodes last year.

And the bucket method is basically a way for you to set up and automate your So once you have this savings goal in place and you start to break it down into small chunks, what I want you to do is start to set up savings buckets. Now you may be saying to yourself, well, where do I put this savings? Great question.

So what I want you to do is if you are saving and in the emergency fund phase, we're going to be setting this up and putting it in a high yield. Savings account. If you don't know what an emergency fund is, all that is, it's a sum of money that you set up in case life throws monkey wrenches at you, meaning if life throws something in your way, like your car breaking down or you need to repair at your house or you need to get a brand new toilet because your toilet broke or you need to fix an electrical issue in your house or you need to pay for a bunch of tolls that you forgot about.

There's a whole long list of, you know, things that could happen in life. And when those things happen in life, you're going to have cash available and just there. And you know what is powerful about having cash just there and available because you set up a plan? What's powerful about that is that now you don't have to stress or worry when a problem arises.

I've talked about this before, but the first time I set up my emergency fund and had that cash in place and my car broke down and I had a 2, 500 repair with my car and I would not be able to drive my car anymore unless I got this 2, 500 repair. And I could not believe how amazing it felt to just have cash available to take care of it.

I just took care of it. The money was there. I did not have to worry. And that right there is one of the most powerful feelings that you can have with money, is being able to just pay for it in cash, not worrying about where the money is going to come from, not worrying about, Oh man, do I have to go backwards back into debt again to pay for this?

No, instead you have the cash just there. And once I saw this, this was one of the light bulb moments for me when it came to my money. Because once I saw how this actually really worked in the real world, all of a sudden everything came together. And so you gotta set up an emergency fund first. We have something called the 1 3 6 Method that talks you through how to set up your emergency fund.

You can go look that up as well. That was our most popular episode last year, was the 1 3 6 method. Uh, so make sure you set that up at your emergency fund. Bare minimum, I want you to have one months, then three months, then six months. I want you to build it up over time. What else goes in a high yield savings account?

Well, you can also set up stuff for your vacation fund for saving for a new car for a wedding fund for home renovations. Those types of things can also be saved into a high yield savings account. Now for investments, I want you to invest them obviously into a brokerage account. So this is going to go into something like Fidelity.

Or Vanguard or Charles Schwab. Those are the three that I would recommend wholly to most people. And so when you want to set up your brokerage account or your retirement accounts for long term, that's where you're going to automate your money into those brokerage accounts. And so let's think about this for a second.

Every single extra dollar that you want to put towards your financial future, I want you to put it towards investments or your emergency fund. And so as you're starting to build up your emergency fund, what you're going to do is you're going to build up the first month. Then you're going to pay off high interest debt, any debt above a 6 percent interest rate.

Then after that, you're going to go to three months of expenses saved in your high yield savings account. Once you have three months of expenses, then I want you to split it off into half goes towards investing, half goes towards your emergency fund until your emergency fund gets to six months. That's how I want you to think about this, and I want you to automate this entire process so that you personally are not relying on your willpower to put it in there.

And so the way that you can do this is like, for example, Ally Bank is a great example. Ally Bank, you can set up savings buckets inside of Ally that literally allows you to budget inside of that savings account. And so once you do this, you have these categories available that are going to allow you to automate your money towards the things that you want.

You'll have it all organized and it'll all be categorized in there. And it's in a high yield savings account. So it's earning you a couple percentage points in. Interest. And so this is a really powerful way to set up your savings. And then for your investing, you just automate money every single month into your investment accounts, and you can automatically invest it as well.

Fidelity has great tools, for example, on how to automatically invest. And we just did our investing for beginners webinar, teaching you how to open a Fidelity account and how to actually automate your investments in that account. If you're interested in that, you can go to master money. co slash investing for beginners.

So we have a webinar that we do live that will show you exactly how to do that. So our investing for beginners webinar teaches you exactly how that works. And so you have these dedicated buckets for your emergency fund, for your other savings goals, and you also have these dedicated money going towards your investment.

