How to Save Money Each Month

We are very close to a monthly passive income of 1,000 CAD. The question how to save money each month will always be relevant. It is not possible to receive passive income without savings — in other words, pay yourself first. Here are highlights of our savings:

1 We rent a townhouse.

The cost of renting, which is about 1,400 CAD, is far less than the cost of buying an equivalent townhouse in the area. A similar townhouse would cost around 800,000 CAD. Let’s say that after a down payment of 100,000 CAD, we would still pay more than 3,000 CAD monthly for the mortgage only. Therefore, mathematically, simply renting helps us to save more than 1,500 CAD each month. We also do not see owning a home as an investment. For us, it is a roof over our heads.

2 We do not send our kids to private schools.

Both of us graduated from universities without previously learning in private schools. Therefore, this is not a prerequisite for higher education. Additionally, there are cheaper alternative ways to boost kids’ learning, like additional lessons and private teachers.

3 We drive one car.

Although it may be more convenient to have two cars, we intentionally drive only one car and use public transportation. An extra car would cost at least 400 CAD a month, which is 4,800 CAD annually. This is a lot of money to be invested. It is almost half the amount of what needs to be invested to make you a millionaire in less than 30 years. Sometimes, for winter skiing, we rent a big 4×4 car for a few days, and it is still cheaper than having two cars.

4 We minimize our car insurance.

To make the insurance business profitable, the number of incidents that insurance pays for should be significantly lower than the number of clients who have insurance. The business is built around the idea that not many incidents will occur. We try to take advantage of this and increase our participation to the maximum allowed and keep all other options at around required minimum. This saves us about 200 CAD annually.

5 We do not eat out much.

Eating out is costly. One meal portion costs about 15 CAD, and so for two persons, this comes to 30 CAD. Eating out two times a week will cost 240 CAD monthly. Considering that there are always occasions like friends’ or family members’ birthdays when one might want to eat out, we try not to eat out on our own.

6 We budget our spending.


We use to check our spending and see where it could be lowered. We have set budgets for each category and keep an eye on them.

7 We buy vegetables from appropriate shops.

It is cheaper to buy vegetables from a local farm store, which is what we do. We do not buy vegetables and fruits from big stores like Costco.

8 We always compare prices when buying anything.

Thanks to online shopping, checking the available prices for any product is not complicated. A plug-in called Keepa is available for browsers that shows historical product prices on Amazon.

If the price of something was less in the past, it will most likely be reduced again. This is worth waiting for. Why pay more if you can pay less?

9 We do not carry any credit card debt.

Credit cards charge interest every day, which comes to 15–20% annually. We are not willing to pay interest in any case, which is why we pay our credit card debts in full every month.

10 We do not pay for bank accounts management.

Our checking accounts and all accounts are management-fee free. We keep a balance of 5,000 CAD in the TD Canada Trust to get a management-fee free checking account. Additionally, a certain amount needs to be kept in the accounts at our broker TD Waterhouse to eliminate account fees, which is what we do. The account management fees may be 30 CAD a month, amounting to 360 CAD annually.

11 We utilize VISA cash back.

Our primary Visa card is Scotia Momentum, which pays 4% cash back on groceries and gas and 2% on drug stores and recurring bill payments. Our overall annual cash back is about 1,000 CAD.

12 We cut our cable and eliminate our landline.

This can save you more than 60 CAD every month.

13 We buy used sports equipment.

Our family is skiing at a beginner’s level. We buy all our ski equipment from a second-hand store. We bought hockey and skating equipment at the same shop. Just the ski equipment saves us a few hundred CAD a year.

Importance of saving money each month

Without these savings, we would pay more than 26,500 annually. Investing this amount of money will make you a millionaire in less than 15 years. You can read about how this is possible here.

We will be more than glad to hear from readers about other ways to save.


  1. Marina October 10, 2017
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