17 tips to save money, from a woman who lived on $14,000 a year

Living a Beautiful Life on Less

Expenses can add up quickly
Danielle Wagasky, who stretched $14,000 a year to cover her family's needs for five years, would know.

Before becoming such a savvy saver, she dug herself into a financial hole when her husband was deployed to Iraq, leaving her in charge of the family finances. "I went shopping way too often," she writes in her book, "Living a Beautiful Life on Less." "I was constantly dipping into our savings to cover our checking account. I was late on bills and overdrafting like it was going out of style."

Little by little, she curbed her overspending habits, dug herself out of debt, and started documenting her frugal journey on blog, "Blissful and Domestic."

Here, we've rounded up tips and tricks from Wagasky's book and blog that she used to turn around her financial life:

Record every expense.

You have to know how much money is leaving your pocket.

"When we spend money, we put it into our spreadsheet," she writes. If you don't want to keep a spreadsheet on your computer, there are apps out there that will automatically track your expenses for you, such as Mint, You Need a Budget, and LearnVest.

Particularly if you're using cash for purchases, get in the habit of saving your receipts: "I save all my receipts, so I know what each purchase was made for and what category it goes into. If I didn't save my receipts, then I may forget why I spent $15 at the store."

Cut cable.

The average American household pays $64 a month for cable, which comes out to $768 a year. That's a large sum to pay for a service that people often don't take full advantage of.

"You do not need cable television to live," Wagasky assures. "With companies like Netflix and Hulu taking center stage, you can also pay less money and still watch all of your favorite shows. If you are paying for cable television, you're paying for hundreds of stations you never watch."

Look for ways to downsize.

"Downsizing applies to cars, homes, and overall lifestyle," Wagasky writes.

Do you really need a fancy sports car or gas-guzzling SUV to get you to and from work? As for homes, keep in mind that the bigger they are, the more expensive they are to run and maintain. And when it comes to downsizing your lifestyle, this could mean cutting back on dining out or shopping at expensive stores.

"Look at your life, the way you spend your money, and see where you can downsize," she says. "What can you cut down on or cut out completely to make the numbers crunch?"

Use a programmable thermostat.

"Leave that thermostat alone," Wagasky says.

The simplest way to keep your hands off (and consequently, cut your utility bills by $130 to $145 a year) is to invest in a programmable thermostat that allows you to adjust heat and cooling settings according to a pre-set schedule.

Other household hacks to save money each year include installing low-flow water faucets and shower heads, using blackout curtains in the summer to save on cooling, using LED bulbs instead of incandescent ones, and turning off electronics when you're not using them.

Avoid impulse purchases by putting them off for at least a day.

"When you see something you hadn't planned to buy and don't actually need, don't purchase it on the spot," Wagasky says. "Go home and think it over. If you decide it is something you would like to have, then add it to your budget and save for it.

"If you don't want to take the time to save for it, then you probably don't really need it. Just because something is on sale does not mean you need to buy it. It is not a good deal if you don't really need it."

Withdraw money exclusively from your bank's ATM.

Consumers these days pay an average of $4.35 each time they use an out-of-network ATM.

"We can all fall victim to bank fees if we are not careful," Wagasky writes. "I know that $5 may not seem like a lot, but over the course of 12 months, those $5 add up to $60. That is money you are just handing over to your bank."

The simplest way to avoid fees is to withdraw cash from your bank's ATM. If the machine doesn't have your bank's logo on it, don't use it.

Use the 'envelope system.'

If you tend to bust your budget, the envelope system could be your solution. Set aside predetermined amounts of cash and place it into labeled envelopes representing the various categories of your budget. For example, if you allocate $500 for groceries a month, put $500 in your "grocery envelope."

"When we use cash, we tend to think more about what we are spending it on, and we literally see that the envelope is getting thinner," Wagasky explains. "When you run out of cash in any particular envelope, the spending stops. You cannot spend money you don't have."

Make bigger and fewer trips to the grocery store.

The less time you spend in the grocery store, the less you'll spend, Wagasky preaches.

"Think about the last time you just went into the store for a few items," she writes. "Did you buy only those few items you were in need of, or did you spend a bit more? Did you impulse buy because of the lovely end cap display of goodies or because that deal was just too good to resist? It happens. Shopping less often takes away the temptation to do this."

