1. Eating Out
This is a big one. According to the USDA's Economic Research Service, in 2023, Americans spent 11.2% of their disposable income on food, the same as in 2022. Spending on food at home dropped to 5.3% from 5.6% in 2022, while spending on eating out rose to 5.9% from 5.6% the previous year.
Is going out to eat worth the added expense? Cutting back on restaurant meals could help you dramatically lower your spending in this category. When you do go out, there are ways you can watch what you spend your money on. Scan the menu for inexpensive options, order water instead of a pricey drink, and take leftovers home to get an extra meal out of the deal.
2. Alcohol
Do you enjoy happy hour get-togethers with coworkers or a glass of wine (or two) with dinner? You are in good company. According to LendingTree, in 2022, Americans spent an average of almost $600 on alcohol. Because many Americans drink rarely or not at all, those who spend money on alcohol may actually spend far more than this average.
Obviously, completely avoiding alcohol is a sure-fire way to stop spending money on it. But cutting back, buying what’s on sale, and inviting friends over for drinks rather than paying top dollar at a bar can help you spend less on alcohol without cutting it out entirely.
3. Coffee
More Americans than ever—almost two-thirds—drink a cup of coffee daily. But that caffeine boost does not come cheap: Research suggests Americans spend, on average, anywhere from $250 to $1,100 a year on coffee.
Here are some ideas on how to save money by reducing your coffee-related spending: Make it at home or at the office and avoid coffee drinks like lattes and blended coffee drinks, which cost much more than a regular old cup of joe.
4. Vacations
We all need a break every so often to unwind and recharge. For many of us that involves traveling. Americans spend an average of $2,843 on summer vacations, according to PR Newswire.
Taking a staycation and relaxing at home or exploring local attractions can save a lot of money. Other tips for how to save money while vacationing include comparing flight and hotel prices online to get the best deal, staying with friends, cooking your own meals on vacation, and looking up free or low-cost activities before you go.
5. Pets
We love our furry friends—and we love to spend money on them. It is reported that Americans spent $147 billion on our pets in 2023. But anyone whose cat has ever turned a shoebox into a bed or a shoelace into a toy knows that it is often the simplest, least expensive items that make pets the happiest.
So, take a picture of that cute dog outfit or funny-but-easily-destroyed toy and instead, give your pet what they want most—your love and attention. Put the money you would have spent on those items in a savings account to prepare for unexpected pet expenses, like vet bills.
