You’ve undoubtedly seen those TV commercials where a guy is sitting around a table of children asking questions like, “is it better to get something now or something later.” Well, our question for today is, “is it better to be in debt or debt free?” If you’re typical, your answer was it’s better to be debt-free. The good news is that you could accomplish this in the year 2014 just by resolving to do some fairly simple things.
Get your finances organized
If you haven’t already done this, it’s important to make a list of your bills, your interest rates and how much you’re accumulating in interest charges. You should create a filing system and a budget. The reason why most people get into trouble is because they didn’t realize what was happening until it was too late. If you get organized and pay attention to your bills you can keep this from happening.
Set up automatic transfers
Why write checks every month, buy stamps and mail your bills when you could set up electronic bill pay? Your bank probably offers online banking tools such as sample budgets, calculators and the ability to pay your bills electronically. If not, you could get an app for your computer or smart phone that would do the job for you. You should also arrange for automatic transfers from your checking to your savings account every payday. If you don’t see the money, it’s less likely you’ll miss it.
Get a financial buddy
Find a friend or relative that would be willing to help you create a budget and stick to it. It’s a fact of life that you’re more likely to stay with your goals when you don’t want to disappoint the person who knows what they are.
The best time to go shopping is when you’re in a hurry. This is because the less time you spend in a store the fewer items you’ll probably put in your shopping cart. Also make a list of the things you need before you go shopping. Then stick to that list and buy nothing that’s not on it.
Make smart and reasonable resolutions
If you’re making resolutions for 2014, be smart about them. Be careful about resolutions such as “go on a nice vacation” or “lose 30 pounds. These can result in travel expenditures or the cost of a gym membership. When you’re writing down those new resolutions, choose ones that don’t put a dent in your wallet. Also make sure that they’re realistic. Your 2014 resolutions don’t have to be big ones. Think instead about those that would help you save money and that are reasonable, such as “bring lunch to work three times a week” or “put $25 extra a month into my credit card payment.”
If you find you are unable to pay off your credit card balances every month, you should definitely resolve to pay cash more often. There’s just something psychological that makes paying cash more difficult than using a credit card. For that matter, you probably shouldn’t take a credit card with you when you go shopping so that you won’t fall prey to temptation.
Tour your house
Take a tour of your home and look for ways that would save you money such as deciding to lower the temperature during the winter months or adding insulation. Did you know that every degree you lower the temperature in your home will save you as much as 5% on your monthly heating bill? It’s true and is an easy way to save money.
There are people who say you shouldn’t ever pay full price for anything and I definitely agree. There are coupons available that would save you money on everything from your groceries to a night on the town. Here are nine of the most popular coupon websites you should check out.
- Coupons.com (http://www.coupons.com/)
- Retail Me Not (http://www.retailmenot.com/)
- Groupon (http://www.groupon.com/app/subscriptions/new_zip?)
- Shop at home (http://www.shopathome.com/)
- Brad’s Deals (http://www.bradsdeals.com/)
- Slick Deals (http://slickdeals.net/)
- Coupon Cabin (http://www.couponcabin.com/)
- eBates (http://www.ebates.com/)
- Fat Wallet (http://www.fatwallet.com/)
Make small changes daily
You don’t have to make huge changes in order to pay down your debt. Sometimes just making small changes will get you where you want to be. You should write down a list of changes that you could make in your day-to-day routine that would save you money, then create incentives that would help you stick to them. Here are 12 changes you could make that would save you money you could then use to pay down your debts.
1. Shop and re-shop your auto and home policies – If you haven’t gotten competitive bids on your auto and homeowner’s insurance for the past couple of years, now would be an excellent time to do this. Insurance companies are as competitive as the auto companies. Shop around a bit and you’re likely to cut your premium substantially.
2. Have a massive garage sale – Get rid of all that stuff lying around the house that you either don’t need or aren’t using and turn it into cash. You might be surprised at how much money you could raise in just one single weekend.
3. Use a grocery store awards program to save on gas – Our supermarket has won our undying loyalty with its program that awards points we use to cut the cost of gas. We had enough points recently that we were able to fill up one of our vehicles for just $20. It was amazing!
4. Go to matinee movies – Many theaters price their afternoon movies cheaper than the same ones that run in the evening. You could see that new movie on a Saturday afternoon rather than Saturday night. It would be the same movie but the tickets should cost much less.
5. Get books and movies from the library – Our library offers books, CDs and movie DVDs you can check out for a week. The movies won’t be first run or maybe not even second run but you should be able to find classics and great family films. For example, next Christmas why not check out “A Christmas Story” or “National Lampoon’s Christmas Vacation” rather than buying the DVDs.
6. Plan your errands to save gas – Don’t do three errands in the morning and then another two in the afternoon. Group your errands to save gas. Start with the one that’s furthest away and then work your way back towards your house.
7. Call you utility companies and ask about a budget plan – Many utilities offer budget plans. The way these work is that they take your total billing for the past year, divide it by 12 and then bill you 1/12th of that amount every month. Yes, you probably will have a higher natural gas bill in the summer than you’re used to but your winter bills should be much smaller.
8. Use exercise videos and walk or hike instead of using a health club membership – A health club or gym membership can cost anywhere from $50 to several hundred dollars a month. If you belong to one of these clubs, you could cancel your membership, save the money and resolve to either use exercise videos or to just hike or walk to get your exercise. Most experts say that if your goal is to lose weight all you have to do is walk 30 minutes a day every day of the week.
9. Make extra dinner servings then eat them for lunch the next day – Instead of making dinner for two or four, double your servings and use the leftovers for either lunch or dinner the next day.
10. Buy your most expensive groceries – meat, cheese, paper products, etc. – in bulk
at Costco or Sam’s Club. You’ll get the same quality but at much lower prices. Paper products are especially good items to stock up on because they never go bad.
Pick just three or four
It could be a mistake to try to implement all 10 of these tips beginning in early January. Instead, pick three or four and start working on them. Once you feel that you have them mastered you could start working on another three or four, etc.