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5 Simple Ideas To Save Money Right Now

5 Simple Ideas To Save Money Right Now

Although budgets can feel restrictive when spending, they remain one of the best ways to keep your finances under control. You can save more and avoid living outside your means, minimizing your chances of suffering financial distress.

However, knowing how important it is to stay on a budget is not enough; depriving yourself and your family, gathering every penny and tracking every expense down to the last cent, will tire you out eventually. This phenomenon, called budget burnout, is enough to get you off track, but luckily there are a few things that can help you defeat burnout.

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1. Upgrade Your System

Perhaps the system you are accustomed to using has worked well for you in the past, but it has now started to consume too much of your time and attention. I’ve had similar experiences, so I understand how close it gets you to giving up. However, this shouldn’t avert you from budgeting; it’s a just a sign that you need to move to a better solution.

To give you an example, I followed the envelope system for two years. Although it gave results, I ultimately got sick of having to fill envelopes with money every other week. What’s more, I seemed to always leave the envelopes at home when going for groceries, so I was charging my credit card in the end. I tried to amend these problems by depositing all my cash to my bank account, only to find out that I wasn’t patient enough to monitor each individual debit card transaction; moreover, I was more likely to spend more money this way.

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What I do know is to use a prepaid debit card which I load each month with what’s needed for gas, groceries, recreation and any other expenses that may come up, and leave the rest in the bank. Our expenses are strictly paid from our checking account and since our bills are automatically taken care of, it has become easier to maintain the budget plan.

2. Ask for discounts.

According to Janice Lieberman, author of ‘Tricks of the Trade: A Consumer Survival Guide’ and ‘How to Shop for a Husband’, and contributing editor to Reader’s Digest, in the current financial climate, companies are willing to give their customers a discount. However, they won’t do it by themselves, so you have to ask for one. Don’t go overboard, think of a fair price and go for it. If you are denied, ask to speak to the manager and explain your situation. More often than not, you will eventually get your break.

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3. Be patient.

For the next month, vow to yourself that you will abstain from making any major purchases without waiting 24 hours first. When you spot something you want, ask the store employee to keep it for you for one day. If the next day comes and you still want it, then go for it. This rule works with any good (gadget, shoes, chocolate) and it is a true money saver.

4. Draw motivation from your friends.

It is a common theme among budgeters to practice saving as a group. When you express your savings goals and your purpose behind them (e.g., house deposit, wedding, or even a donation to a charity), you are able to save more, and in less time, because family and friends will support you. You can use social media to share your financial goals with people you care about.

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5. Always check prices.

Spontaneous buying is a mistake that is all too common, as it’s almost certain that you are not getting the lowest possible price. Instead of buying hastily, do a bit of homework first. You can check price comparison sites. For bigger purchases that need more thought, like cars, use a site like Car Buyers Edge for example, which empowers users with inside knowledge of all rebates, incentives and dealer hold backs they are entitled to.

Featured photo credit: Viktor Hanacek via picjumbo.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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