How I Increased My Savings By Over $10,000

One of my goals for 2017 was to have a savings rate of 55%. Considering the average person in America saves a measly 5.7% of their salary—or $5.70 for every $100 in after-tax income they make—it is fair to say that I am setting myself up for success.

I have written numerous times about the importance of having a high savings rate. If this topic was not so important I would not keep writing about it several times a year. It does not matter how high your income is, it matters how much you save. This is the ONLY way wealth is generated, unless you are fortunate enough to have a large inheritance.

Today I want to share some ways I am saving over 55% of my salary which will allow me to reach my goal of $24,000 in investments by the end of the year.


As an international working in the U.S., I do not have the luxury of living at home with my parents. While many millennials are realizing that living at home with their parents is highly beneficial due to the enormous student loans we are required to take out for education these days, I am stuck with paying rent.

Rent is arguably one of the biggest expenses on anybody’s budget. For me, rent accounts for roughly 20% of my after-tax income. Luckily, this amount is a fairly low percentage as I live with a roommate. Should I have lived on my own, my rent would be roughly $500 higher before I add in the cost of paying for utilities.

Having a roommate increased my savings rate by roughly 13% and added an additional $6,000 into my bank account!


Food is one of those budget items that people can easily blow in a month. When I lived in college I found myself buying food almost every day despite my house having a well-equipped kitchen. This habit came more out of laziness than anything else and it cost me hundreds in food expense on a monthly basis.

Ever since I began working and cracked down on my spending habits, food has been one of the hardest items to cut back on. I personally love eating a good meal, but what I have found is that you can cook a restaurant quality meal at home for half the price. Not to mention the quality of the food may also be better!

One of my roommate and I’s best purchases for our apartment was a slow cooker. That thing is simply amazing! I usually toss some meat in it overnight with the appropriate seasoning and when I wake up my food is ready to go.

By cooking my own food I have reduced my monthly food budget from almost $400 a month to $200 a month. This increased my savings rate by roughly 5% or $2,400 a year!


Entertainment is a very vague category. It can involve going to the bars, eating out or even a vacation. Just like food, this is a category that destroys your savings rate if you do not carefully monitor it.

Some of the best ways to cut cost in this category are to find free actives around you to go to. As I live in a city, there is always some cool events going on. When I was in college I went to a free concert that had bands such as Imagine Dragons playing, before they were famous, that was a ton of fun. Finding events like these can be just as much fun as a $100 concert and it is a lot easier for the budget.

Travel can also be a very expensive category. Whether it be local or foreign travel, try to see if there are credit card bonuses you can use. Mad Fientist has a credit card rating system with their reward value on his site that I recommend checking out as it can amount to hundreds in savings. I would also recommend visiting places where you may have a friend as it can substantially reduce your price of lodging.

I estimate that free activities and travel hacking will save me close to $2,000 a year or another 4% increase in my savings rate.

Just by cutting my cost in these three categories I am able to add an additional $10,400 to my savings and increase my savings rate by 22%. When I add in my 401(k), HSA, and IRA contributions, I should be well over my goal of 55%.

Challenge yourself and reduce your expenses; your wallet will thank you later!

19 comments… add one
  • FinanceSuperhero Feb 13, 2017, 9:27 am

    Great all-around advice, Stefan. It’s good to see you’ve avoided the trap of living it up now that you’ve finished your MBA and started work.

    • Stefan Sharpe Feb 13, 2017, 9:08 pm

      The paycheck is nice but I want to build wealth rapidly. I will post why I am living paycheck to paycheck soon!

  • Financial Panther Feb 13, 2017, 1:52 pm

    Awesome that you kept living like a student and stuck with a roommate. Majority of people will get the paycheck and then immediately get themselves an expensive, luxury apartment. I think rent is the huge killer when it comes to saving a ton.

    • Stefan Sharpe Feb 13, 2017, 9:09 pm

      Rent is a budget buster! I will live the student life as long as I can.

  • wealth from thirty Feb 13, 2017, 6:55 pm

    Great ideas for improving savings – I’m trying to limit how much I eat out, which could save me $2500pa if I reduce hit my target reduction.

