3 Ways to Downsize Your Life to Save Money, Time and Stress

Happy man
Photo by LumineImages / Shutterstock.com

Downsizing — what exactly does it mean? Smaller house, fewer bills, less stuff? Yes, yes and yes.

Many think of downsizing as moving to a more compact house after the kids have grown and gone. And it is. But let’s not stop there. Downsizing makes sense in other ways, too.

Following are other areas of life where downsizing can yield serious financial savings, not to mention save you time and stress.

What would you love to do with that money? Retire sooner? Retire richer?

1. Automate your finances

Downsize your recurring financial tasks — such as paying bills and setting aside savings — by automating them. You will also downsize your stress and save time and money.

For example, you can:

  • Put bills on auto-pay: Save money by making late fees a distant memory. Put a little effort into setting up automatic payments with your bank, credit card company and service providers. After that, you’re pretty much free from tending regular bills. Do set up reminders to periodically check on the accounts so a price hike in your phone bill doesn’t put your account in the red.
  • Cancel services you aren’t using: Save more money by canceling unwanted subscriptions and memberships. If this sounds like too much work, let a service like Trim take care of it for you.
  • Automate savings deposits: Your company’s human resources folks can explain whether you can have a percentage of your paycheck automatically sent to a high-interest savings account. Or, set up automatic transfers from your checking account to your savings.
  • Automate retirement contributions: If your employer has a workplace retirement plan, have money automatically diverted from your paycheck to your retirement account. If you have an individual retirement account (IRA), set up automatic transfers from your bank account to the IRA.

2. Downsize your home entertainment

Few recent technological advances offer such cheap fun as streaming entertainment. And as the number of streaming services and plan options continues to grow, so does the number of ways you can downsize your TV and video options — with little to no sacrifice.

For example, you can:

  • Slim down your cable TV package: Do you really need 200 channels? Would you even miss them all if you switched to a cheaper package?
  • Cut cable and stream instead: “Downsizing” from traditional pay-TV to streaming TV lets you cut out the high cost of cable without letting go of live TV. Among the much-cheaper alternatives are Sling TV, Hulu, Philo and CBS All Access. For details on these options, see “4 Ways to Cut TV Costs to $25 a Month — or Less.”
  • Get rid of TV: Just think of all the money and time you would free up.

For more no-cost options, check out our article on free movie streaming.

3. Downsize your transportation

Rethinking how you get around can make a powerful impact on your financial life. Car payments and upkeep suck up an oversized share of our budgets.

It costs an average of $9,282 per year to own and operate a new car, according to AAA.

What’s a “prudent” amount to spend on car payments? The experts at Edmunds.com recommend spending no more than 15% of your monthly take-home pay on car payments. If you lease, keep monthly payments at 10% or under, they add.

But, wait. There’s more: Fuel and insurance typically eat up another 7% of take-home pay. In total, you can expect to spend 22% of your income on a car, Edmunds.com says.

Ask yourself: Do you want to spend nearly one-quarter of take-home pay on your vehicle?

Instead, you can:

  • Ditch one car: If your household has more than one vehicle, get rid of one.
  • Stop using cars: Use a bicycle, walking, public transportation and ride-sharing services.
  • Use your car less often: Use other modes of transportation as often as you can. You’ll save on gas and wear and tear, and you might qualify for a car insurance discount.
  • Buy used: New vehicles can lose more than 20% of their value after just 12 months, says Carfax. In each of the following four years, they lose roughly another 10%.
  • Stop leasing: Pay off a car and then enjoy years without car payments.

If nothing else, at least “downsize” to a less expensive car insurance policy. This is easier than you might think. The best ways to quickly put a big dent in your car insurance costs include:

  • Shopping around: Comparison shop annually to get the best deal. This doesn’t have to mean calling around to insurers for quotes. Using an insurance search engine like The Zebra will take all the work out of comparison shopping.
  • Raising deductibles: “This is the simplest and fastest way to save on car insurance,” writes Money Talks News founder Stacy Johnson in “How to Get the Best Possible Deal on Car Insurance.”
  • Reducing coverage on older cars: For example, you should consider dropping comprehensive and collision coverage.

Marilyn Lewis and Karla Bowsher contributed to this post.

