14 Ways to Trim Spending and Save for a Large Purchase

There it is, glinting on the horizon: the goal. See it sparkle in the distance? You can reach that pot of gold with proper planning. While true for most any goal, planning is especially important for financial targets like saving for a large purchase. A little planning can help you trim spending and save for a large purchase more easily.

What’s your savings goal? Are you saving for a real estate down payment? A snazzy flat screen? A wedding? Make a visual reminder of what you’re working for. Hold an image representing your goal in your mind. Reconfirm your commitment to attaining this goal. Consider printing out a small picture that represents your goal and display it where you’ll notice it regularly, or set an image of your goal as your phone’s wallpaper. 

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Buying something on credit can be significantly more expensive than paying cash when you figure in the cost of borrowing the money for the purchase. Interest rates can be high and late payments can impact your credit score. Owing money on a purchase can impact its emotional worth.

Many people find that saving the money beforehand is a more efficient strategy for making a large purchase. Here’s a few sound tips that can help you along the way.

Getting started
  1. Estimate how much money you will need to meet your goal. Although prices may vary over time for any specific item, you should be able to make a good estimate based on comparable items today.
  2. Determine how much time you have until you need the savings. One year? Five years? The more time you give yourself to reach your objective, the easier each step will seem.
  3. Create a schedule for adding to your savings fund and calculate an amount to contribute each period. The best time to set aside money is when you receive it. Create a savings schedule that lines up with when you receive your paychecks. 
  4. Establish a separate savings account for this goal. This will help you keep the funds for your goal separate, and you'll be able to clearly see how quickly you are approaching your goal. If you can, automate the process (so that deposits are routinely made automatically).
  5. Include the savings amount in your budget with all other regular financial obligations. Treat your savings effort the same way you treat your utilities and other bills -- as a regularly scheduled commitment.

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Finding the money to save

Reaching a major goal calls for a disciplined savings habit, which is highly likely to involve disciplined spending habits to back it up. Keep in mind that items you pay for out of pocket can add up to a great deal more than you might realize. Consider economizing on these expenses:

  1. Take-out coffee and soft drinks can cost several dollars each. Eliminating one such purchase per day could give you $10 to $20 a week for your savings goal.
  2. Buying lunch at work could cost $15 per day or more. Bringing your lunch could potentially free $75 a week or more for your savings. Bringing your lunch is also better for your health and your habits.
  3. Entertainment costs for movies, night clubs and sporting events can add up. Skipping even a few such expenses each month could save you $100 or more for your large purchase. If you’re a foodie, consider checking out cookbooks from the library and having people over for dinner rather than taking someone out to eat as a treat. Maybe you could have a revolving “host” night among your circle of friends.
  4. Commuting costs can be made more manageable with some planning. Gasoline, tolls and parking fees can far exceed the price of commuter passes or mass transit fares, creating a significant savings opportunity. Research your pre-tax options with your HR manager at work. If mass transit is not an option, consider carpooling: Two people sharing one ride to work can cut their commuting costs in half. And if you’re a regular Lyft or Uber user, take a gander at your bank account; these short rides can really add up. Consider alternatives like walking or the bus.
  5. Cable or pay TV subscriptions may cost more than your telephone service. You may find that you can reduce the number of options in your service to give you more money to redirect to your savings goal. Consider your streaming options. How many subscriptions do you watch? Perhaps you can trim a few.

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Taking a tighter rein on spending
  1. Write down all of your outlays to clearly see where you are spending money each month.
  2. Pay down credit card debt and revolving loans, which are typically the most expensive forms of credit. Unless you are paying more than the minimum each month, you may never pay those debts off and could face never-ending interest expenses.
  3. Compare rates on credit cards, homeowners insurance and automobile insurance since prices for these can vary widely, creating new opportunities for savings. Here’s more on insurance.
  4. Celebrate your milestones. If you’ve trimmed your spending for several weeks in a row, congratulate yourself with a frugal treat that carries meaning for you. This can be as simple as checking out a new digital book from the library, taking a hike with an old friend, or taking some “me” time to unwind. It might be helpful to make a list of frugal treats, so you’ll have options to choose from once you reach (and pass) more milestones.


Hopefully these tips will help you reach your goal with confidence and accuracy. Your work will pay off with a little planning and a lot of commitment!


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This article is adapted from material via the Financial Planning Association®.

Topics: Saving, Budgeting and Debt Management