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5 Mind Tricks To Help Keep More Money In Your Pockets

5 Mind Tricks To Help Keep More Money In Your Pockets

Money, it’s a gas. Or, at least, it runs out as fast as gas does. If you’re living paycheck to paycheck, it can be incredibly hard to start up the nest egg you’ve been planning for years. But it’s not impossible. With a few tweaks to your daily spending habits, you’ll find you have more than just spare change in your pockets by Friday evening. If you want to save money, read on.

1. Think of hourly worth

When I was a young adult working at a summer camp, I was always amazed when most of my coworkers would come in with a fresh deli-made bagel, bottle of orange juice, and cup of coffee every morning. We only made around $10 an hour, so those that made this a daily habit had already spent the money they would make in their first hour of every workday before they even got to work.

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If you want to save money, quit the impulse purchases. Every time you want to buy something, think to yourself “How much time would I need to work to pay for this?” If the amount of time absolutely appalls you, put the item back on the shelf and move on.

2. Savor things and experiences

If you add up your daily $3 Starbucks coffee habit over the course of a year, you might be shocked to realize you’re spending anywhere from $700 to $1000 yearly on a drink that lasts you twenty minutes. Your first impulse would be to stop buying the coffee altogether. But what’s the point of living if you can’t enjoy yourself every once in a while? Instead of making it a habit, cut down to once or twice a week. Save your “coffee day” for the rough mornings, rather than getting it all the time because it’s what you normally do. You’ll end up enjoying every sip you take just that much more, knowing you won’t be allowing yourself to have another one until the following week.

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3. Think of time off as lost money

If your boss offers overtime, take it. Chances are you just wanted to go home and relax on the couch for the evening anyway. If you make $15 an hour and get double-time for working longer hours, and your boss offers you two extra hours of work, is it really worth losing $60 to catch the Seinfeld reruns you’ve seen a hundred times? You might not have technically lost any money, but you lost potential money. It’s one thing to have missed opportunities in the past, but to disregard future opportunities that you still have the chance to take advantage of is a complete waste.

4. Spend where it matters

Money is essentially meaningless until you give it meaning. If you have a million dollars in the bank but refuse to touch it, it’s just a number on the computer. But if you have $100 in your pocket and spend it on a romantic dinner with your wife, you’ve spent $100 not just on dinner, but on making a memory that will last long after you finish dessert. A dollar might not go as far as it used to, but since you are free to do with your money as you please, make the most of every penny you earn.

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5. Think of money saved as money earned

Going back to the idea of not spending habitually and splurging on unnecessary items, change the way you think of money saved. It’s one thing to say you “saved” $500 this year by not buying a donut every morning, but you could also look at it as you “earned” $500 this year by not buying a donut every morning. It might not seem like it, but didn’t it take effort to give up that sweet pick-me-up? You were working to give up the habit you had formed, and for your troubles, you earned some extra money in your pocket. Think of how much money smokers could earn if they gave up the disgusting habit! Once you earn this money by giving up something fairly inconsequential, you’ll be free to spend it on the things in your life that actually matter.

Featured photo credit: Flickr via farm8.staticflickr.com

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Last Updated on March 4, 2019

How to Use Credit Cards While Staying Out of Debt

How to Use Credit Cards While Staying Out of Debt

Many people will suggest that the best thing to do with your credit cards during these tough economic times is to cut them up with a pair of scissors. Indeed, if you are already in huge debt, you probably should stop using them and begin a payback strategy immediately. However, if you are not currently in trouble with your credit cards, there are wise ways to use them.

I happen to really love my credit cards so I will share with you my approach to how I use mine without getting into deep financial trouble.

Ever since about 1983 when I got my first Visa card, I continue to charge as many of my purchases as possible on credit. Everything from gas, groceries and monthly payments for services like my cable and home security monitoring are charged on credit. Despite my heavy usage, I have maintained the joy of never paying any interest fees at all on any of my credit cards.

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Here are some tips on how best to use your credit cards without falling into the trap of paying those nasty double-digit interest fees.

Do Not Treat Credit Cards as Your Funding Sources

Too many people treat their credit cards as funding sources for major purchases. Do not do this if you want to stay out of trouble. I use my credit cards as convenient financial instruments so I do not have to carry around much cash. In fact, I hate carrying cash, especially coins. When you buy things on credit, the purchases are clean and you will not get annoying coins back as change.

I do not rely on my Visa, MasterCard or American Express to fund any of my purchases, large or small. This brings me to my golden rule when it comes to whether I will pull out any of my credit cards either at a retail or online store.

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I never purchase anything with my credit cards if I do not have the actual cash on hand in my bank account.

If I really cannot pay for the item or service with cash that I already have at the bank, then I simply will not make the purchase. Remember, my credit cards are not used as funding sources. They are just convenient alternatives to actual cash in my pocket.

Make Sure to Always Pay Off Balances in Full Each Month

The next very important part of my overall strategy is to make absolutely sure that I pay the balances in full each and every month no matter how large they are. This should never be a problem if the cash has been budgeted for my purchases and secured in the bank. I have always paid my full balances each month ever since my very first credit card and this is why I never pay interest charges.

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Using Credit Cards with Rewards

Most of my credit cards are of the “no annual fees” type, including one MasterCard on a separate account I keep at home as a spare in case I lose my wallet or incur any fraudulent charges. However, I do use a main Visa card which does have an annual fee because all purchases on that card reward me with airline frequent flyer points. For me, the annual fee is worth it since I do travel and I get enough points to redeem many free flights.

You have to decide for yourself if you will charge enough purchases on credit each year without paying interest charges to warrant a credit card that rewards you with airline points (or other rewards). In my case, the answer is “yes” but that might not be the case for you.

I occasionally use a MasterCard or American Express card on small purchases just to keep those accounts active. Also, I have been to the odd retailer that accepted only a certain type of credit card, so I find that having one from each major company is quite handy. Aside from my main Visa card which earns the airline points, the rest of my cards are of the “no annual fees” variety.

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So this is how I use my credit cards without getting into any financial trouble with them. This strategy is recommended only if you are not in debt, of course. In fact, it is worth keeping in mind once you’re out of debt so that you can keep your credit cards active and treat them responsibly.

What are your credit card usage strategies? Let me know in the comments — I’d love to hear what methods you use.

Featured photo credit: Artem Bali via unsplash.com

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