HOW TO SAVE
In recent articles I have presented contrasting opinions on the future direction of our equity markets. Even the media can’t decide if the recession is nearing its end or not. What we do know for certain is that there hasn’t been a tremendous surge in wages, job creation or the stock market. As we await a clear indication of where the market is taking us, it is prudent to exercise caution and to reel in spending. Here are a few ideas to assist.
* If you’re not paying off your credit card balance each month you’re paying interest and likely at a pretty steep rate. Pay this debt off and you could save a tidy sum by eliminating your interest charges.
* The average family regularly throws away nearly 15% of the food they buy at the grocery store each year? That can add up to hundreds or, depending on your supermarket budget, thousands of dollars each year. Save money by actually eating what you buy. Get inspired and borrow a cookbook from the library!
* Have your fixed monthly bills paid automatically to avoid missing a payment and incurring late fees and/or interest. You can set up auto-pay features through your bank’s online bill paying service or by arranging it directly with the company or service provider you owe.
* If you’re paying different vendors for similar services you may be overpaying. Call your communications providers to see what price you’ll be quoted if you switch and bundle your internet, phone and cable TV services.
* Whenever you rent something – library books, videos, etc. – mark it on your calendar and save money by avoiding those quickly mounting late fees. Many stores and libraries also now offer email reminders!
* You should do everything you can to ensure that your taxes are paid in full and on time. However, if you need to file an extension, at least pay what you owe on the due date. You’ll avoid annoying notices from the IRS and, more importantly, save on penalties, fees and interest.
* If you’re switching jobs and you can’t leave your 401(k) invested with your current company, instead of withdrawing the money, roll it into either your new employer’s 401(k) or an IRA within the 60-day window. By doing so you’ll keep the money invested – and earning interest – and avoid those nasty taxes as well as the additional 10% penalty
* If you’re carrying a balance on a high-interest-rate credit card, check out other card issuers to see if you could transfer your balance to one with a lower interest rate and fewer fees. Use sites like Creditcard.com or Bankrate.com to compare card rates, and pay careful attention to how long those terms last, so you don’t wind up paying a higher rate and erasing any potential savings.
* Are you an AAA member? Do you belong to the AARP? What about your local credit union? Check organizations you have memberships with to see if they offer buying privileges or discounts – you could save a ton!
* If you’d like to save money, just ask. Why not ask if you can get the interest rate lowered on your credit cards or loans? You could also ask for a discount on services like your wireless phone, trash removal or pet care instead of switching to another vendor. And do try to to haggle with salespeople on any big ticket purchases like cars, appliances and furniture.
* Americans average more than $750 yearly on holiday gifts and that’s probably much more than most would like to spend. If your gift-giving is costing you more than you can realistically afford, there’s a good chance it’s more than your relatives can afford as well. Take the plunge and broach the subject. Offer a more reasonable alternative (say, limit giving to children or put a dollar amount on gifts per person). More than likely, your relatives will be grateful SOMEONE finally raised the subject and you’ll save money in the process.
* When withdrawing cash, drive or walk the extra minute it takes to use your bank’s ATM and avoid the fee that could come with another bank’s machine. Better yet – switch to a bank that doesn’t charge fees at all!
* If you’re paying for cable why not use all of it – and save some money in the process? Cancel the video membership and watch movies through cable movie packages you’re already paying for or check out your free “on demand” shows. Drop the gym membership and work out at home to channels like FitTV, and bag the magazine subscriptions and watch the same shows (like Martha Stewart) on TV instead.
* This is a very sensitive issue but one that bears considering. Smoking, overeating and drinking are costly habits to maintain. Eliminating any or all of these may not necessarily be easy but you can save a ton of money by eliminating your favorite vices. You’ll save money by cutting out on the regular spending it’s costing you, and you’ll probably save on insurance premiums and long-term health costs. You win two ways.