So I want you to get your savings bucket set up and utilize that bucket method. It is very important to set up your financial baseline and really get your money working. Let's jump to number three next. So number three is to audit your three biggest expenses. So most people focus on cutting small expenses, things like lattes, things like cutting back on your coffee.

And there was this thing that came out, you know, in the early 2000s called the latte factor. And what the latte factor stated was that, you know, if you go out and have a cup of coffee every single day, just like this, if you're watching on YouTube, I'm holding up my cup of coffee. That's going to cost you 5.

That latte will cost you five bucks. Now it's probably going to cost you 8, 9. And if you saved this money instead, you can have, you know, half a million to 750, 000 over the course of 30 years. Over the course of 40 years, you'd probably become, you know, closer to a millionaire just by saving that money over the course of maybe 40, 50 years.

And the latte factor is something that honestly, I don't really want you focusing on the small things like that, but sure, it would absolutely work. If you say 5 every single day, let's just do the math on that really quick. If you say 5 every single day, and you invested that money into something like the S and P 500 index fund, and let's say the S and P 500 got 10 percent rate of return.

Now we can argue about that all day long, but just go Google S and P 500 historic returns. Okay. So let's say we started at zero. And you got a 10 percent rate of return over the course of 50 years. You put it in an S& P 500 index fund and you contributed 150 per month. Okay, that'd be 5 per day over the course of 30 days.

All right, let's just calculate that really quick. It's amazing what really does happen here. This is absolutely amazing what you can do. So over the course of just 30 years in that account, you'd have 309, 000. That's not where it gets amazing though. Okay. That is amazing. 5 per day for 300, 000 over the course of 30 years, over the course of 40 years, you'd have 832, 000.

This is starting from zero. Okay. If you had 40 years time over the course of 50 years, though, this is where it becomes amazing. You'd have 2. 189 million. This, my friends, is the power of compound interest. Now, I want you to think about that because this is a very small thing. Lattes are a really, really small thing.

5 per day is a small number. Now, what if we actually shifted our focus from these lattes every single day and moved our focus to the big ticket items? What are your top three big ticket items that you spend money on? Now, some of you may think you know what the big three items are. And some of you, most likely, don't know what one of those big three items are.

So in the past, historically, I talk about the big three items for most people. What are they? They are housing, Which usually most people spend most of their money on their housing, their rent, all those types of things. Actually, in my budget, it is not, which is going to be something I'll talk about in a second.

Number two is transportation, meaning your car payments, your insurance payments. We just did an entire episode on how much you should be spending on a car, and it was very detailed. We also have a calculator that shows you how much you should be spending on a car in that episode as well. And then number three, is food.

And those are the big three items that I want you to think about. And I want you to really think through, is this one of my big three items? But for others, it may be something very different. If you are a parent with very young kids, one of the biggest ticket items in your line item, probably if you both work is daycare.

Daycare is a very expensive line item. For most people, the costs are continuously rising every single year. They have a bunch of teachers there. There's a lot of people they have to pay in a daycare facility. And so those costs continuously rise every single year. And so for you, it may be daycare for some, it may be restaurant spending for some, we may have a shopping problem and it may be shopping for some, your number one line item.

Maybe you have two cars or three cars. I've talked to people before who they really value cars. And so maybe their biggest line item is car parts or. Putting together cars or maybe your biggest line item is travel. It depends on the person, but for most people, housing, food, transportation are going to be the big three.

But if you're living a normal nine to five life, but it could be daycare as well, if you have young kids. And so if that is you, what I want you to do is I want you to audit your biggest three. Expenses. I want you to look at the last three months of expenses, figure out what your big three are. Now you can do this actually now in something like Monarch money, if you want to, or I'll do you one better.

If you want to find a free way to do this is you can go to chat GPT. And we're going to do an episode on a bunch of chat. GPT prompts are going to help you with your finances. So if you're interested in that, make sure you are following this podcast, but you can go to chat GPT. And you can do a prompt and upload your last three months of bank statements and just say, Hey, what are my three biggest line item expenses over the course of the last three months?

And you're going to have to adjust and be more specific on that prompt, but it will spit out. Your biggest three expenses for the month, and you can have an audit your financial statements every single year, but you gotta put in, you know, your bank statements and your credit card statements all at once.

