I'm a millionaire - this is how you can save hundreds a year by cutting back on basic luxuries

The latest financial figures have showed that millions of Americans will be feeling the crunch more and more in the coming months. 

America's combined household debt shot up to a record $17.5 trillion in the final three months of 2023 - and inflation has raged through all sections of the US. 

At the same time, a staggering 80 percent of Americans now find themselves with less cash in reserve than they did before the pandemic hit.

Financial expert Craig Bolanos, the CEO of the Illinois-based Wealth Management Group has spoken to an ABC affiliate in Chicago about some tips on how to save hundreds of dollars per year.

Bolanos, whose firm provides investment management services, says the obvious starting point to save money is to open a savings account. 

Craig Bolanos, CEO of the Illinois-based Wealth Management Group, made an appearance on ABC Chicago to offer some tips on how to save money during a stressful financial period for Americans

And even though record-high interest rates make it harder to borrow money for cars, mortgages and everything else, they have a distinct benefit. 

Bolanos points out that the rates on savings accounts are the highest than they've been for 15 years.

'I want everyone to open up a savings account or a high yield savings account to sit alongside that checking account to start earning some extra interest.

Major banks and financial institutions such as Capital One, American Express, and  Barclays all offer high-yield savings accounts with annual percentage yields as high as 4.35 percent.

In practice, if you put $500 into a savings account with a 4.35 percent interest rate and left it for a year without a single contribution, you'd have $776.48 at the end of that year.

If you up your monthly contributions to just $20, as Bolanos suggests, your $500 would turn into $3,786 after a year.

Capital One Bank offers a 4.25 percent APY for certain savings accounts 

Of course, saving is only one side of the issue. 

Bolanos took a page out of the Dave Ramsey playbook, saying spending is the other behavior Americans need to modify in order to have more cash in their pocket.

First up, streaming services, which Americans pay an average of $61 per month for, according to a report from Deloitte. 

Bolanos says if you cut out even a single service, you could save around $15 per month, which would turn into $180 over the course of a year.

Netflix and Disney+ are among the biggest streaming services and their ad-free tiers cost $15.49 and $13.99, respectively

Cutting back on takeout and coffee from places like Starbucks is also important, Bolanos says. Doing one less night of eating out or two less of your favorite sweet, caffeinated drink could save roughly $12 per month, or $144 a year.

Bolanos says if you cut out even a single streaming service, you could save around $15 per month, which would turn into $180 over the course of a year

Doing one less night of eating out or two less of your favorite sweet, caffeinated drink could save roughly $12 per month, or $144 a year

Finally Bolanos recommended to shop around for your insurance before simply reupping when you get a renewable notice in the mail. 

That goes for health insurance, auto insurance, homeowner's insurance, and really any other kind of plan you could conceivably buy.

If you do this, Bolanos says you could save up to 20 percent a month.  

Going into 2024, Americans appear to be taking the advice to reduce their spending.

A Wells Fargo survey from February 2024 found that 67 percent of Americans are in fact cutting their expenses.

Still, a solid 35 percent say they've dipped into their savings or investments cover costs, with even more - 62 percent - saying that after paying bills they have little left for 'extras.'

'The data tells us that Americans – no matter who they are – are uncertain about the sustainability of their financial lives,' said Michael Liersch, head of Advice and Planning for Wells Fargo.