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17 Money-Saving Tips for Families on a Budget

If you’ve got the sinking feeling things are getting more expensive, you’re not alone.

In May 2021, the Bureau of Labor Statistics reported that the Consumer Price Index for All Urban Consumers (representing about 93% of the population) increased 5% over the past 12 months, the highest increase since 2008.

And according to CNN Business, prices for food, transportation, and household furnishings are on the rise as of June 2021.

Supply chain disruptions during the COVID-19 pandemic combined with increased demand for certain goods as more and more people get vaccinated contributed to a notable jump in prices. Mixed with a higher-than-usual unemployment rate, the higher cost of living might have you and your family scrambling for ways to reduce your expenses.

Whether you’re dealing with job loss, stagnant wages, or simply want to save money, there are things you can do to cut your costs and make your family life a little more budget-friendly.

Money-Saving Tips for Families

If you want to save more money, it can help to take a wide-angle look at your family finances and examine your spending habits up close.

Adopting more frugal practices and finding ways to cut back on your most significant expenses, such as housing and child care, means you have extra money to save in an emergency fund, for retirement, or for your children’s education.

1. Make a Family Budget Together

Saving money doesn’t just mean you end up with more in your checking account and savings account. It also gives you a chance to teach your kids valuable personal finance lessons.

One way to help your kids develop financial literacy and know-how is to make budgeting a family affair. Every month or so, sit down as a family and talk about your expenses, income, and savings. You can also talk about debit and credit card use at the meeting.

More important, use the meeting as a time to make a budget for family spending. For example, you can show your kids what’s in the family bank account and talk about the expenses coming up for the month.

You can also work with your kids to help them make a personal budget and set savings goals.

For example, maybe one of your kids wants to save up for the latest video game system or hopes to buy a birthday present for a friend. Teaching them how to budget and the value of being frugal helps instill positive lifelong money habits.

Pro tip: If you don’t have a budget set up, get started with Tiller. They’ll automatically pull all of your monthly transactions into a Google Sheet or Excel document so you can see where your money is going each month.

2. Trim Your Family’s Grocery Bill

In May 2021, the United States Department of Agriculture (USDA) estimated the average family of four with two kids under age 5 spent between $599 and $1,169 per month on food at home.

Families with two kids between the ages of 6 and 11 spent between $687.40 and $1370.10 per month on food at home.

Depending on how much you spend at the grocery store each month, there might be significant room for savings. Some of the ways you can trim your spending on food include:

  • Making a Shopping List. A shopping list saves money by helping you avoid buying products you don’t need. The simplest way is to track consumables as you use them. Keep a magnetic notepad on the fridge and jot down what you need as you run out. If you’ve got an Apple HomePod or Amazon Echo device, you can also create shopping lists by voice command.
  • Reading Sales Flyers. Review each store’s flyer and match what’s on sale with what’s on your list or plan meals around sale items. Or you can download Flipp to see sales flyers and make grocery lists by tapping to add sale items on the flyer to your list. It’s sometimes more cost-effective to visit multiple stores in one week to get the lowest prices possible.
  • Using a Cash-Back App. Install a receipt-scanning app such as Fetch Rewards or Ibotta on your smartphone to take advantage of cash-back offers from grocery and discount stores. After grocery shopping, scan your receipts, and the app applies any special offers to your account.
  • Starting to Meal-Plan. Meal planning is deciding what you’ll eat for all or most meals for the week so you always have food ready to go. It helps you avoid last-minute fast-food runs, maximize your purchases (so you waste and spend less), and even eat healthier on a budget.
  • Avoiding Grocery Shopping When Hungry or Stressed. Hunger and stress can make you do strange things, like buying lots of chocolate or gimmicky processed foods. Plan to go to the store when you’re well-fed and relaxed. That way, you can stick to your list and not overspend on food you don’t need.
  • Trying a Pantry Challenge. Part of saving money on groceries is making sure your family consumes everything you purchase. Every month or so, hold a pantry challenge during which you use up as many pantry goods as possible before you shop again. A pantry challenge cuts down on waste and lets you get a sense of how much you’re overbuying.
  • Reducing Waste. A 2020 study published in the Nutrition Journal found that the average American spends $1,300 on wasted food each year. Adopting better grocery shopping habits is one way to cut back on wasted food and money. Make a list of everything you throw out without using, such as spoiled leftovers or soggy lettuce, to get a sense of the full scale of the issue.