So it can actually look at all your transactions. Okay, and it's very good at actually doing this. So it is something that you could utilize chat GPT. You can utilize any other AI feature, and there's some really cool stuff you could do with AI. Now, with your personal finances, we're gonna be talking about that in that episode.

Then what I want you to do is I want you to decide if you can make changes on this for your housing, for example, There's a couple of things you got to think through is a am I spending too much on housing? Am I spending over 30 percent of my income on housing? If you are, then you are spending too much on housing.

And so what we need to do is make adjustments so that we can reduce the amount that we are spending on housing to less than 30%. Okay, is you can look at transportation. Am I spending too much on transportation? Am I overextended on transportation? Am I spending more than 12 percent of my income on transportation?

If you are, Let's cut it back and let's look for ways to reduce those costs. What can we do? A, we can shop car insurance. B, we can see, hey, am I just paying too much on this car? Is this just too much car for what I need? Can we sell this car or move on from this car and get a more affordable option?

That's two. Three. Look at your daycare costs, look at your rent costs, look at all these different things and see if there's ways to reduce those expenses. Now the easy ones, or if you're someone who your biggest line item is eating out, well that's a very easy one to make adjustments on. You just reduce the frequency as to which you eat out.

Or if your biggest line item is travel. And you don't care that your biggest line item is travel. That's where you spend your dollars that bring you value, then more power to you. But if you care that you spend too much on travel, then you just travel a little less. So some of them are easier said than done.

Some are really easy to cut back on if you really want to. And so you got to look at what your biggest three are. And I want you to know what that is in the top of your head, because most people need to understand what their biggest three are. Mine, for example, is not housing. And for a lot of people, it is, but I spend about 15 percent of my income on housing in total is actually not one of my top three line items.

One of my biggest line items, for example, because I own a bunch of businesses is taxes. And so for me specifically, it is very, very important for me to spend a lot of time looking into ways to reduce my tax bill. And so that is something I need to know. If I don't know that, I would never know to hire the right people, to put them into place, to make sure we are getting efficiency when it comes to taxes.

Yours, if you're a business owner, maybe taxes. So you want you to think through some of this stuff because this is going to help you find money. And I want you to find money so you can take those extra dollars and put them towards things that you actually want this money to do your vacations spending it on things that you actually love and or putting it towards your financial freedom which is most of you what you want to prioritize most of you are listening to this podcast because you want to achieve financial independence and you want to do it early you want to do it as fast as you possibly can you want to do it early I want you to find money so that you can do that number four is if you have high interest debt And you have debt payments that are coming out of the wazoo.

And you just feel like all your money is going towards debt. Guess what? Houston, we got a problem that we're going to solve right here, right now. And that means that we are going to go and attack that debt. So every extra dollar that comes up after you get to one month of expenses in your emergency fund, I want you to take those extra dollars and we are going to get after this debt.

So any debt above a 6 percent interest rate, we want to get after. Now, this is going to exclude your mortgage because I don't want you spending 15 years trying to pay down your mortgage instead of investing. You are going to lose out on some amazing years of being able to grow your money. What we want to do is as mortgage rates start to begin to drop, then we want to just go ahead and refinance that mortgage later on.

But if you have something like a car loan that is 10%, if you have something like a personal loan, or the most popular is credit card debt. If you have any of those items. I want you to attack this debt with your extra money. Why? Because once this debt is paid off, you're going to have a lot of extra dollars that you can now put towards your freedom in the future.

And so we want to get rid of this debt as fast as we possibly can. Debt is the enemy of building wealth. It is the one thing that will. Cause you to go backwards if you do not take care of it, specifically high interest debt. Now, is there good debt? Is there bad debt? Sure. There absolutely is. You can utilize debt in order to further your businesses, or you can utilize debt in order to buy a rental property.

There are different things that if the debt produces income for you and it's enough income, the numbers make sense. There's a lot of factors, then there's good and bad debt. But for most people, when it comes to consumer debt, if you have credit card debt that needs to get paid off right now, that is a pants on fire emergency.

