Over the course of a normal persons 40 year career there can be a lot of choices that will have huge long term affects. However, very few of us realize that these small changes can have long term savings benefits.
In my short career I’ve focused on a few of these areas to help compound my savings along the way.
Have a short commute – the average US commute today is about 16 miles one way (32 miles round trip). By having a short commute you can save money in a number of ways. First off, the most obvious way, is it’ll save ya money on gas. By shorting your commute by just 10 miles per day, then you’d save yourself about $12,000 over the course of your 40 year career. In addition to gas savings, you can save money on insurance too if you commute less than 7500 miles per year.
Don’t buy a gas guzzler – along with a long commute it doesn’t pay buy a big gas guzzling truck or car. If you switched from a 25mpg car to a 15mpg car, then it’d save you almost twice as much over the course of a 40 year career (assuming you’d have a 16 mile commute). The 25mpg car would cost you $38,400 and the 15mpg car would be $64,000! Again those small differences add up over an entire career.
Don’t take up smoking – either for a habit or a way to get out of work, it doesn’t pay to take up smoking. Assuming for a second that you smoke one packet per day and the price of cigarettes increased at 4% inflation, then smoking would cost you $173,000 over your 40 year career! Besides being bad for your health, it’s also bad for your pocket book too!
Take your lunch to work – is going out to lunch tradition in your office? We’ll this habit could be costing you dearly! If you eat out every day at lunch, spend $7/meal, and use the 4% inflation factor, then it’d cost you $166,000 over your career. I don’t know how some people go out to eat everyday for lunch and smoke! Those two expenses would cost you almost $340,000! Ouch.
Buildup your vacation bank – the amount of vacation that an employee can bank varies a lot. However, consider using your vacation bank as a way of saving your family money. Depending on how much you earn per hour and are allowed to bank will vary this savings amount. Regardless, consider using your vacation as an “office savings account” that will benefit you when you leave.
These are just a few ideas to increase your savings over your long career. I’m sure I’ve missed a few that others are using. We’d love to hear what money saving tips you are using at your jobs!