3. Never Pay Full Price on Products and Services

There’s always a deal to be had if you can wait to buy. So whether you need to purchase new school clothes for your children or a new coffee maker for the kitchen, it pays to shop around.

Apps like Capital One Shopping can even direct you to the stores with great prices.

But you can also do research on your own and keep tabs on the prices of things you frequently buy, such as groceries, using a price book.

It’s even easier when shopping online. Type the brand and product description, such as “Conair hair dryer,” into Google to see what pops up. The shopping feature (in the navigation at the top of the search page) lists retailers selling the same product and the prices each one charges. The thing you want to buy could be available for less at a competing store.

Free browser extensions like Honey, Capital One Shopping, and Rakuten can also let you know if there’s a coupon or better price on something you’re browsing online.

Capital One Shopping compensates us when you get the Capital One Shopping extension using the links we provided.

4. Cut Back on Subscriptions

Netflix, Disney+, HBO, Spotify, Audible, OwlCrate: It’s easy to let the number of subscriptions and subscription boxes your family has multiply. While one or two subscription services won’t break the bank, costs start to add up as you add more.

Have a family meeting and talk about your subscriptions. Do you really need to subscribe to every streaming service? Are you using Spotify enough to justify the paid version, or can you survive with the ad-supported free one? Do you need that monthly book club, or can you head to the library once per month instead?

5. Negotiate With Your Service Providers

When’s the last time you looked at your cable, Internet, or cellphone bill? If it’s been a while since you signed up for service, there are probably more affordable options out there.

You could get a better deal by calling your service provider and asking if they have any discounts available. Or you could try switching providers to save money.

Also consider whether you’re making full use of the features and services you’re paying for. If you have a lot of streaming subscriptions, do you need to pay for cable TV? Does your family need the fastest Internet speed available, or would you survive on something a bit slower (and cheaper)?

The same is true of your cellphone bill. If you’re paying for unlimited data, review your statement to see how much data you really use.

It could be a lot less than you think, especially if you have access to Wi-Fi or usually go online with a computer. If you aren’t using lots of data monthly, switch to a lower-priced plan that limits your data use.

Pro tip: If you don’t have the time to call each of your service providers, there are several bill negotiating services available that will do all the work for you.

6. Save Energy at Home

Trimming your utility bills is another way to boost your budget and save money.

Some energy-saving options, such as installing new plumbing fixtures or upgrading your HVAC system, cost a lot upfront. But there are also plenty of low-cost or free ways to lower your family’s energy use.

Some energy-saving habits to teach your family include:

  • Turning Off the Water. Teach your kids to turn off the water when they’re brushing their teeth or washing dishes rather than letting it run. You can make it easy for them to remember by putting little stickers on the wall or mirrors near the sinks.
  • Switching Off Lights and Devices. Another way to lower energy costs is to turn things off when no one’s using them. For example, turn off lights and televisions when they’re not in use. Put little notes by light switches to remind your kids (and adults) to flip the switch as they leave a room.
  • Adjusting the Thermostat. Teach your children the value of putting on a sweater when it’s cold out and wearing shorts and T-shirts when it’s warm. You can also set thermostat rules to ensure no one turns it up or down too much. A smart thermostat learns your family’s habits and can start to adjust itself, saving you money on bills. You can also program the thermostat to save even more. You can find models for less than $100.

7. Buy Reusable Goods

Buying products you can reuse repeatedly isn’t just good for your family’s budget. It’s also good for the planet.

For example, buying Stasher bags can help you cut back on or eliminate the use of single-use zip-close plastic bags. The bags cost more than a box of plastic baggies upfront, but you only need to buy them once.

