Saving money: living within your means
Frugality is a virtue that can be taken too far. Here are anumber of pointers on how to find a sensible middle groundbetween overly stingy and wasteful.Frugality is a virtue that can be taken too far. You know you'rethere when you're seriously looking into issues like recyclingdental floss or replacing hot showers with paper-towel andrubbing-alcohol sponge baths. On the other hand, daily splurgesat Starbucks, late-night infomercial shopping and pet-spatreatment for your dog will likely prevent you from savingenough to ensure a comfortable retirement. In other words, weneed to establish some sensible middle ground where you can livea normal life without going broke. Here are some suggestions toget you started.* Be a picky customer. Ask the credit card companies to lowertheir rates. Call your auto insurance company and ask aboutgood-driving discounts, and whether they can give you a betterdeal for consolidating all your insurance needs with them.Compare the fees on your investments and threaten to take yoursavings elsewhere if you don't get a better deal. Typically,each of these calls only take a few minutes, but over the yearsthese small changes really stack up.* Start making extra mortgage payments. You can shave years offthe life of your loan by paying an extra $100 a month now, whichis especially appealing for those who intend to stay in theirhouses until retirement. Another option is to sign up for abi-weekly payment plan, in which you simply pay half yourmortgage in the middle and other half at the end of the month.While the sum stays the same (former monthly payment divided intwo), the wonder of compound interest kicks in and takes yearsoff the loan.* Don't change cars often, but when you do, buy used. Sure, the'new car smell' is nice, but by the time it has worn off, so hasseveral thousand dollars in value. When picking your used car,go with quality. In addition to the auto magazine ratings, doyour research online to get consumer opinions on different carmodels. If hundreds of people sing the praises of model A asbeing reliable while model B is said to break down weekly, it isworth a little extra to get model A. If you keep the car, say 5years, and you pay $1,000 more for model A now, you have toweigh that against the likely repair bills for all of the 5years if you had model B.* Carpool, take the bus or bike to work. With gas prices the waythey are, you'll save a bundle even before counting wear andtear on your car.* Get online with eBay. Don't throw things away, put them up forsale and see just how much others will pay for your old stuff.It may be clothes, tools, bikes, CDs or paintings - anythinggoes if the price is right. Shipping is on the buyer, soanything above zero is a gain for you.* Don't assume that all do-it-yourself projects are good.Compare the potential income you could have earned in the sametime, plus material, and see if it's equal or more than acontractor would cost. What good is saving $100 by doingsomething yourself if you could have worked an extra shift andearned $200 in the same amount of time? Then there are theissues of quality and risk. A house improvement project thatlooks like crud will bring down the value of your house, not theother way around. Likewise, if you're accident prone and plan onspending hours on an unsteady ladder while painting the house,you should consider your potential for lost income in case youtake a fall and break your arm.* You don't have to give up the foods you like to save money aslong as you go with generic store brands. It's easy to get stuckin the habit of going with the familiar package, but look at theingredients and you'll likely find that it's a carbon copy ofthe name-brand original - except the less glamorous package cost10-30% less. This goes for everything from soda to crackers.* Warehouse clubs can be great, but beware of buying stuff 'justbecause it's cheap'. Enter the store with a shopping list, don'tbuy more than you need, and compare packaging sizes - sometimesthat small box is cheaper than the big one!* When going on road-trips, do an Internet search to locatecheap but decent motels along your route and make note of theiraddress and phone numbers. Then you can call from the road andcheck vacancies to avoid panicked, last-minute check-ins at somehideously overpriced roachtrap because you have no options.* Plan your vacations for the off-season. Guess what, theBahamas are nice year-round. By scheduling vacations in theoff-season you get better hotel rates, better service and morebargaining power for anything you buy. And you'll avoid thecrowds, too. Save even more by flying out on a Saturday or otherlow-traffic period when airfares are low.You can find more information here:http://www.tradingideas4you.com/finance-money/finance/finance.html
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