Wise Uses for Credit
Credit cards, lines of credit, buying over time, and other delay-pay mechanisms are earning a pretty bad rep these days. But credit, by itself, isn’t a bad idea at all. Credit is what allows most of us to buy our homes, our cars, take better vacations, and purchase other big-ticket items we’d rather not do without until we have enough cash in the bank to pay for them. And most of us are okay with paying a bit more for our purchases in order to have the convenience of owning them when we need them.
Building good credit and a strong credit history can reduce other costs. When your credit score is high, you can use it to bargain for better mortgage rates with your lending institution. And that alone can save you many thousands of dollars. You can do the same thing with your credit card lender. If you have great credit, call them up and ask for a lower rate-if they won’t give it to you, there are plenty of other credit vendors who will.
Good credit can also allow you to take advantage of long term no-interest loans that allow you to purchase appliances and other large household items without paying a cent-sometimes for up to 18 months. Good credit can get you 0% interest over 5 years on a car loan-a huge savings. So a good credit reputation can give you lots of leverage when it comes to making costly purchases, and potentially save you a fortune on home or car mortgages or big appliance buys.
So if you’re good at using credit to your advantage, you can save all kinds of money by being able to take advantage of sales, long term no-interest offers and leveraging your good credit for lower interest rates.
The trouble with credit starts when it is used as a permanent income-extender for daily living, like buying groceries or paying the utility bills, and forgetting about ever paying off the balance. That’s when you can bet your credit use is out of control. A quick control check can reveal your own dependency. Leave your credit cards-and all other plastic-at home for 24 hours. Can you do it? If you discover that you’re reaching for plastic several times a day, chances are you’ve developed a bit of a credit card habit.
Break the habit by learning to leave the cards at home. It can be tough at first-addictions are hard to set aside. Start slowly, and, as they say-one day at a time. But, as they also say-just do it. Gradually, you’ll become accustomed to not carrying money or cards with you-and you’ll learn to live within your real means, without debt.
Ways to Save on Groceries
If we only didn’t have to eat at all, we could put a big chunk of change in the bank, and save ourselves a lot of time, too. But until we can get by without food at all, we can sure cut back on our expenses with a few money saving tips and a bit of frugal spending.
First, what’s in your fridge already? Knowing what’s there can help you save money by not buying duplicates and building meals around what you’ve already got at home. It’s often the strangest things in the cupboard that don’t get eaten-so go online and google pears-in-light-syrup and almonds and see what dinner items you might come up with. Then buy the complimentary ingredients and poof!-stewed pears in white wine. Serve it with sautéed asparagus with toasted almonds and a bit of tenderloin. Yum.
Put a price cap on your groceries. Don’t allow yourself to spend whatever you want. Determine a reasonable amount for your groceries-some estimates suggest about $40 per week per person. That will vary depending on where you live, of course, but it’s a good starting point. If you limit the money you spend, and track your spending as you shop, you can make cheaper choices so you don’t exceed what you allocate.
Price shop. Local corner stores compete with the big boys with at least one item that’s cheaper every week. Go in and get it-bananas at five cents a pound? You bet. Just don’t get sucked into buying anything else there-hit the big superstores where the cheapest prices and best selections can generally be found.
Look for no-name brands, and look down. It’s a war for aisle space in the supermarkets, and the losers get stuck on the lower shelves. That’s a win for you, of course, because now you know where to look for the cheapest prices and best bargains. So keep your eyes on your toes, and your nose to the floor.
Eat before you hit the supermarket. This might be a golden rule of food shopping. Never go to the grocery store hungry. Not only will you eat your way through the store, you’re much more likely to veer off your shopping list, overbuy on everything, and splurge on items your starving tummy is crying out for. So be sure to eat your Wheaties before you shop.
Use a shopping list. This will not only save you money at the store, but it will also save you money because you’ll know what you’re eating every day of the week. This helps avoid last minute impulse buys and pre-made dinners like pizza on your way home after work. It may even help your waistline because fast foods or instant foods are almost always higher calories than what you prepare from scratch at home.
Leave the kids at home. Taking kids to a shopping mart is the quintessential recipe for disaster-and overspending. And supermarkets know it. Every isle is filled with teaser items that just scream for little hands to reach out and touch, play, or eat, especially at the checkout counter. Leave the kids at home.
Only a few changes to your grocery-buying habits can result in huge savings at the supermarket that can add more mileage to your budget.
More Money In, Less Money Out
When it comes to saving money, there is more to consider than merely what we are able to put away each month. We also need to consider other factors such as late fees and user fees. Impulse buying and becoming too risky can also damage your savings. Here are a few details to consider that may help put a few extra dollars in your account.
One of the largest non-essential expenses we pay for each and every month is the convenience of having a bank account and using ATM machines. It is imperative to know what interest rate you are charged on your line of credit or how much your bank charges you each month to use your interact card. These fees can vary greatly from a few dollars a month to a few hundred dollars a month. If you do not know what you’re being charged to use these services, it’s important that you find out. Keep this convenient, but non-essential fee as low as possible each month.
We’ve all been warned about the dangers of impulse buying. If something is on sale, it is much easier to rationalize the purchase, which often means we’re buying items we just don’t need. If you find yourself considering an item only because it’s on sale, walk away and sleep on it. Most stores will hold an item without a payment for 24-hours. Either way, reconsider the purchase.
Another non-essential fee many people pay each month is interest on overdue bills. Are you someone who procrastinates because they just don’t get around to paying bills on time? Perhaps a $100 hit in credit card late fees will be an incentive to start making the payments on time. If you procrastinate and pay late each month, you can easily be wasting a few hundred dollars each and every month on late interest payments. Not only do credit card companies charge a substantial late fee, so do many other services such as cable or satellite companies, water and utilities, not to mention additional annual fees like property taxes and personal income tax. These late fees can easily cost you thousands of dollars a year.
If you are paying your bills on time and are saving money for your retirement, it is wise to diversify your savings in the way of an investment portfolio. Placing all your money in a safe investment or a low-yield investment may not bring you the return you hope for. It could be a wise idea to consider getting some professional advice when it comes to investments. Professional financial advice can offer great suggestions as to where to invest your money, as well as help avoid potential costly mistakes. Also investing in a good accountant can help you take advantage of the many tax breaks that you will be entitled to. Professional financial advice as well as tax planning can also help keep a substantial amount of money in your account.