You may be sitting on hundreds of extra dollars each month – without even knowing it. In today’s economy, that extra cash cushion could mean the difference between financial security and financial distress.
American consumers had amassed more than $972 billion in credit card debt at the close of 2008, according to the April 2009 Nilson Report. Monthly payments have crippled families and a stagnant job market is providing little hope for recovery.
Many people think the paycheck-to-paycheck lifestyle is their only option, yet it is possible to save more money on the same income. The lattes, dry cleaning bills, movie tickets and other small purchases we make throughout the month can accumulate into hundreds or even thousands of dollars. Simply adjusting your daily spending habits can free up this cash and allow you to pay down debts or save for an emergency.
To determine how much money you’re spending on a regular basis, visit our financial calculators page. The How Much Am I Spending? calculator will help you pinpoint areas where you may be overspending.
We’ve also compiled some of the most common budget blunders and offer suggestions to help you save:
- Technology Overload – Do you really need the latest cell phone release or is your current phone doing the job? Do you really need 30 additional movie channels? Much of the technology that consumes our daily lives is unnecessary and costly. Closely examine what’s essential while separating your needs and wants.
- Name Brands – Don’t pay extra money for a fancy label. Generic and name brand versions of popular groceries, drugs and household items often contain the exact same ingredients. Take the time to review the ingredients and compare costs before you buy.
- Dry Cleaning Expenses – Dry-clean-only clothing can cost hundreds of dollars over the life of the garments. You can significantly reduce dry cleaning charges by using do-it-yourself systems that work in a home dryer. Better yet, check clothing labels and avoid purchasing dry-clean-only clothes when possible.
- Carpool Groups – With gas prices on the rise, you can save time and money by carpooling to work, school or your children’s events. This can also prevent wear and tear to your vehicle, reducing maintenance costs over the long run.
- Dining Out – When you spend a few dollars at a time, it can be difficult to estimate the total impact on your budget. For instance, if you spend $3 on a coffee drink four times a week, the monthly total comes to $48, which is the equivalent of a monthly cable TV or Internet bill. Another major expenditure is lunch. Dining out four days a week at $10 a pop equates to $160 throughout the month. You can save money by taking your lunch to work or making coffee at home.