[00:01] habits they don't even realize are costing them tens of thousands of I'm going to walk you through five categories of spend and show you ways further in each. That way you can literally double how far your money
[00:15] it's housing. So housing is one of these categories where you're probably going to spend the majority of your monthly recurring expenses on. Everyone needs a place to live and the cost of renting and the cost of mortgages these days is
[00:27] you can do to get more value out of housing and it doesn't involve just moving to a cheaper place. The first principle I'd focus on is getting more means picking neighborhoods that might offer great perks. So perhaps there's a
[00:39] park nearby, a library, or an outdoor gym, or maybe just has a high on neighborhoods at the American Enterprise Institute, quote, "People who live in proximity to neighborhood amenities are happier, more socially
[00:53] others compared to those who live in low amenity areas." Amenities here could be in reference to anything like a park, a library, a grocery store, a gym, a bar, a restaurant, etc. And being close to these amenities actually translates to a
[01:07] dollar amount. The article goes on to state that in a study of nearly 100,000 home sales, walkability was linked to higher home values in 13 of 15 US metro areas. And that quote, "A nationwide analysis in 2018 found a walkability
[01:21] premium in property values which was equal to an additional $28,000 on a $200,000 home." The second way you can stretch your dollar out further based on your commute time. Now, according to this Inc. article, adding just 20
[01:35] minutes of your commute makes you as miserable as getting a 19% pay cut. That minutes instead of 20 minutes to get to your job and you earn $100,000 per year, it could equate to $19,000 worth of pay. Quote, "The study found commuters who
[01:49] walk or bike to work don't report the same dissatisfaction with their leisure train." All right, so there's a lot to unpack there. I do agree that I think commuting by walking or biking just is a lot better than say sitting in
[02:02] if your walk is really pleasant, like you're walking through beautiful your city that gives you inspiration, that could actually bring you sense of commuting, like sitting on trains or sitting in traffic, I do think
[02:15] that it can cost you a dollar amount of happiness. You can argue with me whether it's actually worth 19% of your salary or not. The number is somewhat commuting can have a cost on your overall satisfaction. I had an
[02:27] internship in college, for example, that paid me $18 per hour and I remember having to commute an hour and 20 minutes each way to this internship and I just didn't really have any other job options, so I just kind of stuck it out.
[02:41] However, these days, if you were to ask me to commute an extra 20 minutes or 30 minutes just to get somewhere on a daily basis, I would definitely factor that into any decision I have to make regarding a potential job or housing.
[02:53] further in the housing category is to design your space to feel premium and that could mean lighting, layout, or maybe just decluttering your place. Sometimes I am surprised at how bad my friends' layouts are in their own homes.
[03:06] So if you're able to optimize your furniture to create better overall flow or maybe just remove one piece of oversized furniture, it could make your functional. One tip I have for you here is that you can take a picture of your
[03:19] current layout, upload it to ChatGPT, and just ask it to optimize it for you. actually come up with some great tips on how you can maximize the square footage thoughtful- ness around housing, you can definitely use the space that you have
[03:32] and the area that you have to maximize your satisfaction and the value per dollar spent. The next biggest category people tend to spend a lot of money on take a look at this chart from AAA from their report on how much it really costs
[03:45] average cost for five top-selling models in each category. So if you're someone average you are going to be spending $1.10 per mile in the form of depreciation plus fuel plus financing costs and insurance and maintenance.
[04:00] for, let's say, a small sedan or a hybrid or even a subcompact SUV, you are literally saving 40 to 45% on every single mile that you drive. You want to maintenance costs plus high reliability scores. So I would probably think of
[04:16] Honda Civic. If you want a link to this and then that way you can see all the full breakdowns of every single type of in the automobile category is to at
[04:28] insurance providers. According to a 2019 study, Americans are overpaying for insurance by nearly $37 billion per year and that study was conducted six years ago. I'd have to imagine that these days that figure has probably ballooned quite
[04:42] Americans are overpaying for auto insurance by an average of $330. quotes with other insurance providers. Also make sure that you're not already do have. Now, when it comes to buying a new car versus a used car, I
[04:57] depreciation curve of whatever you're trying to buy. For example, if you were to Google, let's say, a Maserati's depreciation curve, you might find that it is one of the worst culprits out there. $100,000 spent on a 2014 Maserati
[05:11] Quattroporte was worth less than $45,000 after four years of use and that is some crazy depreciation. So take some time to study car depreciation curves. Different cars are going to have different curves, but if you are buying a car, the sweet
[05:25] spot to buy a car is somewhere in the three to five-year used range. That's chipped away already, but the car is still new enough so that it's not exactly a problem car that you're going to have to spend a ton of money on
[05:37] when it comes to cars, I think it makes a lot of sense to buy a car that has, let's say, around 30,000 miles and that's about three years used. In that lot of money on your total cost of ownership, and just have a pretty new
[05:50] car. When you combine all these tactics and also with better choices around what you buy when it comes to transportation, I think that it can help you save a lot next category is food. So the average American household spends approximately
[06:03] $9,985 per year on food as of the latest data. That breaks down to around $832 per month, which is further broken out by month, which is further broken out by $504 on groceries per month and $328 on
[06:16] food out of the household. Food is a really expensive expense and we all need to be some ways you can save a lot of money on your food expenses. The first sounds really simple, but many people just don't plan their meals ahead of
