The Ways We Save 5

Looking at what's really, really important can be a huge motivator to find money to save. Here's Maria:

Our saving strategy is to aggressively pay off our mortgage so that I could take time off work to stay home with our children.  We opted for a mortgage with the option of increasing payments by 20% per year and making a 20% lump sum payment per year.  We've only been able to make a few lump sum payments and never the full 20% but we've always increased our bi-weekly payments by 20% per year.  We truly haven't felt the increase because it comes directly from our bank account.  I think of lot of people don't believe that doing this is possible but people waste so much money on truly needless things – eating out, spa treatments, shopping splurges, etc.  I enjoy these things but always within our budget.

We're literally saving thousands of dollars in interest by paying off our mortgage within 10 years instead of 25 years.

Our mortgage will be paid off by December 2011 and with this I will be able to take 5 years off of work to stay home and be with my children.  We are expecting our second baby in July and being able to take this time off without the burden of a mortgage or any consumer debt is the best decision we have ever made.

It's amazing how create people get when they want to find ways to save. While it might not be a strategy for everyone, Karen and her partner have saved on their fixed expenses so they have more for the things that are important:

My name is Karen, I live in very expensive Vancouver, BC with my partner Viktor. Over 7 years ago my partner and I rented a 5-bedroom house with another couple, after living together for a year, the other couple moved out.  My partner and I wanted to stay in house and couldn't afford the rent alone.  We decided to furnish 3 bedrooms and have roomies share the rent for a flat fee (including the often fought over toilet paper).  After 7.5 years, 40 + roomies, and over $150,000 in rent paid, we've managed to pay less than 30% of the rent from our own pockets – a savings of ~$100,000.  Granted, we paid some up front costs and up keep of furniture (all used & often given to us from friends), a second fridge, a freezer and laundry facilities which cost us ~$5,000.  Over 90% of the roomies were great and we never had huge issues with anyone who lived with us.   We used the money saved to give us both time to explore career opportunities, time for longer and more frequent vacations and increasing our savings.  Maybe one day we will buy our own home and continue with our money saving strategy.

Sometimes when you want to save for something specific it means you have to make more money. There can be some big side-benefits to a second job, as Danielle and her husband found out:

In order for us to save more money, especially when we were saving for our wedding, my husband took on a part-time job: mystery shopping! We came up with that particular strategy indirectly: in addition to my own full-time job, I began coaching figure skating part-time, so I couldn't make any more than I was. My husband mentioned we wanted to earn more money and put is joy for writing into use. I suggested mystery shopping, something I'd looked into when I was a student. Based on that one company that I'd suggested, he enrolled and found another 90 companies in North America and has now been paid by approximately 40 of them. It was nice that we was able to continue to earn some, although not as much, when he lost his job in the Dec 2008 economic crisis, maximizing his EI benefits.

Some of the jobs provide direct cash payments and we've used that to pay for items like his cell phone bill and gas as they are necessities of the job. But some of the jobs simply provide the benefit/item consumed and here are a few examples of what we've been able to do for free or getting a very big discount:

3 Toronto Raptors games
1 Toronto Maple Leafs game
concert at the Air Canada Centre
60% off stay at the King Edward Hotel in Toronto for our 5th anniversary (pre-wedding!)
return train ticket, Toronto to Montreal
gas and food while traveling throughout Ontario
50% off 1 night at a hotel in LA during our honeymoon
countless free dinners at a variety of restaurants
numerous free bowling outings
groceries, clothes, christmas gifts, etc

As the savings we've earned with this strategy aren't long-term oriented, we've been spending it as it comes in. In approximately 3 years of work, with just the cell phone ($50) and a conservative estimate of 1 gas refill per month ($50), we've been able to "save", i.e., apply $3600 towards are debt we'd otherwise not been able to. Thus an estimate of amount saved is difficult to discern.

So the savings we earned first allowed for us to pay for parts of our wedding, but mostly it has provided us with the luxury of going out-and-about, sometimes doing things we'd never pay for out of pocket (like the Raptors and Leafs games) while working extremely hard to pay off our debt (12 more months to go to being debt free forever)!

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