Money Saving Tips

How to Save $500 This Month

How to Save $500 This Month
Written by Irina Vasilescu

With the holiday season nearing, every dollar that you can save will help a lot towards adding to your gift-giving budget. If not that, there could be some other thing that you are saving for. What if you can add $500 into your savings fund, no matter what you are setting aside the money for?

Here, we will take a look at what you can actually do if you have $500 saved up somewhere, and how you can set aside that amount of money in a span of one month.

Creative Ways to Save $500 This Month

First, let’s take a look at what you can actually do with $500. If you have a huge financial goal of buying a house, a car or if you need to replace a major appliance at home, $500 is a big enough contribution. Saving this amount per month will give you $6,000 – which will go a long way towards that home or car deposit.

If you’re planning to take a long, well-earned vacation from work, the same amount can go towards your spending money for the trip – or it can pay for a portion of your accommodations or airline tickets. You can use it to add to your retirement contributions or your kids’ college fund. If not that, why not use the money to build an emergency fund? Those who have debts can pay off all high-interest rate cards first to eliminate compound interest, and work towards building a solid nest egg.

If you have no immediate financial goals, you can use $500 as an initial investment to make your money grow. There are many paths that you can take for this. One is putting the money on DRIPS or DRPs, a Dividend Reinvestment Plan which gives investors the opportunity to buy stocks directly from companies even without the help of a broker.

As long as you can afford to buy at least one share, you can put your money on this investment and watch it grow. You can also invest in traditional individual stocks or mutual funds. You can even start your own business with $500. Starting a money-earning blog, offering dog-walking or dog-sitting services and advertising through flyers – there are many small businesses that you can begin even with very little capital.

Ways to Save $500 This Month

Based from the examples above, you can see how even a seemingly small amount goes a long way towards giving you financial security. If you would like to achieve your short-term and long-term financial goals, exactly how can you start saving $500 per month? Take a look at the following list:

If you’re paying for a car, determine if it is a need or a convenience

If you are fresh out of college, just secured a job and are still paying off those student loans, you might think that a car is something that you cannot live without. If you live in an area where it is highly inconvenient to take public transport, you might want to invest in a second hand vehicle first. But if you do live somewhere that you can easily take cabs, bus or train rides, a car loan payment might be something that you can remove from your monthly budget.

Even if you are paying for a car, there are ways for you to cut back on your car maintenance expenses.
When filling up the tank, for example, you can visit sites like GasBuddy.com which tells you which gas station offers the lowest rates. You can also cut back on the number of days that you are driving by joining a carpooling service. You can even plan to do all your errands in one day to save on gas. Expenses related to car maintenance takes up a huge chunk of your budget, so finding ways to save on it or eliminating it will save you a lot.

Slash those pricey monthly subscription fees

Financial experts recommend paying special attention to subscription services that automatically get renewed every month. Do you even remember signing up for that pricey gym membership plan when you gained a few extra pounds over the holidays last year? You might have used the facilities for a few months but totally forgot about it – and still not cancel the service.

The same thing holds true for organization memberships, charitable donations, audiobook/ newspaper/ magazine subscriptions, television or music services. If you can, ditch your landline and cable or satellite TV subscriptions and simply use similar services over the Internet. You can place calls online or watch premium cable TV shows through streaming services while paying just a fraction of the price.

Stop carrying a balance on your credit card

According to Consumerism Commentary, the average debt of a consumer is $2,200 and the annual interest charge for this is 15.2%. Even if you have a couple of thousand dollars saved up on a savings account, the interest rate that your credit card bills will accrue will simply negate any financial progress that you think you’re making. As such, it pays to pay the full amount of your debts first so that you would not have any interest or fees to add onto your expenses. After your debt is cleared, that’s the time that you can work towards giving your savings fund a boost.

Go for do-it-yourself treatments and at-home entertainment options

Just because you are trying to save $500 per month does not mean that you should give up on life’s little luxuries.