Wagasky shops just once a month, but don't feel the need to instantaneously change your shopping habits. Start small, she encourages: "If you are a three-times-a-week shopper, try to go only once this week." Eventually, you can work your way down to once a month.

Buy less meat.

A simple way to trim your grocery bill is to buy less meat. "Try substituting beans and wheat berries for meat in your favorite recipes," Wagasky suggests. "Enchiladas, spaghetti, and casseroles taste just as good with the meat omitted."

If you have a harder time parting ways with your meat, start by establishing one meatless day a week. Eliminating meat just once or twice a week can make a significant difference in your grocery bill.

Stick to generic at the grocery store.

Go generic or store-brand whenever possible. It will save you money.

"There are some things my husband and I have learned truly taste the same as the name brand, while others can't compare," Wagasky writes. "The only way to know if you'll like a product is to try it."

Her pro-tip when shopping for generics: "Make sure to look up and down the shelves of food. Most grocery stores put the name brand items at eye level. They want that to be what the consumer focuses on. Generic brands are usually on the bottom shelf or the top shelf, so keep those eyes open."

Go homemade.

"Over the years, I have learned that the more we can make at home, the better off our grocery budget will be," Wagasky writes. "In our home, we try to make as much from scratch as possible."

One item she's saved significantly on by going homemade is bread, a staple in her household: "If I were to buy bread from the store, I would be paying over $3 per loaf. Thirty-six dollars a month is a hefty fee to pay for something I can make in minutes for one-third the cost."

Wagasky also chooses to make homemade granola bars and trail mix rather than spending on prepackaged snacks, which tend to be pricey and unhealthy.

Fill your wardrobe with the basics.

"When we are building a wardrobe, we want to make sure that we are filling it with things that we not only love but will also stand up to various fads," Wagasky writes. "I always encourage people to 'think classic.' Classic styles never fade or go out of season."

Invest in the basics first, she says. "Just like with food, if we keep our basics stocked, then we will save ourselves money in the long run because we can do so much more with the basics. When our wardrobe is made up of a lot of eccentric pieces, it becomes harder to make outfits out of them."

Shop around for insurance.

When was the last time you reevaluated your insurance plans to make sure it's working for your family's needs and budget?

"There is no need to be loyal to a company if it is hurting your budget," Wagasky writes. "If you can find another provider that will give you the same coverage for less money, then go for it. This is a simple way to cut costs and save a bit more each month."

She and her husband reevaluate their current insurance plans once a year.

Buy quality.

Sometimes it's not always worth it to get a "deal."

"Buy items for your family that will last and stand up to wear and tear," Wagasky writes. "Be conscious of all purchases. Whether you are buying thrifted items or brand-new items, think of each purchase as an investment. Make sure you get the most bang for your buck where quality and price are concerned."

Check out several everyday items to invest in that can pay for themselves in a short amount of time, such as a commuter bike or coffee maker.

Ditch the soda and alcohol when eating out.

If you're dining out, skip the soda and alcohol, which are a surefire way to bump up your dinner bill.

"Restaurants have a huge profit margin on these drinks," Wagasky writes. "Skip it and your wallet will thank you. Order water instead."

If you're looking to trim your bill even more, say no to appetizers and pick up a half-gallon of ice cream on the way home, rather than ordering an expensive single serving dessert at the restaurant.

Watch your miles.

"We only fill our tanks up no more than twice a month. We shoot for once a month," Wagasky writes. She and her husband combine errands when they go out, limit their across town trips, and make the most out of bigger trips to visit out-of-town family or friends.

"Trips for fun things that may take up a lot of gas are spaced out," she explains. "Moderation is the key. Really think about what you are using your gas on. Is it really worth it? Also check your tire pressure. When tires are filled correctly, you can make your tank go further for you."

Find pleasure in things that don't cost much — or anything.

The best savers find, and enjoy, the wealth of cheap and free activities out there, Wagasky says.

Start by taking advantage of the free attractions your city or town offers. Visit a state park and pack a picnic, head to a local museum, or rent bikes for the day and go for a family bike ride.

Need ideas for date night? Check out affordable Valentine's Day dates that can anyone can enjoy on days other than February 14.


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