5 Ways To Save More Money This Year
High on most peoples lists of goals is saving money. Saving money on expenses, saving for retirement, college and emergencies, and saving money in general. There are so many ways to save money that are usually “hyped up” and then there are so many that are very easily over looked.
Each year our family does a lot to save money, we scrimp on expenses, so we can save money for “the big picture” and we do everything we can to get the highest returns on our money without a lot of risk.
Here’s some of the most commonly overlooked ways to save more money (and get the most out of those savings) that have worked well for our family:
- Automate everything. When you don’t have to think about sending a check to the IRA or depositing money into your savings account when you cash a check, you are more likely to stick to a savings plan. We allot savings into our budget and count it as an “expense” so we never feel like that money is “spendable”. However you choose to set it up, it is so painless. Contact your bank(s) and set up automatic deposits and withdrawals for dollar amounts you are comfortable with, then forget about it. Seriously, pretend like that money does not exist. This is one of the easiest ways to save money without feeling like you are depriving yourself, yet so many people aren’t doing it. It is easy to set up and after a while you won’t even think about that money.
- Shop interest rates. Many people pick a bank they like, set up a checking and savings account and stay there with that bank for all eternity. Bad idea. Even if the bank down the street is only offering .50% more for savings than your bank, that is an extra 1$ per year for every 100$ you have in your savings account. That doesn’t seem like much, but it all adds up and that is free money that you are missing out on. If you have 5,000 in that savings account that .50% can mean an additional 25$ in your account after one year without any further deposits. It is just smart to shop interest rates. I use bankrate.com to compare the interest rates of local banks as well as online banks(which usually offer a much higher interest rate)
- Re-work your budget.Once you have a budget that works for you and is easy for you to stick to, it is easy to become reluctant to rock the boat. Just do it, though. Over the course of the year, many things can change that can affect your budget. Did you have an increase or decrease in your monthly expenses? Did you have an increase or decrease in your income? What about cutting back on new things, like eating out or going to the movies, can you cut back on those things to tighten your budget? What ever the case may be, it is always a good idea to look at your budget with fresh eyes, you may even be pleasantly surprised. A good rule of thumb is to take a look at your budget and re-work it every six months to make sure you are being smart with your money.
- Get new insurance quotes. Rates and rules can change, so make sure you have adequate insurance and that you are paying the lowest prices available to you. This goes for all your insurance:homeowners, auto, life, etc. Call around or go online and compare quotes for everything you need and see if you can save money by moving your accounts to a new company, or better yet to avoid hassles, ask your current company to lower your rates. You’d be surprised how easily they will accommodate you if they think you will leave. We have all of our policies at one company, every year I look around for quotes, if I find something cheaper, I call my agent and voila, I have a lower rate and I didn’t have to change companies. Also, ask about discounts for multiple accounts. Many companies will lower your overall rates if you use them for all your insurance needs. It can save you a lot of money and is definitely worth the time it takes to shop around. Check out Bankrate for rate comparisons, they list a lot and this can save you some time.
- Ask for a lower APR. Whether you have balances on your credit cards or not, if you pay the balance in full each month or pay it over time, doesn’t matter. A lower APR is always a good thing and can save you beaucoup bucks. Call your credit card companies and ask for lower rates, this works especially well if you have an account in good standing and have been a customer for some time. If you toss out there that you may switch providers, they will usually drop your rate quickly and if not they will or should at least cut out the annual fees(if you have any). (The national average for a platinum card is 10.71% as of today; so if you are paying 13%, you should be able to haggle the company down 1 to 2%)
I hope you find these ideas useful and I hope they work for you.
Happy Saving!
Topics: Finance & Money |
January 4th, 2008
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January 4th, 2008
These are great tips! As my family’s budget planner, I am always looking for new ways to pinch pennies and it starts to get tough finding non-essentials in the day to day. I never really thought about things like getting lower APR or looking at insurance or interest rates as ways to stretch a dollar even further. I do agree with the “pay your savings” first philosophy.
We’ve also found it really helpful to switch to cash for things like buying food or entertainment - we seem more likely to hold on to that 20 dollar bill, especially if it’s our last! Sometimes the bank cards are almost like we’re not really spending money and we end up buying things that if paying by cash we’d put back on the shelf!
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January 4th, 2008
Melissa-
I couldn’t agree more! Cash can make you save more money than a debit or credit card, because you can VISUALLY SEE the money being spent, and that is a lot different than looking at a monthly statement!
I am always looking to find new ways to stretch our dollars, and I find that most of them are so easily overlooked! Everyone tends to focus on saving “in the now” by shopping sales or cutting back on expenses, but we never think about those things that save us more money in the long run! I am glad you like my tips and I plan on adding tons more as I am trying to dedicate more time to this blog!
Take Care
LJ
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