When you’re in the midst of budgeting, you might hit a point where you think there’s nothing left to trim from your budget. However, this plateau usually happens because we’re unwilling to compromise on our favorite vices or make genuine progress towards quitting our addictions, such as smoking, caffeine or even technology.
How to Save Money by Quitting Your Vices
If you’re ready to make some real progress with your financial goals, then here are some strategies for saving hundreds (or thousands) of dollars per year by quitting these vices.
We now live in an era when you can get booze delivered to your home within an hour or subscription boxes of craft beer and wine from around the world delivered to your doorstep every month. This has made it all the easier to satiate our drinking vices because we don’t have to worry about leaving the home and getting a DUI if we run out of alcohol. If you drink beer or wine on a daily basis, then you could be spending as much as $300 per month or more on your boozy vice, depending on the quality and quantity of alcohol you’re consuming.
In fact, the Bureau of Labor Statistics reported that the average American spends 1% of their income on alcohol. If you enjoy alcohol and make about $50,000 annually, then there’s a good chance you spend $500 per year on booze if you’re the “average American.”
This figure also includes bar tabs (multiple $10 cocktails every Friday night can really add up), as well as booze you purchase for social events. If you’re not a big drinker and want to save money on the next party you host, consider making it a BYOB event and provide food to your guests instead.
The average cost of cigarettes in the U.S. is $6.28 per pack. If you smoke just 5 cigarettes per day, this equates to $47 per month or $573 per year in potential cost savings. If you smoke 20 cigarettes per day, then you could be saving $188 per month or $2,292 per year if you manage to kick the habit.
Although vaping is generally viewed as a healthier and cost-effective alternative to smoking, studies have shown the average e-cigarette or vape user still spends $50-75 per month on their vaping vice. This could equate to $600+ per year in savings if you quit vaping altogether.
Do you need coffee every morning to survive the workday? Do you regularly consume energy drinks to stay up late? If so, then your caffeine vices could be costing you $60-100 per month on average (assuming you only consume caffeine once per day on weekdays). Granted, you could save a lot of money if you made your coffee or tea at home instead of buying it from Starbucks or a local coffee shop every morning before school or work.
But you could also save much more money by cutting back on caffeine and seeking out caffeine-free sources of energy, such as energizing music, increased water consumption, and physical activity.
Technology can be bad for your wallet, especially when it comes to addictive games with microtransaction payment models that really add up over time. For instance, that “free” gaming app you love may offer level-up bonuses or extra features if you just pay the “low” price of $0.99 for an upgrade. However, these games make money by offering countless upgrade options for a small fee (microtransaction), and you could be shelling out $50+ per month for games you love without realizing it.
The solution? Don’t pay for anything in any gaming app, ever. Set firm limits for yourself to avoid the temptation of swapping your real cash for in-game currency because it’s way too easy to get hooked when it seems so cheap (“just $0.99!”).
Another area of technological vices where you could save a lot of money is television. If you currently have cable, HBO, Hulu and Netflix, then you’re likely spending over $100 per month (not including the add-on specialty channels you pay extra for).
To avoid spending too much money on television, try to limit yourself to cable and one streaming service or cut out cable altogether and pay just $30 per month or so for multiple streaming services (Amazon Prime also includes its own free streaming service for members if you ever get bored of Netflix or Hulu).
There’s a big difference between investing and gambling: investments typically ebb and flow in value, while gambling is zero-sum (you win or you lose). Some gamblers liken their hobby to investors in the stock market, but as you can see, they’re completely unlike each other (unless you’re investing in something super risky, such as junk bonds).
Instead of throwing money away into a machine, at the racetrack, or on the poker table, why not divert that money into investments instead? If you diversify your portfolio with a mix of aggressive and conservative strategies, then you’re much more likely to “win” (get better returns) than a gambler who keeps pulling the lever all day, promising themselves they’ll stop once they recoup their losses (remember, gambling scenarios are always rigged in favor of the house).
You don’t have to completely quit your vices to start seeing the savings accumulate in the bank account. In some cases, exerting greater levels of self-control by cutting back on your vices to a much more moderate level can still lead to significant monetary savings without the suddenness of going cold turkey (which can lead to irritability or even relapse in some cases).
Whether this entails cutting back drinking to weekends at home only, smoking fewer cigarettes, brewing your own coffee instead of your daily Starbucks trip, or forgoing all microtransaction opportunities on “free” gaming apps, you can save quite a bit of money by gradually cutting back on your vices until you quit them altogether.