Tuesday, February 13, 2007

Money saving tips

So, one of my biggest goals this year is to minimize my debt (other than the impending mortgage) to zero on the credit cards (almost there!!!) and to $6k on my student loan (that loan doesn't worry me much - low payments and interest rate).

I ran across a statistic that kinda freaked me out. I don't remember specifics (and I'm not going to spend all day googling for it, haha), but what it basically said was that while the average U.S. family's income is at an all time high, so is our debt and the number of bankruptcies. How can we be making more money and still be in such awful debt? Well, ours is a materialistic society. We want bigger better faster shinier newer, when what we have does its job just fine. Watching "Cribs" and the E! channel and reading magazines gives us the impression that we should have all these extravagant things. It's just not true.

Spooky facts:

  • Average household credit card debt has increased 167% between 1990 and 2004
  • The rate of personal savings in the United States dipped below 0% for the first time since the great depression, hitting negative .5% in 2005
  • Approximately 96% of Americans will have to retire financially dependent on the government, family or charity, according to a 2003 study
  • According to a 2004 study, the number one cause of divorce is financial stress
So, I assume many of you are in the same place as we are, trying to rein in the spending and kill the debt monsters. And if financial strain can damage something as wonderful and important as your marriage, then it's definitely something to watch out for.

Frugality is not about depriving yourself, it's about choosing your luxuries and spending intelligently. Do I want to buy espresso/lunch out 5 times or do I want to go to a concert? Do we want ten nice dinners out, or do we want to spend the weekend in Vegas? Do I want to blow $150 shopping, or do I want to put it in savings for my vacation/ new furniture/ retirement/ new house/ cabin? Am I more relaxed when I have a bunch of shiny new things, or when I am free of credit card debt? Honestly, being debt free feels like a luxury. I can't wait to roll around in all my zero balance credit card statements. ;-)

There are, of course, major things you can do, but it seems to me that the best way is to plug all the little money leaks here and there - it adds up quickly! And so, after all that pontificating, here are some tips and links I've culled from the web and my experiences.

