As a nation, we annually waste billions of dollars on uneaten food,over priced clothes, unused, unnecessary items, uncompetitive savingsaccount rates and excessive credit cards interest. American consumersthrow away money as never before and the credit card bills roll inwith their record of excessive Christmas spending. This makes Januarya perfect time to start putting your personal savings finances inorder.
I know that I find something freeing, almost liberating aboutspending money away on treats for myself. It can be something ascheap as a pad of notepaper with some fancy design on it that costs$5, or as expensive as staying at a hotel room instead of driving twohours home after a conference. However, there is no reason why peoplewho save their money should accept miniscule interest rates or sky-high credit card interest charges.
Spending a few minutes now to find a better deal will leave youbetter off by December 31. Leaving things the way you have left themin the past is like setting fire to your own money. By making a fewchanges to improve your accumulation versus your spending will makeit so that the odd taxi home, the takeout chicken or spontaneousclothing purchase will not have a dramatically negative effect onyour bank balance or credit card debt."
Here are 10 easy ways to save money in 2005 and every year beyond.
1 SAVE ON FOOD
Healthy eating doesn't have to be expensive. Making your sandwichesat home and taking them to work might cost you $3 a day if you reallygo all out on the fixings and drink. Buying a sandwich, drink, andchips at Subway or McDonalds and you've dropped $5 - $9 plus ingestedmore calories, fat, and preservatives than is healthy for you. If youcut $2 a day out of your spending, and weekly or monthly put thatmoney into a special account at your bank or freezer, you will have$10 a week, $40 a month, $500 a year. Maybe that is your Christmaspresent fund?
Slash supermarket bills by making a shopping list and sticking toit. Avoid picking up the over priced "bargain" extras placed at theend of the aliases where they can tempt you. (Tip: Leave the kids athome when you grocery shop.) Give the store's own brand a try, theirvalue ranges can cost a third the price for name-brand items andcontain the same nutrition. Buy fruit and vegetables in local farmersmarkets in season - prices are competitive, you know the people whogrow the food and you get to be outside for a bit of fresh air.Make your meals at home and freeze portions for future meals. Oftentimes the home cooking is lower in fat, sugar and salt than ready-to-eat meals and having the food in the freezer, ready to thaw willreduce the temptation to by over-priced takeout.
2 SAVE ON DAILY SPENDING
Take a good look at what you really use. Do you have a gymmembership that you only visit occasionally but seem to renew everyyear? Do you take the bus or taxi to work? Save a few dollars and getin some free exercise by getting out a couple blocks early.Leave the ATM machine card at home, and when you do use it, takeless money out than you normally do. It's harder to waste the moneyif you don't have it in your pocket. Join the local library - you'llspend less time in bookshops. Shopping for purchases can also savemoney - many major stores offer a price promise matching anyadvertised price.
3 MORTGAGE SAVINGS
Penny watching will save a small fortune over the years, but takingthe trouble to find the lowest over-all cost mortgage available canalso save a small fortune. If you can recoup your costs through alower interest rate in less than 2 years, go ahead and refinance,over the long haul that lower interest rate can save you some realchange.
2003 provided the lowest interest rates in 50 years, yet manyhomeowners failed to switch to a cheaper mortgage rate. 2004 was alsoa year of decent interest rates, yet many homeowners are still payingtoo much interest. Instead of simply writing a check next month looksinto the possibility of refinancing.
4 CUT HOME INSURANCE COSTS
Cutting home insurance is also easy. Identify the level of coverageyou need and then shop around to find the lowest premiums based onthat coverage. If you are willing to self insure more than thestandard $500 deductible - that is pay the first $1,000 or $2000 of aloss - you will find a significant savings in the annual rate. Justbeware, that many of the small things like broken windows, a fewshingles off your roof will not be paid by the insurer because theycost below that $1,000 deductible.
Lower premiums are also offered by some companies to members of aneighborhood watch or to the people with extra security. Good qualitylocks, alarms, and security systems deter break-ins and some insurersdiscount for that. Don't forget your outbuildings when looking forinsurance coverage. Many of the items in your garden shed areexpensive to replace if they disappear.
5 CUT CAR COSTS
Your car can be expensive to operate. Fuel, maintenance, andinsurance can cost per mile more than the current 37.5 cents the IRSsays a vehicle costs to operate. Depreciation can total nearly 60% ofa new cars cost in the first 2 years. Keeping your tires properlyinflated, the filters clean and the starting and stopping to aminimum will increase your mileage and decrease expenses.
Using the Internet will help you cut your insurance costsdramatically if you go online to shop for a better insurance rate.Another thing that will help with your insurance fee is keeping yourdriving record clear of moving vehicle tickets - don't speed.
6 SAVE ON UTILITY BILLS
Depending on where you live the deregulation of gas and electricitymeans suppliers have competition now and deals are available if yougo looking. Consumers stand to save nearly a third of their gas billif they live in areas with competition and are willing to shop aroundand ask for the savings.
You can save even more with energy-saving measures like drawing thecurtains at dusk, turning the TV off rather than using standby,buying energy-efficient light bulbs and turning the thermostat downjust one degree, at night or while you are away during the day.When you go to renew your cell phone - shop around. The act ofCongress mandating the option to take your phone number with you hasproved many cheaper rates and more incentives to get you to switchfrom one carrier to the other.
7. LIFE INSURANCE
Life insurance rates have fallen the last few years, especially forthe term rates. At a minimum buy enough insurance for your spouse tobe able to live without employment until the kids are old enough togo to school. Get on the internet and search for the best rate youcan find. You won't even have to deal with an insurance salesman.
8 SAVE ON CREDIT AND BANKING
Credit is a way of life today, and many of us are paying through thenose for trillions in unsecured personal borrowing on credit cards.APRs can reach almost 25 per cent for in-store credit, and manystruggle to pay the interest, adding punitive years to the borrowingterm.
Instead look at low-cost loan to consolidate debts, or a new creditcard with an introductory rate of zero per cent on purchases andbalance transfers. You can even switch your borrowing from one cardto another as the free introductory rate expires. The key is to holdyour payments level, even as the minimum required drops. Doing thiswill cut 20 years off most repayment times.
Competition means better banking deals, though you might need tofind a small bank to get the best rates of interest or lowest costfor services. Always pay attention to what your level of service isgoing to cost you, what does a box of duplicate checks cost, and ifyou accidentally bounce a check what is the overdraft charge and howmuch you'll be charged to receive a copy of your paper checks.
9 INVESTMENTS
Always make sure you are getting the interest rate you deserve forwhatever savings you've got. The rate will depend on your level ofcomfort dealing with the internet, telephone banking or if you need alive person to deal with. Online banks offer a higher interest ratebecause they have less overhead costs than a brick-and-mortar bankstaffed with live humans.
Check rates regularly - banks tend to be slower to raise theirpayment rate than when raising the cost of borrowing. Don't forget tomax out your IRA, 401k, or whatever savings vehicle you have that istax deferred or tax free.
10 CUT TRAVEL COSTS
Using a website like www.travelocity.com can mean you save a lot ofmoney when buying a package deal. The savings can be really huge ifyou are willing to shop online at the last minute. Shop around forreasonable priced travel insurance - an annual insurance policy maybe cheap if you take several trips a year. Try to fly an airline thatis not in bankruptcy trouble so you can be confident they willprobably still be in business when you need to travel
Roger Sorensen
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