7 Ways to Lower Your Fixed Monthly Expenses

August 20, 2018

Completely happy at their new placeCutting your expenses is a great way to almost instantly start saving more money. When considering cutting your expenses, it’s easy to think about the variable expenses that change each month like dining out, transportation, groceries, entertainment and so on.

However, there are various different ways to cut your fixed expenses which can prove to be more significant and make a big difference in the grand scheme of things.

The best part about cutting your fixed expenses is that you only have to do it once (instead of every month), then you can enjoy the benefits of being able to save more and have less of a financial burden.

Here are some real ways reduce 7 common fixed expenses.

1) Refinance Your Mortgage

A good rule of thumb is to not allow your total housing costs to exceed 30% of your income. While there’s nothing wrong with wanting to have a nice place to stay, you have to consider your other living expenses and how you’ll afford them as well.

If housing costs are too high, you should consider refinancing your mortgage. If rates are lower now than when you took out your mortgage, you may be able to save money by lowering your interest rate and/or your monthly mortgage payment.

Refinancing does come with some expenses attached like closing costs, fees etc. so make sure you compare offers and do the math to see if refinancing will actually help you lower your housing costs and allow you to save money over time as well.

2) Move to More Affordable Housing

If you don’t have a mortgage and still want to lower your housing costs, you could consider moving to a more affordable place. Moving can be a huge process though so it might not be worth it to you but again, calculate how much you could potentially save.

You don’t have to move far away either. When I moved to lower my housing expenses, I found a much better deal elsewhere but it was also in the same neighborhood so I didn’t have to go far. After it was all said and done, I only had to move once and I saved a ton of money by doing so.

If you’re not interested in moving, you can always get a roommate to lower your housing expenses, or rent out part of your house if you’re allowed.

3) Ask Your Internet Provider for a Discount

Sometimes it doesn’t hurt to ask for a discount. If you use the internet a lot and want to try a new company, be sure to ask if they have any introductory promotions that you can take advantage of to lower your bill.

If you’ve been a customer for a while, see if the company will offer you a discount based on your customer loyalty and the fact that you’ve continued to pay your bill on time.

Some companies raise their prices over time which I don’t think is fair, but I always call and ask for them to lower the rates again. I compare the costs with other companies and ask for a discount based on what the competition is saying.

If you do this, odds are, you will receive some type of discount on your bill because your internet provider would rather you stay with them than go with another company.

4) Compare Insurance Rates

How much is your insurance costing you each month and what benefits is your plan providing you with? It’s best to compare insurance rates every now and then to make sure you’re getting the best deal.

After you’ve been with an insurance provider for a few years, they don’t really have much of an incentive to keep offering you the lowest rate. This is why there’s no shame and choosing a different insurance company if they will provide you with the benefits you need at an affordable rate.

You can also see if you can get a discount by bundling your insurance packages as well. I have auto and insurance and renter’s insurance with the same company and they offer me a discount as a result.

5) Get a New Cell Phone Provider

If you’re still paying a crazy amount for your cell phone bill, it’s time to start looking at other options. I’m not a fan of getting locked into 2-year contracts because I like to be able to change carriers if I find a better deal.

Many prepaid cell phone companies have been improving their service over the past few years and offering unlimited talk and text plans so there really isn’t a major reason to sign up for a contract with a large well-known company.

I’ve had Republic Wireless for about 2 years now and I really like the service and the price. I only pay about $30 per month for my cell phone bill for my smartphone. I’ve also had Straight Talk and I’ve also heard that Net10 and Boost Mobile are really good too.

6) Get Rid of Cable

If you haven’t already, be sure to get rid of cable this year. There are so many other more affordable options you can take advantage of so there’s really no need to have a cable bill anymore.

According to The Motley Fool, the average American pays $64.41 a month for expanded basic cable but many people admit to paying $150 or more per month for their cable services.

Needless to say, there are much cheaper alternatives to help you save money including streaming services like Netflix, Hulu, Amazon Prime, Sling TV and more.

You can also rent movies and television shows at the library or use YouTube for free. If you’re not yet ready to cut the cord, you could always ask your cable service provider if you can downgrade your service but think about what you could do with an extra $1,000-$1,800+ annually if you got rid of cable once and for all.