Other reusable products that can help you cut down on single-use plastic and throw-away products include:

In some cases, you don’t even have to purchase reusable goods. For example, empty jam and salsa jars make convenient leftover storage, drinking glasses, or vases.

8. Go Thrifting

There’s so much stuff already out there that there’s very little need to buy anything brand new. That’s good news for your family budget, as purchases at thrift stores or secondhand stores tend to cost a lot less than new merchandise.

To save money on kids clothing and shoes, buying secondhand just makes sense. It’s likely your 4-year-old will outgrow a pricey pair of brand-new sneakers before the second wear, so why pay full price?

Clothes and shoes aren’t the only things it makes sense to buy secondhand. You can easily find things like books, kitchen gear, toys, furniture, and tools in good condition for less if you buy used.

If you’re looking for something specific and don’t want to spend hours digging through local thrift stores or consignment shops, you can try online shopping. For example, eBay is a good source for pretty much anything, while Amazon is a safe bet for used books, movies and TV, and music.

Also, your family’s unwanted belongings can earn you extra cash. For example, take your kids’ clothing to a consignment store when they outgrow them or hold a yard sale to sell clothing and household goods you no longer need.

9. Hold a Swap

If you’ve got kids, you probably know other families with children. And those families are likely looking to start saving money too. You can all make your saving efforts a little more community-focused by holding a clothing or stuff swap.

The rules of a swap are simple. Nothing is for sale, and everyone has to bring something. They can take home what they need.

You can focus the swap on kids’ items only, such as back-to-school supplies or toys. Or you can open it up and let parents swap stuff they want too, such as adult clothing, kitchen and dining necessities, and home decor.

10. Get Stuff for Free

If you can’t find enough people to hold a swap, another way to get what you need while saving a ton of money is to join a local free group or buy-nothing group.

You can post what you need to the group, and if someone has it, they can let you know. Or if you have things you want to give away, you can share details about those with the group, and someone who needs them can take them off your hands.

Along with joining a free group, you can usually find people giving away free stuff on Nextdoor, Freecycle, or Facebook Marketplace.

11. Get Deals on Gifts

Shopping immediately after the holidays is one of the smartest ways to save money on holiday gifts for the upcoming year. And that doesn’t just apply to winter gift-giving holidays. Do the same for celebrations like Mother’s Day, Father’s Day, and birthdays.

While you don’t have to go to extremes, it can make sense to start planning and budgeting for holiday spending early in the year. Make gift lists and keep an eye out for presents on the list throughout the year so you can buy when they’re on sale or available at their lowest price.

You can use an app like Capital One Shopping or CamelCamelCamel to track prices or find the best deal.

12. Save on Parties and Celebrations

Along with planning for gifts, it also helps to set a budget to avoid overspending on decorations, holiday-related incidentals, and party costs. You can go the DIY route when it comes to decorations to help cut costs and give your family’s holiday and birthday decor a more personal touch.

You can also think one-size-fits-all when it comes to decor. A reusable red tablecloth can dress the picnic table at a Fourth of July party, a spooky black-and-red-themed Halloween gathering, and a festive family Christmas dinner. White dinnerware works at holiday parties all year.

Another way to keep party costs down is to hold potluck celebrations. You can provide the main course but ask guests to bring sides, appetizers, and desserts. Or you can slash your costs by asking people to bring their own drinks.

If you’re hosting a kids birthday party, save money by visiting the dollar store for party favors, serving snacks instead of a full meal, and holding the party at home instead of at an entertainment center.

13. Take Advantage of Free Entertainment

The best things in life are free, and it can be surprising how many low-cost or free entertainment options and activities are available near you.

Instead of spending money on trips to the zoo or amusement parks, spend the day with your family relaxing in a local park. You can hike on nature trails or pack a picnic and kick back on the grass.

Many municipal parks offer free outdoor movie screenings during the summer months. You can check out recent popular films without paying for movie tickets or a rental. Just bring some chairs or a blanket, a few snacks, and enjoy a free film under the stars.