[06:30] grocery store, hopefully you're not going to the grocery store number one worst things that you can do, but also you want to have somewhat of a plan to throughout the week. If you're able to go to a grocery store on a Sunday night,
[06:43] I'm going to eat this, Tuesday I'm going to eat this, Wednesday, Thursday, Friday you have some idea of how much money in total that all your meals are going to to find yourself in is that when you don't have anything planned at all for
[06:57] meals and you don't have any more food left in the fridge, you're going to go just DoorDash, I don't know, this Mediterranean food for $35." Planning ahead here will help you reduce these impulsive food purchases and these
[07:11] comes to the amount of money that you're spending on food, you want to look at all the types of food that you are buying and see what takes up the bulk you are noticing that you are spending a lot of money on nice cuts of meat like
[07:24] filet mignons or perhaps you're eating a lot of shrimp, maybe you want to switch comparable protein like chicken, which is a lot cheaper, arguably healthier, and still gets you to those protein goals. Often times, protein will be the
[07:37] buy. So it's important to look at what you are buying and seeing if there are any substitutes. Of course, you could also go vegetarian or vegan, but I'm not saying look at what is costing you a lot of money within your food bill and see
[07:51] with brand names. So I like to go with generic brands over brand names and I find that usually generic brands can help you save close to 50% on whatever you are buying. Often times they will taste pretty similar and I even prefer
[08:03] some generic brands over brand names. Lastly, the one place where I feel like people spend a ton of money is when they do go out to eat. People like to get a Perhaps if you've been sitting at home for the last six days of the week, that
[08:16] one night you go out to dinner, you say to yourself, "Man, well I really deserve disciplined all week. I'm going to go treat myself." So what ends up happening is you order three cocktails, a few appetizers, some entrees, as well as a
[08:28] big dessert, and two hours later you've basically sabotaged your entire week's dinner. Not only in terms of caloric content, but also financially. I'm not little bit, but you want to consider some ways to cut costs before you go out
[08:42] have a beer at home instead of having three cocktails at dinner, which are with your expenses and I think that will help a lot when it comes to the food category. Now, the next category that I think you can save a lot of money in and
[08:56] further is entertainment. This is one of my favorite categories to talk about types of entertainment and each type of entertainment will have a different cost associated with it. For example, if you really enjoy attending Formula 1 events,
[09:10] than say, if you enjoy playing League of Legends for free online on a Friday they weren't watching the mini map and they get killed out of a silly mistake. find it fun. Another category of entertainment that's gone really
[09:25] expensive in the past few years has been movies and concerts. You can see that adjusted, the inflation for these types of entertainment have gone way up in recent years. This is pretty evidenced by any concert you want to go to these
[09:37] days. I used to remember that I could spend $50 on a concert and these days a premium artist like Ed Sheeran, for example, he might be $175 for nosebleeds and $450 for a ticket on the floor. So I have a few tips for you here in the
[09:52] make sure you are distinguishing between experiences and expenses because I think actually going to be really cheap or they are free. Hiking, game nights with friends, exploring your own city, or maybe even reading books from your local
[10:07] inexpensive. I also think that as long as you're with some friends that you enjoy, generally I find that I have a better time. So, there's actually a countries, people who often spend time with their friends report to be happier
[10:20] their friends. Go figure. The second thing I would think about is the cost if you're going to be spending, let's say, $50 on League of Legends skins, but it's going to give you 100 hours of entertainment, that equals about 50
[10:34] cents per hour. Versus if you go to a Taylor Swift concert for $1,000, that's $333 per hour that you are spending to be at that concert. I don't think either understanding the value per hour that you are spending, at least when it comes
[10:48] make better and more intentional some hobbies that actually pay you back in the future. So, for example, if you making things and then you can eventually sell them. Or perhaps you
[11:02] invest $500 to $1,000 in cooking classes and then therefore you can even save life because you know how to cook really well. These are just examples of things you can do for entertainment, but also can make you money or save you money way
[11:15] you can stretch your dollar out a bit further are subscriptions. Americans spend over $200 on unused subscriptions every single year. The average millennial spends about $1,200 in subscriptions every year as well, which
[11:28] great way to stretch your dollar out further in this category, but what this category is more about is figuring out how you can cut subscriptions without reducing your overall quality of life. The first exercise I offer to you is to
[11:41] pull up your credit card statements and count every single recurring charge. I have two or three subscriptions that you forgot that you were even paying for. Since the average person now has 12 subscriptions or more, that's just a lot
[11:54] actively thinking about canceling the ones that you don't use. The framework about a subscription is the following. So, take the amount that you are spending on it every single month and think to yourself, does my use of this
[12:07] subscription justify the monthly cost? Every subscription should justify itself value, and if not, I think you should these things and that's the funny thing I think people often forget that they
[12:21] can cancel and resubscribe anytime. They just are pretty lazy about it. All of these tactics in today's video. I would love to hear from you and also share as well. If you enjoyed this video and your time with me, check out this
[12:34] video right here on the 10 things that I stopped buying. In that video, I tell you all about the 10 things that I just can't pay for anymore on my own. I'll see you guys in that video or a future one on this channel. Thank you for being
[12:46] here again and I hope you have a happy holidays. Peace.