7) Refinance Your Student Loans

With $1.3 trillion in outstanding student loan debt in the United States, many feel the impact of their student loan payments dragging down their finances month-after-month. DC and his wife graduated with $100k in student loans and it largely was the motivating factor behind his website and book.

Because of how much student loan debt there is in the United States, there are companies like SoFi that offer student loan refinancing. They are willing to refinance all your debt at a lower interest rate so that you can save potentially thousands of dollars that otherwise would have gone towards interest.

This can be a great option for people who are looking to pay off their student loans faster and/or are looking to put less towards interest and more towards the balance of their student loans.

The Key to Cutting Fixed Costs: Focus on Shopping Around

Shopping around and comparing prices is one of the best strategies to implement when you’re trying to lower some of your fixed expenses.

Since fixed expenses are constant, it’s pretty easy to get comfortable with them year after year and forget about trying to get the most bang for your buck.

Switching your cell phone provider or refinancing your mortgage make a big impact on your finances allowing you to spend less and save more.

Whenever you can, lowering the interest rate on your debt you are going to save money. For many people interest rates are what keeps them in debt, especially when it comes to high-interest debt like credit cards. With so much going towards the interest on debt it can be tough to find the money to put towards the balance. Shopping around for lower interest rates can be a big win from a fixed-cost perspective.

Finally, one of the big benefits of renting instead of owning a home is that you are not as tied down to the property. Even better is that in many metro areas there are hundreds or thousands of options for places to live. If you currently rent, do yourself a favor and shop around before you sign that lease renewal.

 

Source: YoungAdultMoney.com

How to Get Through Back to School Shopping on a Budget

Schoolgirl with father buying school supplies in stationery shopInternships are coming to an end, blockbuster movies are in their final few weeks at cinemas, and slowly but surely people are beginning to pack up their pineapple floaties. It’s officially mid-August, which means summer is slowing down, and school is back in session.

Whether you’re in your final years of high school, or beginning your first year of grad school in a new city, there is something about this time of year that makes people want to shop, shop, and shop. According to the National Retail Federation, total back to school spending for K-12 schools and college combined is projected to reach $82.8 billion, nearly as high as last year’s $83.6 billion.

Don’t be a statistic of this season’s shopping spree. Follow these 4 rules when doing your back to school shopping that will help keep your wallet dent- AND debt-free!

Make Your List, Check it Twice

Whatever you are about to shop for, there’s always one thing you should do first: determine your actual, needs, not just your wants. Maybe it’s a new backpack, calculator, or tennis shoes; spend on those items first, and plan on budgeting for the rest later in the year. Unless you’re going away to school in Alaska, chances are you don’t need a winter coat or boots for the first few weeks of school. It’s tempting to get all of your shopping out of the way while the racks are full of gear, but you are more likely to get a bargain on that adorable new coat when it goes on sale before the holidays.

Once you have developed a ‘needs’ list, shop in your own house before you head to the store. Take your list around your house and look through what you already have and might be able to reuse. It’s likely your junk drawers and closets are full of common back to school items like highlighters, pencils, pens, calculators, and notebook paper. While it’s fun to have brand-new school supplies and clothes in the beginning of the school year, the savings you will see from shopping in your own home first are significant. Plus, you may find that old 90s denim skirt is back in style!

Budget, Budget, Budget and…. Budget!

Now that you have saved some money by going through what you already have, it’s time to create a budget. Whether you use the old-fashioned way with pen and paper or use an app like Mint, have a clear budget and stick to it. If you’re armed with a shopping list and a budget, you’re much less likely to succumb to impulse buys like the tricked out Swell water bottle, or the pricey Lilly Pulitzer planner. Skip the unnecessary, fancy stuff. You’ll save a ton of money if you buy plain, generic school supplies and save the flash for another time.

Meet ‘Sale’ + ‘Coupon’ – Your Two New BFFs

You can do it, just put your time into it! Coupon finding and sale searching is time intensive, but time is money, and you are saving it! Visit a drugstore or office supply store to buy notebooks, pens, and other supplies where the prices are college-student-friendly.

And don’t forget discount apps, such as Target’s Cartwheel app, that offer coupons for in-store purchases, as well as credit cards that offer rewards like cash back. While you shouldn’t be opening any new credit cards just for back to school shopping, use your preexisting ones wisely! Whether you prefer points for travel or retailer-specific credit cards, don’t be afraid to take advantage of a good deal. You can also find coupons in your newspaper or via apps and online sources such as Coupons.com and RetailMeNot.

