The 3 Best Things to Cut From Your Budget If You Need to Save More

Want to slash your spending? Here are some tips for how to make big cuts to your budget. 

Whether you're trying to save for important financial goals or simply hoping to keep everyday spending low enough to avoid credit card debt, you may need to make cuts to your budget. Most people look at the little stuff -- like their daily latte -- to reduce cash outflow.

While cutting out frivolous little expenses can make sense if you're spending a ton on them over the course of the month, reducing this type of spending often doesn't add up enough to be meaningful -- and it can strip all of the joy out of your life. 

Instead of nickel-and-diming yourself and trying to reduce small expenditures, it can make more sense to go after the big stuff and see if you can make reductions. If you can make a single lifestyle change that cuts several hundred dollars from your monthly bill, that'll be more sustainable than reducing spending on everything you find fun. 

So what are some of the big things you can try to cut spending on? Here are a few suggestions. 

1. Housing costs

Housing is one of the biggest expenses most Americans face. While you need somewhere to live, reducing the costs of your abode can make a huge difference in the amount of money you have for other things. 

Unfortunately, millions of Americans are "house-poor," or spend more than the recommended 30% of their income on housing expenses. If too much of your money goes to your mortgage or rent, this is a prime area where you should look into making cuts.

You could cut housing costs by moving to a smaller home or to an area with a lower cost of living. You could also consider renting out a room to help defray some of the expenses associated with your home. If you can do either, you may free up hundreds of dollars of cash that you'd previously committed -- giving you much more financial flexibility than if you try to achieve the same savings by reducing spending on a number of various small expenses. 

2. Transportation expenses

Transportation also takes up a good chunk of most people's budgets. While you definitely need to get to work and other important places, you may not need to spend so much to do so. 

One of the best ways to cut transportation costs is to buy a less expensive car -- and ideally, pay for it with cash. Avoiding a car loan could free up hundreds of dollars a month. 

If you can, consider giving up a vehicle. This might be possible if you're living in a two-car household and could share a car or if you live in a walkable area and don't need to own a vehicle at all. 

3. Insurance costs

You absolutely cannot go without insurance. But insurance is very expensive -- especially health insurance. Make sure your policies are aligned with your needs so you aren't paying more than you should be.

Saving on insurance doesn't necessarily mean buying the cheapest policy in every situation. In fact, in some cases, you might be better off paying more for a policy that covers more services or that has a lower deductible. The goal should be to get the lowest total costs when factoring in both the policy expenses and the expenses for the care you need. 

Unfortunately, because shopping for insurance can be confusing, many people stick with the same policy year after year without considering whether it still makes sense for their situation. That's why it's so important to review your coverage annually to see if you can make a change that brings your costs down. In some cases, you can save hundreds of dollars. 

Look for the big stuff when cutting your budget

These are just three examples of big expenses you could cut to reduce your budget. You may also have other big-ticket items that you spend on. When you need to reduce your costs of living, always look to the big stuff first. You'll likely find it's much easier to make a meaningful difference in expenditures when you do.