And it's amazing that I think a lot of people are now doing that. A lot of people who listen to this show are really attacking their debt. And it is so cool to see every single year at the end of the year. When you guys talk about how you paid off all this debt in a year or 18 months, it is so powerful to watch that.

Because now you've opened up opportunities for you to be able to do so many amazing things with your money, and I want you to thrive with your money. I want you to be stress free with your money. I want you to reduce your anxiety with money, and that's what we are working to do. And so list all your debts by interest rate and then also list them by balance.

If you have some with some small balances, let's just attack those first. Let's just get him out of the way. Let's get some quick wins. Let's get the ball rolling. Okay, once we get the ball rolling, then we can start to pay off some of these other debts in the future. Now, one other thing I want you to do is as you start to list all these debts, I want you to look at some of the interest rates, and if the interest rates are really high on some of these, I want you to start calling the credit companies and asking for a reduction in the interest rate, and it's their job to say no, it is not your job to think they're going to say no and not ask, okay?

Let me say that again. It is not your job to think they're going to say no, but not ask. Too many people in this world do not ask because they made up this story in their head that they're going to say no. Will they say no? I don't know. They might say no, but it's your job to find out if they will or not.

And so the only way to find out is to ask. And so I want you to try to negotiate some of those rates, maybe refinance. You can consolidate credit cards into a 0 percent interest loan for 18 months if you can figure something out like that, but it's got to make sense for you specifically and your attack plan.

Okay. So paying off high interest debt is a big one. Now we're going to jump into number five next. So number five is I want you to ask yourself some key spending questions. Okay? So there are some questions that we need to ask ourselves every single time we make a purchase, specifically when it comes to a big purchase, but it's going to align with a lot of even smaller purchases.

As you start to think through the way that you spend your dollars and who you give your dollars to, because we vote with our dollars with what we really want. That's the true indication of what we want in life. And maybe we just want some quick dopamine hits. And so we buy and spend on Amazon or we do these little quick things that are making us happy in the short run.

But in the long run, we forgot we even bought those specific things. And so if that's you, then let's start to ask ourselves some of these questions. Number one, this is the framework to determine what you actually value, okay? Because I want you to figure out what your values are. Spending is actually a skill and we want to spend our dollars on our values.

So number one, does this purchase align with my goals? Do I value travel? Do I value financial freedom? Do I value experiences over things? Does this purchase align with that? Number two, how often will I use this? I cannot tell you how many times I have purchased things and I purchased expensive things and said to myself, Oh, I'm going to use this thing all the time.

Here's a great example. I own some pickleball facilities. If you don't know this, uh, one of the businesses we bought is we bought a bunch of indoor pickleball facilities and one of the things that I did was I was like, you know, I want to get a little better at pickleball. I can't own these pickleball facilities if I'm not good at pickleball because I'm, you know, I'm not.

I'm like a 4. 0 player. If anybody knows pickleball, uh, which is just kind of like, you know, in the middle. So I bought this thing. It's a ball machine. If you want to look it up, It's a Titan ball machine, which is like a 2, 000 machine that shoots balls at you. Okay. So then I called up the company and said, Hey, I own all these facilities.

Can you give me a discount? They gave me a used one at a good discount. Uh, but still I spent a lot of money on it. Okay. I ended up spending, you know, something like 1, 200 on this ball machine. It's an amazing top of the line advanced, but it does all these cool things. It shoots the ball at you in different angles.

You literally don't have to move the machine. It does all these amazing things. And I said to myself, Oh, I'm going to use this all the time. First month, use it a lot. Second month, use it a lot. Then third month, my daughter was born and the reason why I got it, cause I wasn't going to play as much pickleball.

And so I could use this ball machine and get some time in whenever I want. I haven't used that thing in three months. And so I have this really expensive thing sitting in my house that I have not used in three months now. Right now, I'm telling myself as I'm telling you this, Oh, I'm going to start using it again a lot.

Do I know if that's actually going to happen? I don't know because if I don't put it in my calendar, it's not going to happen. Now, this is a huge example and I'm telling you this because how many of you have bought something like a treadmill when you could just go run outside and you bought a thousand dollar treadmill, never use it and you could just go run outside.

