How many times have you heard personal finance gurus say “skip the $5 coffee” and that’s how you’ll reach financial freedom?

Sure, saving a few dollars here and there will help a little bit but there’s far more impactful things you can do with your money so you don’t have to worry about that $5 coffee again.

If coffee isn't your thing, maybe you enjoy shopping or eating out.  Everyone has at least one thing they love spending money on.

Now, what can you do with your money so you can start to spend guilt-free?

Let’s take a look.

Automate your savings

You may have heard about this technique before, but automating your savings is one of the most impactful things you can do with your money.  

It guarantees that the money is being transferred and saved.  You don’t even have to think about it.

If you’re like me, without automation you’ll fall back into the path of least resistance.

When you get that paycheck on a Friday, you’ll forget to transfer the money, go out to lunch with coworkers, and then go out to Happy Hour and before you know it - it’s the next pay day and no money was saved.

By automating your savings, you’re removing the human error from the equation.

Tip: Set up a recurring automatic transfer from your checking account to your savings account on specific days of the month (Pay day is a common date used)

Evaluate your housing

Housing is usually one of the largest expenses in your monthly budget, which also means it can have the most impact on your likelihood of achieving financial freedom.

When evaluating your overall financial picture, housing tends to get overlooked because it instinctively feels like something that can’t be changed.  

We usually end up focusing on the $20 we can save by removing a subscription service or the $40 we spend at Starbucks every month.

The truth is, housing may be the one expense that’s holding you back from financial freedom and guilt-free spending.

Let me explain - when you're going through your budget and you see that you're spending maybe an extra $50 on coffee or $100 on food than you'd like to spend, it's easy to look at those expenses and think those are what's holding you back.

However, we usually overlook the $1,300 in rent or monthly mortgage payment because those are fixed costs - we can't do anything about them.

Fortunately, this isn't the case.  

There's always the opportunity to sell your home and downsize.  This may not be the most glamorous option, but in many areas of the country the current housing market is strong for sellers and you may even end up taking a profit.

Even refinancing your mortgage may save a couple hundred dollars each month.

If you're renting, you have the flexibility to move at the end of your lease.  Moving into a cheaper apartment for a year or two can help save money without adjusting anything else within your budget.

You never know until you look into it and evaluate your situation.

Evaluate your credit score

Your credit score may be a silent killer in your quest to financial freedom.

It’s something you may not think about and similar to housing, can have a massive impact on your financial picture.

Let me paint this scenario real quick:

Let’s say you decided it’s time to buy a $200,000 home and everything about it makes sense, there’s no question that buying a home is the right choice in this situation.

If you have a 760 credit score, you might get an interest rate around 2.5% on a 30 year fixed-rate mortgage, according to MyFICO.com.

If you had a credit score 100 points less, that 660 credit score will give you around a 3.1% interest rate.

Only a .6% difference. Not that big of a deal, right?

Over the length of the mortgage, you’ll end up paying an extra $23,550 in interest by having that extra .6% in interest.

You could buy 4,710 lattes with the amount saved by just maintaining a higher credit score and receiving a lower interest rate.

Or you could invest that $23,550 you saved and this is where it gets interesting.

You'd be saving about $65/month with the lower interest rate and if you simply invested that $65 every month for the 30 years, the same length as the mortgage, and got an 8% return in the stock market . . . that $23,550 turns into almost $97,000.

Your credit score may seem like a small part of your overall financial picture but in my opinion, there’s few things you have as much control over as your credit score.

The impact it has can save you tens of thousands of dollars throughout your life.  

Much more than cutting out your weekly Starbucks.

Evaluate your income

If you find yourself cutting all expenses, budgeting, and still find yourself struggling to reach your financial goals, it may be time to consider increasing your income.

Luckily in today’s world, there’s unlimited ways this can be done.

Whether you pick up a side hustle like DoorDash or Uber or start your own Etsy shop, there’s never been a better time to create your own income.

For those who don’t have the time or want to start a side hustle, there’s the opportunity to increase your current income.

If you work a 9-5 job, when was the last time you received or asked for a raise?

The fear of asking is usually what holds people back from pursuing a raise, but it’s important to remember that you’re providing value to your company and you deserve to be compensated fairly.

If you’ve been doing a good job, you consistently work hard, and you feel as if your pay doesn’t reflect the value you’re bringing to the table - don’t be afraid to ask for a raise.

You might not receive it immediately but by asking, you’re showing initiative and you’ll stand out amongst other employees.

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By focusing on the bigger picture items in your financial life, you’ll see more of an impact than you’ll ever get by trying to cut out all your day to day expenses.

Don’t step over dollars to chase pennies.