Women can have at-home spa sessions using natural ingredients which can be found in the kitchen for facial or hair treatments. Men can have friendly poker sessions at home instead of hitting the casinos.

Instead of eating at a restaurant, you can have a potluck dinner or outdoor barbecue at home. Ditch movie theatre tickets for DVD marathon nights right in the comfort of your home, and all you need is a cheap pack of microwaveable popcorn.

Trim your energy consumption

Heating and cooling costs make up 50% of your utility bills. By simply making sure that everything is sealed properly, you can prevent cooled or warmed air from escaping outside. The heating or cooling appliance works overtime if there are lots of areas where the air can seep through, so winter-proof your home prior to the winter month.

Phantom electricity is also another factor that adds to your consumption, which occurs when the electrical appliances are left on Standby Mode instead of completely turned off. Using a power strip will help you get rid of this. When replacing big or small appliances, make sure to choose an energy saving model.

There are plenty of other things that you can do at home to save on electricity, and make sure that all family members are doing it as well so you can boost your savings.

Go for generic and store brands

Don’t discount the generic and store brands when filling out prescription medication or buying body care, hair care or cosmetic products. An acne-formulated facial wash, for example, might cost double or triple if it is under a popular cosmetic brand.

However, a drugstore brand with the exact set of ingredients works just as well – and you don’t have to burn a hole in your pocket while buying it. The same thing applies for the other products that you are buying, always look for cheaper store brands or generic options.

Get the entire family to join in your saving campaign

If you have a big family and you are the only one who is in on the campaign to save money, your efforts might not amount to a total savings of $500 per month. But if you will get your spouse and the kids to join, you can all add to the piggy bank – virtual or otherwise – and reach your financial goals in no time.

Add to your income

If you’re having a hard time looking for areas of your monthly budget to trim, why not simply add to your income? Get a part-time job, start an online business, go freelancing – there are plenty of income-earning opportunities, no matter how small, that you can easily take on.

The good news is that these opportunities exist without the need for you to shell out anything on capital. If there is capital needed, it’s probably just to advertise your business locally so you need to spend on printing flyers. Otherwise, you can use the old-fashioned word-of-mouth advertising to spread the word about your business.

Other ways to save $500 in one month

Reviewing your insurance policies every month, using your spare change, ditching the fancy lattes for home-brewed coffee, using a refillable bottle instead of buying bottled water – when you add all these seemingly small efforts altogether, they will surely add up. In no time at all, you will find that you have saved around $500 in one month and you can use the funds to realize your long-term or short-term financial goals.

About the author

Irina Vasilescu

Irina Vasilescu is our crafty designer. She joined the team three years ago and is also involved in the writing process.

14 Comments

  • Thank you for again mentioning generic brands. I’ve finally convinced some of my friends to switch over the generic brands, but there are still a few that are convinced that more well-known brands are different, when the ingredients are clearly the same. Also, thank you for reminding me of a few subscription services I have forgotten to unsubscribe from. I’ll get right on it. Can’t believe I’ve been wasting so much money all these years.

    • To be fair, quality is sometimes an issue with generic versus name brand products. They’re usually comparable, but some name brand companies really do offer a better product that either does its job better or lasts longer than the generic competition. For instance, name brand paper towels actually are more absorbent and durable than their generic counterparts. Name brand TVs like Samsung and LG create far better picture quality compared to lesser manufacturers.

      • Typically knock off electronics will be inferior to the brand name stuff unless you can confirm that the internals being used are of similar quality. For other things though, like said cleaning supplies, you’ll rarely need to pay the huge markup for name brands because at the end of the day, a bottle of name brand bleach is going to be same bleach as your no-name brand. Just make sure the concentrations are the same.