I want you to kind of consistently come up with the habit before you make big purchases like that. And so when you're asking yourself, how often will I use this? You prove it to yourself first, meaning that you go out and for 3456 months, you actually perform the habit over and over and over again. So if it is, you know, fitness related, then you do that fitness item over and over and over again for six months.

Then, you know, well, I got the habit in place. I'm gonna be using this item. That's one example. So if you're gonna buy a treadmill and you're gonna buy 1000 treadmill or 2000 peloton treadmill or something like that, Go ahead and start running outside four times a week. Prove to yourself that you have the habit before trying to make the habit by purchasing a new item.

If you're trying to make a habit by purchasing a new item, most likely you're not going to do it. I am incredibly guilty of this. And so that's something I think a lot of people need to think through. And then number three is, am I buying this for short term happiness? or long term fulfillment. Those are some of the questions that you need to ask yourself to figure out if you actually value something.

Now, here's the framework to decide if you need something right now. A. If it's not essential, wait 24 hours. If it's over 100, I want you to wait at least three days. And if it's above 200, I want you to wait a week. If it's above 500, I want you to wait 30 days to make sure that you really, really want that item.

And this is going to help you have a cooling off period to decide if you actually want that item or if it's just something that you really were thinking about a lot and you'd like to research the item. Some of us like the value of just researching purchases. There is actually some scientific studies that came out that people enjoy the process of researching purchases more than actually owning the item.

And so that is something you got to be conscious if that's you, if you're someone who loves researching stuff and just looking into it and dreaming about having the thing and going through all that process, you got to make sure that you know that. And so I think for a lot of people, let's try to develop some cooling off period rules with our spending so that we just don't make these big purchases that really do not bring value to our lives.

And so I want to think through that more and more as time goes on. All right. Number six is a big one. And for most of you, this isn't an action item you could do today is I want you to audit your recurring expenses and figure out how to negotiate your bills. So first, we're going to look through and I want you to take your bank statements and I want you to look at those if you use monarch money or if you use Any of those other budgeting apps, YNAB or whatever else.

If you use those apps, I want you to go and look at your recurring expenses. Most of the budgeting apps now will tell you, Hey, this is a recurring expense. Here's when it falls every single month. It is all automated, which is amazing. And automation is just going to get better and better when it comes to your spending.

And so I want you to look in whatever app you use and figure out what are my recurring expenses? All of them, every single expense that comes every single month. And I want you to look at those. Okay. Now, a couple of things that are going to happen here. Is you're going to see things like all of your subscriptions, which is a really important thing to look at.

You're going to see things like your cable bill. Things like your electric bill, maybe your mortgage or rent, maybe your utilities. All these different things are going to all be listed out. And I want you to think through which one of these can I negotiate with? Your cable bill, for example, is priority number one.

Number two is probably your cell phone bill. There is a bunch of different items. Your rent, if you have a landlord, can be one. There's a bunch of different items that I want you to start to identify a hit list. And I want you to go through that list. And we're going to start negotiating, baby. We're going to start to get on the phone, and we are going to put on our smiling faces, and we're going to start to negotiate a little bit.

Because you can find a lot of money by negotiation. I just gave this example recently. My internet and cable bill all of a sudden crept up to 240 per month. When I saw it, I probably picked up the phone faster than anybody has ever picked up the phone in their entire life. And I called the cable company.

And I said to them, Hey, my bill went up. I want to find a way to either reduce the cost of this bill. And or I'm going to go ahead and cancel right now. That's how I worded it literally. And so they came back and they said to me, well, let's see what we can do. They gave me one option and they brought it down from 240 to 160.

And I said, okay, that's not good enough. They looked at some other options. They brought it down from 160 to 140. And I said, okay, that's not good enough. Then they brought it down from 140 all the way down to 115. So right then and there, I just saved what? Right then and there, I saved 140 just by calling them up and going through the process.