14. Visit Your Library

Instead of buying your kids books and movies, take them to the local library every week. They can check out books, DVDs, and CDs to enjoy, all without you spending a dime.

Many libraries also offer free programming and services. Check to see if yours has a storytime after school or if it offers other fun or free activities, such as crafting classes and homework help.

15. Make It a Staycation

The kids have a few days off from school, and you have a few vacation days available. It can be tempting to book a fancy family trip. But you can also enjoy a vacation in your hometown, known as a “staycation.”

What you do on your staycation depends on your budget. It can be something free and easy, such as spending a few days catching up on Disney movies or having a family board game weekend.

You can also set up a tent in the backyard and go camping. If you want to get away from the house for a few days, book a campsite at a state or national park.

Another option is to swap houses with a family nearby. You get to live in someone else’s home for a few days while they stay in yours. If you choose a local home, you don’t have to shell out for airfare or spend a lot on gas or tolls. You can list your home on HomeExchange to find others willing to swap.

16. Right-Size Your Home

The standard recommendation is to spend no more than 30% of your gross income on housing each month, as CNBC reports. But many people are putting more than 50% of their income toward housing, a 2020 report from the Joint Center of Housing Studies at Harvard University found.

If your family’s housing bill is higher than you’d like, you have options. One is to “right-size,” which is a more positive spin on downsizing. When you right-size, you get a home that works for your family but is likely smaller and cheaper than the one you live in now.

You have a few things to consider when right-sizing. One is the number of bedrooms you need. Ask yourself whether your kids really need their own rooms or can comfortably share one. If you live in an area with lots of local parks and recreational areas, ask yourself if you need a large private backyard.

Another way to right-size is to reconsider your transportation methods.

If you want to cut costs, cut out one or more vehicles. If you’re in a walkable area or an area that’s well-served by public transportation, you can easily become a one-car (or even no-car) household. You’ll save on gas, parking costs, insurance, and maintenance costs. So ask yourself if you can live without a car.

17. Sign Up for a Rewards Credit Card

Rewards credit cards give you cash back on purchases, offer points for gift cards, or let you erase purchases with the points you earn.

The type of card you need depends on where you shop most and where you most want to save.

For example, if grocery spending is one of the larger line items in your budget, the Blue Cash Preferred card from American Express gives you 6% back on the first $6,000 when you shop at supermarkets, then 1% back on subsequent purchases.

It also gives you 3% back at gas stations. If you spend $6,000 at grocery stores and pay with your AmEx, you’ll get $360 back each year. Read our Blue Cash Preferred card review for more details.

If you’re just looking to save money in general, the Chase Freedom Flex card gives you 5% back on a rotating category each quarter (up to $1,500). You don’t get much notice about what the featured categories will be. But you can take a look at the previous featured categories for each quarter to get an idea.

For example, the second quarter of 2021’s featured category was gas stations and home improvement stores, with the third quarter listed as grocery stores and select streaming services.

Plus, you get 3% on dining purchases and 1% back on everything else. If you spend $1,500 in the appropriate category each quarter, you get $360 per year. Read our Chase Freedom Flex card review for more information.

But those are just examples. Check out other credit cards to see what works best for you. To get a head start on research, check out our articles on the best:

Final Word

If you aren’t sure where to start when it comes to saving money and becoming a frugal family, take baby steps. Start with one money-saving tip and do that for one month. When you’ve got the hang of it, add another. Keep going until you’ve incorporated all the tips that work for you.

To motivate yourself, think about how you can use the money you save. You can save up a down payment for a home, pay off debts, start saving for your kids’ college education, or just increase your family’s financial stability.

Amy Freeman is a freelance writer living in Philadelphia, PA. Her interest in personal finance and budgeting began when she was earning an MFA in theater, living in one of the most expensive cities in the country (Brooklyn, NY) on a student's budget. You can read more of her work on her website, Amy E. Freeman.

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