      • I must agree with you. I am a frugal shopper and use coupons regularly. My last trip to the grocery store left me with having to buy a dish detergent that was not name brand because the coupon I had called for the purchase of two and in my rushing I did not see that and ended up purchasing a very lessor value. Well, I’ve had it about a week and use it daily, the suds are nowhere near the same as the other brand. When I use it to wash my hands, there are hardly any suds and when I rub my hands together for friction to wash, there is hardly any feeling of soapiness.
        I also agree with you on the paper towels. They are definitely different regarding absorbency.
        Regarding electronics, T.V.’s I don’t know, as long as it works, I guess it’s fine because it’s something that’s not going on my skin, I don’t have to worry about it not absorbing or ripping.

      • While this is certainly true, I think buying a TV isn’t really on the top list of things to purchase while you’re trying to save money. So most people would probably wait on buying a TV until they felt they could really afford one.

        Also, buying generic products like say paper towels, or whatever it might be, doesn’t have to be permanent. Just during the time of need so to speak. 🙂

  • Unfortunately, a lot of people don’t believe that they’re capable of earning a better income immediately. There are ways to negotiate a slight raise at work, unless you work an entry-level or hourly retail position. Individuals can pick up a second job or start working over the Internet in some capacity. It’s even possible to pick up extra work (and money) through Craigslist because people are always looking for help with something that they’re willing to pay for.

  • These are great tips and would help someone who is new to being frugal. Unfortunately, I’m already following every tip so there won’t be $500 worth of savings for me. Right now, I’m working on increasing income as that’s the only thing left to me at this point. As I add each little income stream, I’m funneling the cash directly into savings.

    • Always a smart idea. When you earn more money than before and you just waste the extra income, then you’re making a huge mistake. It’s important to boost your earnings and increase your savings at the same time in order to create financial stability for the years to come. Too many people fall into the trap of making more money and just wasting the excess on needless purchases.

      • Lifestyle inflating is so dangerous among the newly employed – this is first hand experience for me. After finishing school I became employed and started making a good salary. Of course, I went from being somewhat frugal to getting a better car, dressing better, eating out more, rented a larger and nicer condo. Before long I was wondering why I was always so broke and not really saving anything while still commanding a decent salary.

        Don’t get me wrong, reward yourself, but don’t let it become the new norm.

  • I can’t believe how many people will carry a balance on their credit cards. I have no idea why it would be a good idea if you have even a basic understanding of interest. The worst part is, it’s usually a fairly substantial sum that can’t be cleared within a short duration without putting them in to further debt from a secondary lending source.

    Rotating debt can be useful in some circumstances, but most people who are running several credit cards off of each other are NOT doing it right.

  • The tip about taking stock of your monthly subscription fees is SO true! There are so many times where I went to check my bank account and left afterwards saying “there should be a bit more in there.”
    After reading this article, I really scoured my bank statement for the past few months and realized that I had been spending a whopping 150$ on things I no longer use. I was spending all this money on a few magazines I no longer read, a membership for a gym I converted from, and several different online-streaming services.
    It just goes to show important attention to detail, and keeping regular watch over your finances are.

  • Hmm, after rereading this, I still see more ways to save. I definitely agree with finding ways to entertain the family at home instead of going out. There’s nothing wrong with Netflix or ondemand and popping some popcorn and snuggling in the family room. We do that often and the kids joke because usually my husband and I are asleep during the first five minutes of the move. It’s just more fun to be able to be comfortable. I already to certain spa services at home and go to the salon only on special occasions.

  • Great article, very good ideas here. I found cutting cable to be a huge saving. A lot of the stuff we watched you can find on youtube anyways. We just pay for Netflix now. Netflix, youtube and TV network sites all work for catching up on shows.

    I have never got why people are so picky there is nothing wrong with generic brands. Heck I even buy the no name brands of soups, crackers and other items and it taste fine.

  • That’s unfortunate, I already do almost all of those things! Not possible to save 500$ this month if I don’t pay this 500$ to begin with. I guess the only solution for me is to find some better paying sidejob than what I’m doing now and build from there. *sigh*

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