April, 2010
By Michael Kalscheur, CFP®
Senior Financial Consultant, Castle Wealth Advisors, LLC

Everyone is always looking for ideas on how to save money. There are dozens of books, hundreds of websites and thousands of articles talking about how you can save money by clipping coupons or reusing aluminum foil. Don’t get me wrong – those things are all good and useful, but how much can this really save you on a monthly basis? $20? $50?

What most people ask is “How can I save enough that it will make an impact? How can I save $500 or more a month?”

Unfortunately there is no silver bullet to save this much on a monthly basis, and all of the ideas outlined here will take time and determination to reach. In other words, don’t anticipate a quick fix.

However, if you are committed to make some adjustments to save what you can, the following are some suggestions on how to do just that:


If you are like most young people, your home is your biggest asset. However, it is probably your biggest expense as well. Between mortgage payments, property taxes, insurance, lawn and landscaping, routine maintenance and the like, the average homeowner is spending 40% - 50% of their take-home pay on their home. If you want to save money each month, this is the place to start.

  • Refinance the standard mortgage – if your rate is over 6%, refinancing could save you money.
  • Do your own maintenance – cut out lawn and landscaping professionals and you’ll not only save money, but get some exercise and a good tan to boot.
  • Upgrade vs. Upsize – instead of going from a starter home to the bigger home to your dream home, consider adding on or remodeling your current home.
  • Downsize if possible – paying for a big house that you don’t use isn’t a good use of your money.


Food is essential for everyone, but how much should you be spending on it? According to the USDA, the average family of four spends about $800 - $900 per month on food, not including dining out. Therefore, taking some thrifty measures could reduce this cost down by several hundred dollars per month.

  • Plan meals ahead of time – this not only saves frustration at dinner time, but you can buy everything with one trip to the store.
  • Make more than enough – leftovers make great lunches at the office the next day or a tide-me-over until dinner is ready.
  • Buy in bulk and when on sale – Costco and Sam’s Club can save you money, but watch for sales too.
  • Limit dining out “on the fly”– have snacks in the car if you know soccer practice runs over the dinner hour.
  • Plant a garden – with some time and patience you can turn $1 worth of seeds into 10x as much in vegetables.
  • Coupons can help, but compare to store brands – sometimes name brands are still more expensive than store brands or generics, even after the coupons.

Cut the (electric) cord

All of our gadgets and gizmos are fun to have but can also cost a pretty penny on a monthly basis. Look for ways to consolidate or eliminate some of these expenses.

  • Cell phones – if you have more than one plan or are paying extra each month for overages, change your plan.
  • Is a land line necessary? Between voice over IP, SKYPE, and OOMA consider dumping your land line.
  • Internet is OK, but satellite, cable and Netflix too? If you want to cut expenses, avoid the bundles and stick with the basics.


You need to get from point A to point B, but how much should it cost you? It is not surprising to hear that families with multiple vehicles can have auto expenses that exceed $1,000 per month. If you include normal maintenance and depreciation on those vehicles, the actual cost could be over $20,000 a year.

  • Shop your insurance – if you haven’t looked around in the last 2 years for new auto insurance, it’s time to make some calls and check online. You should shop your coverage with two to three companies at least every couple of years.
  • Buy used and save – new cars lose 10% - 25% of their value the first year and about 10% each year after. A three year old car may cost half as much as a brand new car, and will be cheaper to plate and insure.
  • Spend 20% - 25% of your income on your next car – this is a good rule of thumb that will keep you out of trouble with a car salesman pushing you into a car too big for your wallet.

Debt & your bank

I used to say there were only 3 kinds of “good” debt: a mortgage, a school loan and a loan to start / grow your business. Now I’d say the only “good” debt is having no debt at all. Remember that banks are in the business of lending money to people, so don’t take a loan just because your bank will lend it to you.

  • Shop around your mortgage – make sure that your home mortgage is at the lowest rate you can get.
  • Pay off car loans fast – the interest is not deductible. Once paid off, start saving that monthly payment.
  • Pay off credit cards even faster – interest rates are usually high, so make this priority #1.

Michael Kalscheur, CFP®, is a Senior Financial Consultant at Castle Wealth Advisors, LLC. Castle specializes in helping families and closely-held business owners with strategies to protect and transition family assets from one generation to the next. Castle’s senior partners also work with clients throughout the country in making logical decisions to help them fulfill their personal and business financial goals. For more information visit www.Castle3.com, call 1-888-849-9559 or contact Michael directly at .