140 every single month. And that's a really, really powerful thing to be able to do. You can do the same thing with your cell phone. If your cell phone gets out of hand, if they raise your rates on your cell phone without telling you, then start to call them up and have a conversation. You can leverage other companies.

You can start to have real negotiations with these people and save yourself a lot of money. And this is just going to be something that you could do. And every time you get a reduction in a bill, I want you to take whatever the difference is. And I want you to start putting it in your investment account and watch how this grows.

Because this is a huge difference. For example, my cable company example, that's well over, you know, 14, 1, 500 every single year. In addition, that you can start investing over time. 1, 500 every single year over the course of 50 years is 1. 7 million if you invest that money with a 10 percent rate of return.

It is 663, 000 over the course of 40 years and over the course of 30 years it's 246, 000. This is a 6 to 7 figure decision to just learn how to negotiate your bills and then take the difference and invest it. The second step, though, is you have to take the difference and invest it. Otherwise, it's going to get commingled in your checking account and you all know who you are because I am the same person and then it's just going to disappear every month.

So we've got to make sure that we are also reallocating this money when we save it. And so really, really, really important to do that. And then you've got to be polite, but firm when you start to have these conversations. But secondly, I want you to look at all your subscriptions. And I want you to figure out, what am I not using?

If there is a streaming subscription that you have not watched over the course of the last 30 days, get rid of it. Now, Amazon's different, obviously, because Amazon delivers packages also. They're all kind of baked in into one. But if there is one that you have not used over the course of the last 30 days, get rid of it.

You can always get it back. They are month to month contracts, but get rid of it. I do this all the time. So one thing I do is if I'm watching a specific show, I'll start to get rid of some of the other subscriptions. The only one that I typically would keep around is the ones that my kids will also watch on Netflix or Disney or whatever else, but if it's rotating between something like Paramount plus or HBO or any of those types of things, I will not keep those around every single month.

Why? Because you can't watch all of them every month. And so you got to have a rotation going, uh, and it's going to save you, you know, 50 every single month. Is it a pain in the butt? Not really. You just log in and say cancel. And so it's really an easy process that will take you two minutes. When you're doing your two minute drill every single day, just add that to your two minute drill, and it will help you kind of just stay on top of some of this stuff.

So list all your subscriptions. Go through that list and say, which one of these can I cancel? Which one of these can I negotiate is one. Which one of these can I cancel is two. All right. Number seven is to use your windfalls wisely. So those of you who get a raise every single year, or those of you out there who get a bonus every single year, or if those of you who work in sales and you get a really big sales check one month, or for those of you who work in commissions and you get a huge commission check all in one month, or for those of you out there.

Who have any other financial windfalls? Maybe you win the lottery. Maybe you get an inheritance. I don't know what your financial windfalls would be, but here's the rule for your windfalls. Okay, the 50 50 rule. Now, if it's something massive, like an inheritance, or if it's like something massive, like the lottery, all of it needs to go to investments.

Why do I say that? Because if it's a big number, the last thing you want to do is start spending that money on depreciating assets. What a lot of people do is the first, they'll go out and buy like a new car. I don't want you doing that. I want you taking the money and investing it and figuring out a financial plan for those dollars.

So if you get a big financial windfall, that's number one. But if you get raises, get big bonus checks, you get money coming in from commission checks, then I want you to follow this rule, the 50 50 rule. So above and beyond whatever your means are, when this money comes in, 50 percent goes towards future you.

Emergency fund investments. Those types of things. 50 percent goes towards the things that you want vacations. You want to buy a new TV. You want to spend more on things that you actually want to do day in and out. Maybe you want to raise the amount that you spend on eating out every month. Maybe you want to increase your efficiency in your house.

It doesn't matter what it is. 50 50 50 percent towards emergency fund and investments, 50 percent towards the things that you love. If you follow the 50 50 rule, uh, you will really make huge financial progress with your money. That's what a wealth builder does is they always give some to their future selves, and then they also take some money and they give some to their present self.

This is not about trying to struggle every single month. This is. All about managing your money wisely so that you can have balance. Balance is the name of the game when it comes to managing this. Now, if you want to retire in 10 years or less, maybe you're really trying to pursue financial independence, throw it all in investments if you don't care.

