Thursday, December 30, 2010

10 easy ways to save money

There are so many little things we can do to save money without much effort. Some things simply require a phone call or two but can save you hundreds.

1.) Go over your banking

Check your bank details such as monthly fees, interest rates, late payment fees etc... to see if you are getting the best deal. I had a friend who regularly paid $120+ a month in various bank fees. She had a monthly account keeping fee, a withdrawal fee, overdrawn fees, basically you name it she paid a fee for it. I asked her why she had never looked at changing banks or rang to question the fees. Her response “Oh, I never thought to do that!”

Not checking her banking or looking for a better deal was costing her upwards of $1440 a year! And even after we discussed this, she did nothing to change it.

2.) Get rid of automatic renewals

I got an email recently about an automatic renewal for $80 for a program I no longer use or need. I did not even realise when I bought the product a year ago it had automatic renewal. I am lucky I was emailed and informed they would be taking the money out in 5 days. I was able to contact them, change it and now do not have an automatic renewal.

There are many things out there with this feature. Cancel them if you do not need them or it will be money down the drain. Magazine subscriptions are great at automatic renewals!

3.) Learn to negotiate/haggle

In many countries they haggle for everything. It seems we in Australia feel uncomfortable doing so. There are some things we haggle on such as buying a car, buying a house, possibly the TV or other electrical items. It seems we think it is acceptable on large items but not smaller items.

You can get discounts on things as small as your groceries if you just ask. If you see something near its expiry date, or 1 of 12 eggs is broken or you are buying an item in bulk ask if they will discount it. Most of the time they will say yes.

Often we find it embarrassing to ask or are scared of them saying no, but you could save hundreds, even thousands a year.

4.) Lose the memberships

Most of us have memberships of some sort we don’t use or really need. Gyms make a fortune off people signing up, using it a few times and then just not cancelling the membership. If you aren’t using it or don’t need it ditch it.

5.) Eat healthier

Switching from fatty, sugary foods can be hard, but taking it one step at a time can make it easier. Try having fruit as a snack instead of a snack bar or chips, or switch from fizzy drink to cordial then eventually water. I recently wrote here about how health and money go hand in hand.

6.) Try natural medicine first

Natural medicine works for lots of things it is simply a matter of researching and knowledge. My in laws spend a fortune every winter on cough and cold products. Everyone always seems to be sick and it has been scientifically proven those syrups do nothing. Yet they continue to spend $10 - $20 a week on the stuff. Not to mention the cost of doctors visits.

I read a while ago about the benefits of crushed garlic and vitamin C to fight infections. We have crushed garlic in various meals throughout winter and eat more oranges and kiwi fruit. As a result we do not get sick as often as my in laws and recover much quicker when we do.

I am not saying self diagnose all the time. I am just saying that many simple illnesses can be cured much quicker, easier and cheaper with natural remedies.

7.) Stop speeding

Besides the fact speeding can kill you and anyone else for that matter it can cost a pretty penny. Not obeying the speed limit, running stop signs, parking in no parking zones, you know all the things we know are illegal yet so many still do can add up.

Many fines are in the hundreds. I know of people who have paid thousands of dollars in speeding fines alone. If you ‘need to speed’ because you are late, maybe you should be more organised so you don’t ‘need to speed”.

8.) Late fees

These can be a killer. You can get charged late fees on telephone, water, electricity or any other bill, DVD and other hire, credit card or other loan repayments etc... Basically anything you are supposed to pay you can get lumped with a hefty fee for not paying within the right time frame.

If you just do not have the money to pay the bill instead of getting a late fee, call the company before the due date and request an extension. Most of the time they are very willing to grant it because it shows you are willing to pay and they have an idea of when they are going to get their money.

I have seen on my bills late fees range from $5 to $10 of the bill per day it is not paid (that’s a government one!) So late fees can get very expensive very quickly and they add more the longer you don’t pay up.

9.) Get rid of the credit card

Back before credit cards people simple saved until they could afford whatever it was they wanted. Now credit is so easy to get it is dangerous for many people. I know of so many people getting in over their heads because the bank was willing to up their limit and they accepted it.

If you know how to manage your credit card it can be a very useful tool. You need to be disciplined and pay it back in time every time. You can get reward points this way and have 55 days to earn interest on your money before paying the bill. Most people do not use them this way.

If you aren’t disciplined don’t have one.

10.) Look for a better deal

This can be done online or through a few phone calls. Check everything you have such as house insurance, car insurance, mortgage, internet or mobile phone plans and see if there is a better deal out there. If there is you can see if your current provider will match or better it, if not switch.

It’s not hard and doesn’t need to take long but can save you a lot. I saved $2500 on a few occasions checking car insurance and over $1,000 on home insurance. It took about 20 minutes to compare and call them, but it was worth it.

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