  • Log your spending. It helps to have a friend keep you accountable, like Dani and I are doing, but even just writing it down for yourself and reviewing it at the end of the week makes you more aware of where the heck your money went (me- knitting needles, Dani - Starbucks - haha)
  • Never go to the store without a list. When you're about to get in line, look through your basket - what is in there that wasn't on the list? Take it out! I know, it's nice, you've been good, and you deserve it, buuuut... Is that the best way to spend that money? You don't need it and it's just going to be one more thing to have to put away.
  • Buy secondhand when you can, but be objective. Don't buy tons of stuff "because it's such a great deal!" It's only a great deal if you love it (or love how it will look once you paint it, etc.), will truly use it, and it won't clutter up your closet or end up in your garage sale next Summer!
  • If you have a favorite store that you know you won't resist, at the beginning of the month buy a gift card for yourself. You can use that set amount throughout the month guilt-free because it's built into your budget. When it's used up, stop spending and wait until the next month starts to re-up. If you're really good one month and you have a leftover balance, roll it over and re-up like normal for when you have a really spendy month.
  • Organize and declutter your home. I've worked in a lot of garages, closets, pantries, etc., and I always see duplicates of things that people couldn't find so they bought another. When you cut away the excess and make all your things accessible and organized in an easy to use fashion you can save a lot of money by not buying doubles. Also, going through all your things objectively can really bring into focus how much stuff we all have, and how little of it we really need. I'll post organizing tips in the next week or two.
  • Make friends with a hairdresser and trade babysitting or other favors for hair cuts. ;-) (Lindsey, come back to the mainland and cut my hair!!!)
  • Beauty experts say it's better for your skin and hair to wash it every other day (this is really hard for me - I like my hair squeaky clean or I feel dirty, and not in the good way) - uses half as much shampoo, conditioner, and hot water.
  • Pack a lunch every night - it probably won't happen in the morning (if you're anything like Matt and I)! Much healthier than what you'll buy out, and will save you a bundle.
  • Get books, magazines, movies, audiobooks, and Cd's (I rip them to my computer - shhh!) from the library rather than buy them. (Some library websites will allow you to download audiobooks for free - a great way to entertain your brain while commuting)
  • Pay your car insurance six months at a time - they'll give you a huge discount
  • Don't buy payment protection plans or extended warranties
  • Do your homework before you make a purchase, and buy online when you can - just check for free shipping deals first! Also, if there's a minimum order and you only need a few things, see if a friend wants to combine purchases to make the minimum to get the free shipping.
  • Do online bill pay or automatic withdrawals - The average household gets 15 monthly bills, which adds up to $70.20 in stamps yearly. Every little bit adds up.
  • Carefully review all your bills and consider the expense and what you get out of it - odds are there are corners you can cut, downgrades that won't hurt, better quotes you can get (on insurance and whatnot), and maybe even cancel a service entirely.
  • It's only necessary to change your oil every 5,000 to 7,500 miles rather than the standard 3,000. Check your owner's manual for specific info.
  • Save wear and tear on your pajamas. Sleep nude! If your bedbuddy does the same, you'll stay nice and warm or nice and cool because your body temp can regulate itself easier.
  • Eat less meat
  • Downgrade your cable or go without - there are much better things to do with your evenings than watch TV (when you do want to veg, sign up with netflix and rent tons of movies for $10-20/ month - an added bonus of zero commercials!)
  • When you get together with friends, do something at someone's home rather than go out (make dinner, play games, work on a project together, perfect your bartending skills, BBQ) - consider potluck/ BYOB
  • When you do go out to dinner, drink water. A hard drink is usually $5-$8, soft drink is $2-4, and the average calories? A cocktail runs 150-780 calories (whoa!!!), avg. beer is 150, avg. wine is 125, avg. soda is 136 (Studies show that the leading source of calories is from drinks! A little juice, a little pop, a glass of wine... adds up). Same goes for appetizers and desserts - avg. price $3-12, avg. calories 250- 1270! So, think before you order and fatten your wallet as you trim your waist at the same time.
  • Join restaurant birthday clubs to get coupons for lots of free food (they don't need to be used on your B-Day). Tony Roma's gives you a free entree, dessert, and bottle of BBQ sauce with purchase of a second entree (IF you have the coupon), Alfy's gives you a free personal pizza, Cold Stone gives you free ice cream, and so on. Google around for your local chain restaurants and find out what you can get! Be sure to sign up everyone in your household. Yes, baby is only a year old, but you'll help them eat it! ;-) Of course, you have to go into the location to sign up, and that's how they get you.
  • For cheap entertainment, scout out your local parks and recreation website or newsletter, the newspaper's website, volunteer at your local theater in exchange for tickets, google for local events, and local search engines (like nwsource.com) for free or inexpensive events. Check the website of local museums/ theaters, etc. for free admission days or 'pay what you can" nights - most of them do this. The Seattle Art Museum is free the first Thursday of the month, Everett Children's Museum is free the first Friday of the month... Also, check out meetup.com for get-togethers of people with your interests. Always exciting to meet strangers!


Frugal Living

The Guide to Living Well

Better Budgeting

Debt Zapper

Check back from time to time, because I'll add new ideas as they come, and if you have an idea please post it in my comments (you can post without having an account) because I need all the help I can get! ;-)


*Dani* said...

I save about $30 a month making my own laundry soap. You can save $50 a month (or so) using cloth diapers if you have a child. You would save about $120 a month BREASTFEEDING if you have an infant (formula is damn expensive!!!)

My biggest downfalls are buying coffee and not eating at home. If I can make myself bring food and not buy coffee, I would literally save $100's a month. Working at it now!!! Will post more ideas as I think of them!!

Ann said...

I love reading your blog, it has become a weekly thing for me. Thank you so much for your tips on remodeling! Now, I could use some tips for organizing!! We have soooo much stuff and I don't know where it all came from, ahhh! Also, I clicked on some of your links and I would love some advice/recommendations on better/safe beauty products, like face wash, moisturizer, etc. You're the best, hope all is well.

*Dani* said...

Ooooh- Carly, you should do a post about decluttering. It's so much fun! (I'm a dork). You get to taking things to the thrift store and you just want to get rid of more and more and more!!! I honestly get the same rush I do when I shop. I've run out of things to get rid of though- hahaha!

Carly Fay said...

As far as beauty products go, I'm addicted to Usana right now. So expensive and you have to order from them directly (like Mary Kay) but oh my goodness so nice and all natural ingredients. I'm considering signing up to sell it so I can get a discount.

Thelma said...

This is great info to know.