Week 5: Congress Can't Do It, You Can: Top Ways to Slash Your Spending & Expenses
It's hard to believe that January is almost over... and we are now already to Week 5 of the Personal Finance Resolution. This week we are covering a topic that everyone can relate to and get something out of: Reducing Spending & Expenses.
Be sure to check out weeks 1-4 below if you missed them:Week 1: Assessing Your Current Financial Health
Week 2: Setting Up a Budget
Week 3: Establishing Financial Goals
Week 4: How to Get Out of Personal Debt...For Good!
Now on to the topic for Week 5:
Reducing Your Spending & Expenses:
This week's Activities for Success:1) Find 3 ways to reduce your monthly spending and expenses
2) Make a plan for what to do with the money that you save
Useful Articles"How Can I Reduce My Spending?"
"Budgeting and Saving: The Age-Old Dilemma"
This week's Personal Finance topic revolves around reducing your spending and expenses to make the most out of the money that you bring home each month.
Rather than have you fill out a calculator or expense reduction plan this week, we are going to show you 15 possible ways to save money and let you decide which would help you the most.
1) Take a look at your cell phone plan - If you are consistently under the minutes that you pay for, try reducing the plan to a less expensive one.
2) Buy in bulk - For the staples that your family uses all the time (paper towels, canned food, meats/poultry,etc.), buy in bulk if possible. You'll start to see savings almost immediately.
3) Eat out less - Not only is a home-cooked meal more likely healthier for you, it is also probably much less expensive. Eating out just two less times per month can easily save you upwards of $50.
4) Unplug electronic devices you aren't using - Leaving electronics plugged in- like cell phone chargers, coffee pots, game systems, and laptop chargers- can eat up a lot of energy. Each item that you unplug when not using can save you over $1 per month, which can really add up.
5) Use refillable water bottles - Spending $1.50 on a bottle of water each day or each time you go to the gym can really add up. Look at buying a filtration pitcher that can be used to fill a reusable water bottle each day.
6) Make your coffee at home - Don't waste $2-$3 per day on coffee- making it yourself will cost less than 1/3 of that!
7) Shop around for a bank - If you're getting hit with monthly fees- switch!
8) Look into refinancing your loans - It can't hurt to try, but refinancing a mortgage, student, or auto loan could save you thousands over the life of the loan.
9) Shop around for auto and home insurance - Depending on several factors, you may be paying more than you need to for these, especially if you haven't switched in a few years. Make some calls to see if you can find a better deal without reducing your coverage.
10) Call your credit card company and ask for a lower APR - As we discussed last week, you shouldn't have any credit card debt. But if you do, calling and asking for a lower interest rate may work in saving you money.
11) Check out your cable package - Do you really need to spend $20 extra per month for that movie channel you rarely watch?
12) Shopping - Do less of it. Ask yourself if you really need that new shirt or DVD.
13) Home heating and cooling - Try keeping your thermostat at 70-72 degrees, rather than moving it up and down with the seasons.
14) Gym memberships - We all know that it's important to exercise, but some of our users have reported spending upwards of $50 per month on a gym membership. Shop around and your should easily be able to cut that number in half.
15) Vacations- They're fun, we all love them, but try taking one big vacation each year rather than two or three smaller ones. The savings can really add up.
The most important decision to make this week is what to do with the money that you will be saving each month. We recommend (in order):
1. Pay off any credit card debt that you have
2. Add to your savings until you have saved at least 8 times your monthly expenses
3. Contribute to a retirement account
This week's Activities for Success:1. Find 3 ways to reduce your monthly spending and expenses
2. Make a plan for what to do with the money that you save
Terms Used in this Issue:
Annual Percentage Rate
Stay tuned for next week's issue, which will cover Considering Investment Choices.