The Big Three Expenses: Reduce and Save Thousands

Change Your Biggest Expenses and Change Your Life

Reducing the Largest Expenses for the Greatest Impact 

The Big Three


Can you live closer to work? Or find a more affordable and flexible living situation?


Can you drive less? Or give up driving all together to use public transit or walk/bike?


Can you eat out less and make more meals at home?

The Case Study of Bill

To illustrate the power of big lifestyle changes on a person’s budget and their life I made a case study using my rental property in Austin, TX. Let’s take a look at how the decisions Bill makes in each spending category impact him.

Bill’s changes by category:

  • Housing. Bill found a shared living arrangement for $425 including utilities. He was willing to give up my privacy and some storage space in return for 50% off rent and no utility bills. He was paying $850 + utilities for a one bed. 
  • Transportation. Adding up Bill’s car payment, insurance, gas, maintenance, and DMV fees it cost him almost $5,000 to own a vehicle. He started driving less at first and tried out the public transit system and walked/biked to places close by. When he moved into the new rental he was able to commit fully to taking the bus due to living close to the major transit lines. His cost was $41.25 for a monthly pass or $11.25 to pay by the week.
  • Food. By eating out less Bill was able to save almost $750. It’s a healthier way to live for Bill and helps push him join the gym and walk or bike in the park on the weekends. Two things he’s been wanting to do for a while.
  • Misc Expenses. Bill changed phone providers, his healthcare plan, and canceled two subscriptions he was not using.

One decision to look for a new place to live led to many other compounding decisions in his life. Bill not only gained a significant financial boost he felt like he had more freedom too. He was able to live with less stuff because he only moved in with the items he uses regularly. He now has direction in his life and isn’t just working to get by. 

His next step is to get his employer to let him work from home. Then when it’s safe to do so he wants to move around the US and try living abroad. With his savings nearing $1,000 a month he can now afford to do so! 

Savings after making reductions in housing, transportation, food, and misc expenses.

Housing and transportation make up 50% or more of most people’s spending. Save thousands each year by reducing either of them!


# 1
largest expense
30 %
or more of income
65 %
own a home

Housing is a juggernaut, eating up 30, 40, even 50% of our income. It provides a place to eat, sleep, bathe, store our stuff, socialize, relax, and more. That’s a lot of value and for that reason housing will always be most people’s largest expense. 

Even though renting doesn’t build equity it can be more flexible and affordable with coliving.

Owning vs Renting

Looking at the chart there are pros and cons to owning and renting. 

  •  Ownership builds equity while renting doesn’t.
  • Taxes are paid by owners while they are passed on to renters.
  • Owners can have HOA dues while renters have to follow the rules of the HOA but don’t pay them directly.
  • Insurance provides different coverage but is common in both. Renters pay around $10 a month for a policy.
  •  Utilities are usually split or paid fully by renters. This can add up to 10-20% to the cost above the rent.
  • Coliving is unique in that it comes furnished, includes utilities, and offers shorter-term leases of 1-3 months.


# 2
largest expense
15 %
of income on average
85 %
own a car

If you’re located in an urban city try the bus or bike share program out. Both options are healthier for you and the environment and can save thousands a year.

Comparison of Transportation Options

Looking at the chart there are pros and cons of the three transportation options. 

  • Driving is much faster but also costs significantly more than taking a bus, biking, or walking. For example, a one mile drive to the grocery store can take 4 minutes to drive while a bus is 12 minutes and walking is 24 minutes. The bus is 3x slower, while walking is 6x. Bus times vary greatly depending on how long is spent waiting at the bus stop. Walking also can vary due to waits at traffic lights and crosswalks.
  • The bus can be a significant savings over a car costing $40-60 for a monthly pass in cities with bus service and $90-110 when a light rail or subway is an additional option. That’s less than the price of most car insurance plans and it offers unlimited rides and is hands free!


# 3
largest expense
10 %
of income on average
50 %
food at home and away from home

Benefits of Eating at Home

Eating at home can be a great way to cut back on expenses. Most meals out cost $5 to $10 plus the cost of driving or delivery. Choosing to reduce just one or two meals out per week can save $250-500 a year. Reducing meals out all together can save $1,000+ for most of us. 

If you’re unsure how to start cooking at home try starting with some staple foods. These include: pasta, potatoes, eggs, rice, and beans. There’s a lot of ways they can be paired together and the cost per meal should be $1-2.  

Action: Choose to eat at home more often. It’s better for your health and your wallet.

Misc Expenses

Negotiate Or Comparison Shop and Save Hundreds a Year 


Make sure you're paying the right amount for what you need and are using.


Make sure you're cell phone and internet are competitive.


Review subscriptions and cancel those that aren't being used often. Look at competitors for free trials or downgrade to free plan if offered.

Action: When renewing review plans for auto and health insurance, cell phone, internet, and subscriptions.