2016 is almost here making this a great time to assess how you could improve your finances next year. In most cases, the simplest answer is to find ways to stretch your money – just a bit further. Of course, there is no clear-cut answer to how you would do this. However, eight experts were recently asked the question of what are the best ways to stretch your money and here were their answers.
#1. Stretch your money by investing it
The best-selling author, Robert Kiyosoki, advises that the best way to stretch your dollars is through investing. According to the quote from a GoBankingRates.com article, you have to invest your money to make it work for you. He wrote the best-selling personal finance book of all time, “Rich Dad Poor Dad.” What he pointed out is that the important thing is to put your money to work for you instead of you spending all of your life working for your money. Smart investing in well-performing stocks and bonds can, over time, create a sizable nest egg, which would help you get more out of your finances. However, most experts say its best to not try to choose those stocks on your own but to put your money instead into mutual or Index fund. The stock market is extremely volatile and unless you’re a brilliant stock picker it’s better to invest in funds that are managed by people that do this full time and are experts in the market.
#2. Pay with cash whenever you can
Now that in many cases you can simply waive your smart phone to pay for things it may seem very passé to use cash instead. However, Clark Howard of “The Clark Howard Radio Show” advises that you to do this as much as you can. This may mean using the envelope method of budgeting, which is where you have envelopes with each labeled with one of your spending categories such as entertainment, groceries, eating out, clothing and so forth. He says if you use this system then you’ll have exactly the right amount of money in each of your envelopes for each of your spending categories and this can prevent you from going over budget. It will also keep you from accumulating too much credit card debt. This is bound to help you stretch your money.
#3. Freeze your spending
Nicole Lapin, news anchor, says that one good strategy is to go on a spending freeze with your spouse, partner or friends. You can learn all about it in a blog written on NicoleLapin.com, you could make saving more of a group effort by teaming up so, for example, when you go out for a night on the town you buy less expensive snacks and wine. She also suggests a “Biggest Debt Loser” contest with your friends. You can then share with each other how you’re reducing your costs, getting lower cell phone bills or better interest rates.
#4. Maximize your opportunities for saving
Jeanette Pavin is a financial reporter and author who has much experience helping people make their dollars go further. “Always look for a way to save and don’t let saving opportunities pass you by,” she advises. Whenever you’re about to make a purchase first look for a coupon or coupon code. She says that she rarely buys anything without applying for some kind of savings. She suggests you start by getting a rewards credit card that offers bonuses on gas and grocery purchases. When you have this type of card than buying something as simple as a tank of gas creates the opportunity to earn 2% cash back. She also uses her store loyalty card to earn discounts on the food she buys. There are an incredible number of opportunities out there to stretch your money, she says, and it generally requires only a little amount of effort to take advantage of them.
Whether you’re trying to get a raise at work or haggling over the price of a new car one proactive and successful way to stretch your dollars is by negotiating for a better rate. The best-selling financial author, Whitney Johnson, says, “Negotiate even when you think you shouldn’t.” It’s the old story that if you don’t ask you won’t get anything. If you ask you might be able to get an amazing deal. It’s possible to even negotiate recurring expenses such as your cell phone bill or even your monthly rent. We recently contacted our cable provider, told the customer service rep that on the 19th of the month we were switching to a competitor that would give us all the same services for $80 less. She immediately meet that price so for the next two years we will be saving about $70 a month or a cool total of $1680.
Negotiating sometimes takes time and effort but you’ll be happy you went to the trouble when the savings start adding up.
You’re probably familiar with coupons but it’s much easier to save money when you learn how to stack discounts. Kyle Taylor, founder of the website ThePennyHoarder.com, advises that one of the best ways to save money is in your grocery shopping. The best way you do this is to visit discounted gift card sites like Raise.com where cards can be purchased for as much as 25% below their face value. This can help you save money before you ever set foot in your favorite supermarket. Then stack your savings in tandem with your regular coupons and grocery rebate apps such as ibotta and Checkout 51. If you do these things every time you go food shopping you may be able to reduce your grocery bills by more than 50%.
#7. Maintain a cash flow
You won’t have to stretch your dollars if you always have a consistent cash flow is the advice of Josh Felber who is a career coach, entrepreneur, author and winner of the 2014 Best Money Expert award. His suggestion is that you compare your savings to your spending and always work towards spending less than you earn. While this may seem difficult it can be as easy as making a list of your wants vs. your needs and long-term financial goals. Then eliminate as many of the wants as possible so you will be curbing your spending on unnecessary or frivolous purchases. In turn, this will leave you with more money to free up your budget.
#8. Always watch your spending
Tony Robbins the life coach and motivational speaker says that to get the most value out of your money you need to spend it on valuable things. “The key to stretching the value of a dollar,” he says, “is to spend on things that dramatically increase the quality of your life. The short way to put this according to Robbins is to focus on the returns that you’ll earn tomorrow. He further says you can often have the same level of enjoyment if not more by doing something simple. For example, next time you want to spend an evening with friends, don’t go out for dinner at a cost of maybe $50. Instead, order in a couple of pizzas and beers and split the cost among the group. You’ve traded one good time for another, and you’ll save about $40 each time you do this. Do the math every time you save a little money. For example, if you save that $40 a week, you’ll save about $2000 each year. And with the help of compounding interest you could get big, big gains over time. In fact, if you save that $40 weekly at a compounding interest of 8% then after forty years you’d have nearly $580,000.