Make These 7 Small Financial Changes Now for Big Returns This Year

easy ways to save money

It’s the start of a new year, and you’re ready to make some changes. But where to start? Dive right into big money goals and you could get overwhelmed and quit. Move too slowly and you may delay worthwhile changes.

Fortunately, even small changes can have major, positive impacts on your money. These seven easy ways to save money are low-investment but have significant returns. Take these steps to improve your budget now, and reap the benefits throughout the coming year.

1. Cut a big recurring expense

For your regular monthly living costs, any opportunity to save is one that can pay back again and again as the expense recurs. Taking the time to figure out how to downsize one (or more) of your bills is a smart idea to learn how to save money every month.

Take a look at your recurring expenses and see where you can trim. For example, I’ve had success negotiating with my internet service provider. I originally signed on for a promotional rate that was set to expire after a year. Once my bill went up, I asked for a similar deal and was able to keep my lower price.

Try calling your service provider to negotiate your price. You can also shop around for another provider with better prices and deals. Or, if it’s a service you’re not getting value from, such as an unused gym membership, consider canceling it altogether.

2. Refinance or consolidate your debt

Refinancing or consolidating debts can be one of the easy ways to save money, making debts cheaper and more affordable. Whether you’re facing student loans, a too-high credit card balance, or even a car loan, spend some time looking around for opportunities to save.

The best student loan refinancers, for example, offer rates that start below 3%. If you have a high student loan rate, a big balance, or a lengthy repayment ahead of you, refinancing student loans to a lower rate has the potential for savings.

For credit card debt or other loans with higher interest rates, refinancing or consolidating through a personal loan could get you a lower interest rate. Spend some time looking at your options and calculating your refinancing savings to see if this could be a worthwhile move.

3. Fine-tune your retirement portfolio

The beginning of a new year is the perfect time to check up on your retirement accounts. This will give you the chance to make adjustments and ensure that your investments are growing the way they should be.

Your financial situation today is likely different than it was when you chose your holdings — you may have a higher income or bigger responsibilities. Look at your portfolio with new eyes to see if you’re getting the returns you want at the level of risk you can tolerate.

You should also check the costs of your investment accounts to ensure your returns aren’t getting eaten up by transaction fees or advisory charges.

Lastly, consider upping your contributions to your account. Even putting in one percent more can greatly improve your retirement outlook, while having only a minor effect on today’s budget.

4. Ask for a raise

The start of the year is often a time for performance reviews and evaluations. Whether you recently had a review or are preparing for one, this provides an ideal window to negotiate your compensation.

For the best chances of success, do some research and come prepared with a well-reasoned ask. If you want a salary bump, research comparable pay in your area and collect examples of how you contributed to the company’s bottom line.

Maybe you’re interested in other benefits, like student loan payment matching. Come prepared with the research that shows how this could make you a more productive and valuable employee.

It can be intimidating to ask for a raise, but it’s an important investment in yourself. With a 30-minute conversation, you have the potential to increase your income for the rest of the year — and throughout your career.

5. Plan your spending and saving for the year

It only takes an hour or two, but setting up an annual budget can go a long way in putting you in control of your cash. It helps you be proactive in your money decisions, instead of reacting as you muddle through whatever life throws at your finances.

Make a budget, but not just a monthly one. Include other purchases you hope to make this year, from a birthday bash to a family vacation or even a new car. Anticipating these expenses will give you time to properly save and pay with cash, avoiding debt and the extra costs that come with it.

Looking at your year-long budget will also help you identify the easiest ways to save money. You can see how much extra you’ll have each month. Set up systems to put this money where it matters, instead of leaving it at the mercy of your checking account each month.

6. Check on your credit

When was the last time you saw a copy of your credit reports? If it’s been a while, it’s time to request a free annual credit report and review it. You can also use free online tools to view an estimate of your credit score.

As you check up on your credit, you can get an idea of how healthy your borrowing habits are. With just an hour of your time, you’ll know where your credit stands and how you can improve it.

Better credit can mean access to other valuable opportunities, from low-cost mortgages or loans to a better apartment — meaning you’ll continue to save money with good credit.

7. Boost your personal finance knowledge

Read a personal finance book. Subscribe to a podcast about money management. Enroll in the Student Loan Hero newsletter to get money tips to your inbox. There are plenty of sources of smart, effective money advice.

If you start taking advantage of these (often free) resources, you’ll grow your financial knowledge. You’ll be equipped to make wiser financial moves, from your everyday spending up to the biggest purchases in life, like a home. With these small investments of your time and attention, you’ll get a guaranteed return of improved financial knowledge and capabilities.

Wherever your finances stand right now, improving them can start with simple, easy ways to save money. None of these actions take more than a few hours, but each has the potential for big payoffs.

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