But if there's stuff that you want and you know that you want to live it up, you want to live your best life, then go ahead, take some of those dollars, put them towards things that you actually love. Number eight is if you are struggling to save and invest enough. I want you to follow the 1 percent rule, and its impact is really, really cool over the course of just a few years.

So the 1 percent rule is a very simple but powerful way to increase your savings without feeling the pain. The key here is I don't want you to have to feel the pain. And so we like to do things gradually when we increase our savings. And we also like to do it gradually when we decrease the amount that we're spending.

Everything is gradual with the way that we do it here. Okay. And so the way that we think about this is you can increase your savings rate. For example, by 1 percent every single month. Now, if you need to get to 20 percent savings rate, which is the minimum that we want you doing towards your investments and towards your emergency fund.

But if you need to get to that 20 percent number, then what I want you to do is start to increase it by 1 percent every single month over the course of the next 10 to 12 months. So if you're starting to say 10 percent right now, over the course of the next 10 months, start to increase that savings rate by 1%.

Now, obviously, if you can do more and you know you can do more because you're kind of going through some of these exercises, you cut out some subscriptions, you start to negotiate some of your bills, you found some money, hey, do all of it. But if you are trying to just get by, then let's start gradually increasing this and start to gradually decrease somewhere else.

Decrease 1%, then increase that 1 percent over time. And what is going to happen here is over the course of 10 months, now you're going to be saving and investing 20%. Now, how powerful is this? Let's say, for example, you make 5, 000 per month. That means it's only 50 in month one that you're increasing it, then 100 in month two.

So over the course of a year, you're going to save an additional 12%. And if you do that, if you made 5, 000 per month, you would save an additional 3, 900 extra by the end of one year. If you invest that at 10 percent annually over the course of 40 years, that extra would be 1. 95 million. dollars. Amazing, amazing what you can do with your money if you just make gradual changes over time.

And so following that 1 percent rule is a very, very powerful method that I really want you to think through. Number nine is every single person needs to know this. They need to understand this. And this is what I want you to take away from this episode. There's only three ways to save more. It is either cut expenses.

So eliminating unnecessary spending, lowering your bills through negotiation, and reducing lifestyle inflation, meaning reducing, you know, your lifestyle inflating every time you get a raise. Okay. That's number one is to cut expenses. And I want you to cut them gradually again, if you're going to cut them.

Number two, optimizing spending, meaning you start to optimize the way that you spending, you're spending your money. You can buy in bulk to save money. You can. Get cash back rewards on specific purchases, those types of things. Optimizing spending is probably the least likely to make a huge, huge impact.

So that's number two. Maybe you buy your car insurance six months ahead instead of paying month to month and you get a savings, those types of things. That's number two. Number three is to earn more. Now, earning more is going to be the single biggest factor that makes the biggest impact over time on your money.

And so if you can learn how to earn more by asking for a raise or making additional income with a side business or a side hustle, you will be in an amazing position. And so earning more will change your life if you learn how to do it. We have a bunch of episodes on how to earn more. We're going to have another episode coming up here.

So make sure you're following the podcast on ways that you can start to build side hustles that could turn into full time businesses. We had a bunch of those last year. People loved them. So we have more ideas coming up for you, which I'm really, really excited about. And so I want you to pick three of these strategies we talked about today.

And I want you to implement them and start to take action on it. Maybe it's automating your savings and debt payments. Maybe it is tracking your progress weekly. Maybe it is starting to negotiate your bills. Maybe it is cutting out some of those expenses that you know you don't really value. Maybe it's just going and doing a subscription audit.

All this stuff will have a major impact for you to be able to double your savings this month. And so I really want you to think through how you can do that so that you can get your dollars and start to really make massive financial progress. Listen, thank you guys so much for listening to this episode.

I hope you got value out of this. Our entire goal is to bring you as much value as possible. And thank you for investing in yourself because it's exactly what you do when you listen to the podcast is you are investing more in yourself. I hope you guys have a wonderful rest of your week and we will see ya.

On the next episode.