    • Stefan Sharpe Feb 13, 2017, 9:11 pm

      It takes a lot of control not to pick up that phone, go out, or order online. Cooking can be a great way to put more in your bank, let me know what recipes you find!

  • Jack @ Enwealthen Feb 14, 2017, 12:38 pm

    One of the best things I did once I got my first job was to rent a place by myself. After a lifetime of living with other people, it was glorious to have a space all to my own.

    That said, I was forward thinking enough to rent a 2 bedroom place, so once I got tired of paying the rent by myself, I found a roommate so I could go back to saving money.

    I’ve had a roommate ever since, because it’s smart to reduce your such a major expense, but I treasure my memories of the time I had a place to call my own.

    • Stefan Sharpe Feb 14, 2017, 10:23 pm

      If you have your own room it really is not terrible unless your personalities clash. Luckily we get along fine and everything runs smoothly. You can always get that room back once you are FIRE.

  • Micro Dividends Feb 17, 2017, 11:08 am

    Those are some astonishingly low number at 5.7% savings average savings rate. This is a huge contrast say comparing to other countries. What people don’t realize that even at 5.7% interest rate, they are not accounting for inflation which is roughly 2%. It’s such a shame that personal finance, and economics is not taught properly in our education system.

    • Stefan Sharpe Feb 19, 2017, 9:57 pm

      Inflation is one of the most forgotten concepts that heavily impact real returns. Most of the time we only speak in nominal terms but you bring up a very important point!

  • Dividend Diplomats Feb 17, 2017, 8:41 pm

    Stefan –

    EXACTLY. All of what you have mentioned matters, it matters tremendously and we need to fight for every damn dollar. Keep it up, you’re doing great and being at such a young age, you are on the fast track to freedom.


    • Stefan Sharpe Feb 19, 2017, 8:06 pm

      Thanks Lanny! Pleased to say that you and Bert have been a major influence in my life so keep it up on your end too!

  • Wallet Squirrel Feb 19, 2017, 4:59 pm

    Ugh, I agree. Food is such a waste. I’ve done the same thing by eating in more and learning to cook. I haven’t cut down to pizza rolls and Spegettios yet, but I’m close. More or less cold cut sandwiches and protein shakes after workouts have dramatically helped.

    Rent is kind of killing me, but saving in the food and entertainment areas really helps!

    • Stefan Sharpe Feb 19, 2017, 8:07 pm

      haha good ole pizza rolls and ramen! I still go out every weekend I am just very conscious of how much I spend. Is moving an option for you?

  • Investment Hunting Mar 2, 2017, 12:43 am

    Man eating out really does get expensive. I eat breakfast at home bring my lunch to work everyday. Most people I work with buy breakfast and a coffee on the way to work, then go to lunch everyday. It’s insane to me, especially in San Francisco. Here a cheap lunch is still $15 to $20.

  • timeinthemarketblog Mar 5, 2017, 12:02 pm

    I’d like to echo the comments about having a roommate being a big deal especially if you live in a higher COL area. I still spend quite a bit on my rent and I split it with my girlfriend(not quite a full split since I make a bit more than her) but having her here really takes the edge off that expense. It also helps having a partner to split other costs with as well as it’s quite easier to buy for two than just for one with certain things.

  • Dividends Down Under Mar 13, 2017, 1:29 am

    I love how much you’re planning to save Stefan, particularly with each of the categories you mentioned. I love that you got a slow cooker!

    We’re aiming for a savings rate of around 40%-50% this year.


  • Rob @ Money Nomad Mar 18, 2017, 9:49 pm

    Fantastic list! From the roommate, to food, to entertainment — all great ways to save money. And if you keep this blogging up, you’ll be able to increase your income in addition to cutting your costs. Good luck and keep up the awesome writing.

  • Lance @ My Strategic Dollar Jun 9, 2017, 10:45 am

    “Challenge yourself and reduce your expenses; your wallet will thank you later!”

    Loved this quote! Best thing about this article is opening up on the truth that living on the least amount you can today will help you live like nobody else can in the future.

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