How to find cheaper car insurance in minutes

Getting a better deal on car insurance doesn't have to be hard. You can have The Zebra, an insurance comparison site compare quotes in just a few minutes and find you the best rates. Consumers save an average of $368 per year, according to the site, so if you're ready to secure your new rate, get started now.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Read Next
11 Expenses That Quietly Drain Your Wallet
11 Expenses That Quietly Drain Your Wallet

It’s scandalously easy to overspend in these areas of your life.

8 Common and Costly Homebuying Myths
8 Common and Costly Homebuying Myths

Think you’re ready to buy a house? Don’t fall victim to these rookie mistakes.

The 14 Most Deadly Car Models
The 14 Most Deadly Car Models

These vehicles are involved in fatal accidents at least twice as often as the average car.

Retirees Can Dodge Taxes on These 9 Types of Income
Retirees Can Dodge Taxes on These 9 Types of Income

There are lots of things Uncle Sam can’t touch — so long as you play by the rules.

4 Streaming TV Services That Cost $20 a Month — or Less
4 Streaming TV Services That Cost $20 a Month — or Less

Here’s how to ditch cable and satellite TV — and save a bundle — without giving up your favorite shows.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
This Gas Station Scam Is Victimizing More Drivers
This Gas Station Scam Is Victimizing More Drivers

For the second straight year, a growing number of Americans believe they’ve fallen prey to this scam.

This Is the Most Popular Age for Claiming Social Security
This Is the Most Popular Age for Claiming Social Security

Both men and women are most likely to start receiving Social Security benefits at this age.

7 Ways to Boost Your Credit Score Fast
7 Ways to Boost Your Credit Score Fast

Your financial security might soon depend upon the strength of your credit score.

Could You Give Up These 7 Expenses to Save Thousands of Dollars a Year?
Could You Give Up These 7 Expenses to Save Thousands of Dollars a Year?

You could save more than $30,000 by setting aside these costly expenses for just one year.

6 Things You Should Never Buy at Trader Joe’s
6 Things You Should Never Buy at Trader Joe’s

We love Trader Joe’s for plenty of reasons. But think twice about this handful of products.

6 Legal Documents Retirees Need — but Don’t Have
6 Legal Documents Retirees Need — but Don’t Have

Few retirees have these documents that are crucial to their golden years — especially during a pandemic.

Don’t Toss These 7 Household Items — Sell Them
Don’t Toss These 7 Household Items — Sell Them

Here’s how to earn cash as you give new life to these unwanted items.

7 Unusual Ways to Declutter Your Home
7 Unusual Ways to Declutter Your Home

Tired of possessions weighing you down? Here are seven ways to declutter painlessly and effectively.

19 High-Paying Jobs You Can Get With a 2-Year Degree
19 High-Paying Jobs You Can Get With a 2-Year Degree

These jobs pay more than the typical job in the U.S. — and no bachelor’s degree is required.

The 15 Worst States for Retirees in 2020
The 15 Worst States for Retirees in 2020

Based on dozens of metrics tied to affordability, quality of life and health care, these are not ideal places to spend retirement.

9 Dumb Ways You Are Ruining Your Home Value
9 Dumb Ways You Are Ruining Your Home Value

Homeowners, beware these mistakes that can drive away potential buyers.

5 Ways Joe Biden Wants Social Security to Change
5 Ways Joe Biden Wants Social Security to Change

Here’s where Biden — as well as Trump — stands on the future of the Social Security retirement system.

3 Ways to Get Microsoft Office for Free
3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

7 Tips for Building an Emergency Stockpile
7 Tips for Building an Emergency Stockpile

A pandemic or natural disaster could leave you reliant on your existing food supply. Is your pantry prepared?

21 Things You Should Always Buy at a Dollar Store
21 Things You Should Always Buy at a Dollar Store

Dollar stores have great bargains on both everyday and occasional purchases.

15 Outrageously Overpriced Products — and How to Save on Them
15 Outrageously Overpriced Products — and How to Save on Them

Retailers mark up products by hundreds of times their cost — but you don’t have to pay the premium.

18 Amazon Purchases That We Are Loving Right Now
18 Amazon Purchases That We Are Loving Right Now

These practical products make everyday life a little easier.

Why Half of Retirees Now Owe Taxes on Social Security
Why Half of Retirees Now Owe Taxes on Social Security

Growing numbers of seniors are paying taxes on their Social Security benefits, but you might be able to avoid this fate.

11 Disgusting Household Items You Should Toss Already
11 Disgusting Household Items You Should Toss Already

Never keep these items past their prime.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.