You Can Save $45.97 Per Month by Making This Change

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One change on your part could leave you $550 richer after a year. Read on to learn how to make it happen. [[{“value”:”

I remember being so excited when my parents decided to get cable during my childhood. From that point on, it was bye bye, crappy reception. With cable, I could actually get a clear, crisp picture on my TV screen.

Oh, and the choices. Man, those were amazing. Forget network TV — I had Nickelodeon, baby. I would’ve watched that channel all night had my parents let me.

These days, cable is more of an ordinary expense for many people. But it can be an expensive one. And there can be many cheaper alternatives. So if you’re short on savings, you may want to consider downgrading your cable service — or even getting rid of it altogether.

Downgrading your cable plan could save you big money

U.S. News & World Report says that the average cost of basic cable service was $25.40 as of 2018, which was the last time the Federal Communications Commission put out data along these lines. The cost of expanded basic service, meanwhile, was $71.37 per month on average. That brings the difference between the cost of expanded cable service and basic cable to $45.97 per month, or roughly $550 a year.

Here’s why that’s so important: A 2023 SecureSave survey found that 63% of working Americans could not afford a $500 emergency expense. So if you’re able to downgrade from expanded cable to basic cable, you might manage to pocket $550 after a year. Put that money into a savings account, and you’ve got the starting point of a nice emergency fund.

Also, because these numbers are a bit dated, it’s fair to assume that downgrading your cable plan this year could result in even more monthly savings than $45.97. So if you’re not watching all of those channels, why keep paying for them?

Furthermore, if you don’t get much use out of cable, you may want to consider dumping it altogether and finding a streaming platform to use instead. As an example, you can pay just $6.99 per month for Netflix with ads, or $15.49 for ad-free content. That’s cheaper than cable, and if you don’t watch all that much TV, it could make more sense for your budget.

Take a close look at your spending on a whole

If you’re doing just fine financially — meaning, you’re meeting your savings goals and are paying your bills each month with ease — then there may not be a need to make any changes to your spending. But if that’s not the case, then it definitely pays to spend a little time doing a spending audit.

Comb through recent bank and credit card statements to see where your money’s been going lately. And then, assess each non-essential expense on its own to see if you should keep paying for it.

If you’re spending $42 per month on a gym and you go three times a week, don’t cancel. That sounds like you’re getting your money’s worth. But if you’re spending $15.49 on Netflix and you only watch it for an hour per month, you should probably cancel.

The reality is that money is tight for a lot of people these days. So if there are expenses you can cut back on without wrecking your quality of life, why not bank that money instead of spending it and getting little in return?

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The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.Maurie Backman has positions in Netflix. The Motley Fool has positions in and recommends Netflix. The Motley Fool has a disclosure policy.

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