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Wednesday, February 20, 2013

Save because you can

Save because you can

There are many good reasons to save money or resources.  There are two main reasons why you should save money.
1.       Because you need to   

2.       Because you can
If you are struggling with your finances, you need to save money and that is reason number 1.  You are going deeper every day that you don’t take action.  You could even say that common sense dictates that you take corrective action immediately.  Unless there is some unusual or even expected windfall in your near future, such as income tax refund, inheritance, job promotion or even pay raise that will change the dynamics, action is dictated as soon as possible.

Ways to cut your expenses might include, getting rid of your gas guzzler car, cutting off or reducing the amount of cable service you presently pay for, reducing the type of cell phone service you presently pay for (going from a smart phone that requires a data plan to a basic cell phone).  The examples go on and on, another common example might be reducing or cancelling your fitness center membership and joining a group of people that walk or run for exercise, even god forbid reduce your habit from two or more Lattes to one a day.  If you are buying your home and you haven’t refinanced in the last 3 or 4 years you may find that to be a life changer (with present low rates you could save as much as $400 per month).

The next reason is one that my wife and I regularly discuss and take action on approximately every three months.  Save money because you can.  I am not bragging that we can afford to be foolish and throw away money but that is exactly what we would be doing if we continued being unaware.  The following are great example of how you can save money and how others have recently realized savings by being aware.
One of my sons recently had a conversation with me about how he was paying way too much for Internet and cable service.  He mentioned that his cost was well in excess of $200 dollars per month.  He was considering t cancelling the service.  I recommended that he call the cable provider and tell them that his bill was so excessive that he was considering leaving and contracting with the competition.  He had been a customer for a very long time, and they didn’t want to lose him.  They discussed his service needs and negotiated a new arrangement where he gets exactly what he wants and needs for a very small fee of $69 per month plus tax, on a two year signed contract.
Another major area is your car insurance.  The last time I shopped for automobile insurance I saved over $500 dollars per year.  The secret was to include my Home Owner’s Insurance Policy on the same package of coverage.  Another factor was to look at my deductible and increase it to a level that I was comfortable with.  I know people that have deductibles as low as $200 dollars.  How many repairs do you know that can be performed to your automobile for under $200?  In the area of deductibles more often than not your level is controlled by the type of bank finance and luxury level of your auto.  For example any kind of vehicle lease requires a $1000.00 deductible, and most insurance companies will require you to maintain the higher deductible across your coverage even if your second vehicle is already paid for.  Your costs for insurance is lower the higher deductible you pay.  We still shop and compare insurance premiums every three or four years, because the insurance companies will slowly raise your premiums to get more money from you as time goes on (it’s simply the nature of the business).
Other external factors that will affect your premiums, are your driving record, and with some companies even your credit rating.  The idea of enjoying life at 50 and beyond is made better by watching over your hard earned money.  Someone once said; that if you watch the pennies, the dollars will take care of themselves.  Do you have any tips or perhaps other ways that we can share about saving money.  It’d be nice not to take it to the level of trading Gold on margin, or buying and selling Stocks at the best possible time.  Maximizing your resources is always one way to get more fun out of life.  The best is yet to come….

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