Also, don’t feel the need to start shopping too early. According to Deloitte, about two-thirds of shoppers (62 percent) people who start shopping sooner in the late summer spend about $100 more than shoppers who get a later start.

Go Online, It’ll Save You Time

Instead of buying textbooks at the university bookstore where prices tend to be inflated, consider renting textbooks through Amazon or another service, at a fraction of the price. Not only will you be able to efficiently compare prices by going online, but you are more likely to stick to your shopping list.

ALWAYS check prices online before you buy anything in the store. Apps like Price Comparison Shopping and ShopSavvy make it easy. Just open the app, scan the barcode of whatever you’re thinking of buying, and you’ll automatically see available online prices. And don’t forget to check retailers’ websites. Many big retailers offer online-only specials.

These tools will help you finish the overwhelming (and fun!) task of back to school shopping while staying smart with your spending. Saving money is possible, and if you get sidetracked, just remember to clearly define your list and stick. to. your. budget!

 

Source: MintLife.com

Saving Money for Single Parents

August 14, 2018

Mother with kidsRaising kids is no easy feat. And if you’re doing it alone as a single parent? That is completely admirable.

There’s no doubt that handling finances as a single parent is a major challenge. But one major plus of handling finances alone is that you make all of the financial decisions. There is no bickering or comparing budgets.

Still, keeping your family’s finances healthy as a single parent is no easy task. In fact, according to a recent report by the U.S. Department of Agriculture, the average cost of raising a child from birth to the age of 18 is $233,610. With such high expenses, single parents can struggle just to get by. And saving money? All too often, saving is placed on the back burner due to other pressing financial priorities.

It may not be easy, but single parents can put money in the bank with a little help. Here are a few tips on how to save money as a single parent.

Create a plan to pay the bills

If you’re struggling to find enough money to pay the bills, this is your first order of business.

Create a schedule of when each regular monthly bill is due. Compare that to your paychecks. When will you have enough money to pay it?

It’s pretty impossible to schedule bill due dates to line up with your paydays. So it’s up to you to create a plan to ensure you always have enough cash for your bills.

One way to do this is to create a separate bill pay savings account. You can automatically have money withdrawn from your regular savings account and put into your bill pay account. This way, you’re automatically setting aside money to ensure your bills are always paid, and on time. Just be sure to update any automatic drafts you have setup.

Remember, bills have to be the first priority for you and for your kids. If you are continuously lacking money to pay your bills, you may need to cut back on other areas of spending.

Adopt a minimalist lifestyle

Minimalism can greatly improve your financial health. Minimalism, or living with less, means you have to seriously consider every purchase before you make it. Is it something you need? Will it be useful? Will it be worth the cost?

No, you don’t have to live in a nearly-empty house to call yourself a minimalist. By adopting a minimalist lifestyle, you can reduce your expenses greatly. You can cut out anything in your life that no longer serves you or isn’t bringing you joy. Find joy in living simply.

Prioritize an emergency fund

Everyone needs an emergency fund – and that includes single parents.

Emergency funds are absolutely necessary to protect your financial well-being. Tragic things happen – your car can break down, you can forget to pay a bill, or you could get laid off. Don’t let these events ruin your finances. Prepare by starting an emergency fund today.

Sell what you can

If you’re unsure of how to find money to pay your bills or start an emergency fund, don’t fret. One easy way to increase your cash flow fast is to sell household items you no longer need.

This step will jumpstart your finances. Most people easily have at least a couple of hundred dollars worth of sellable items sitting around. Host a garage sale, or sell items on sites like Facebook, Craigslist, or OfferUp.

Use the money you earn to jumpstart your savings goals. And, as an additional plus, by clearing out your home, you’re already starting to practice minimalism.

Plan special, but low-cost celebrations

Between holidays and birthday parties, seasons of celebration can quickly become very costly. And if you have multiple children, the costs can wreck your budget. You could save money for a year and still struggle to pay the bills come the holidays.

I grew up in a large family. My parents lived fairly frugally so we could afford the things that mattered most. During my birthday parties growing up, I remember my parents always went all out making a homemade cake, letting us decorate sugar cookies, and they would give me one small gift. It didn’t cost them much, but they were very fun and memorable. Honestly, I don’t really remember many of the gifts they gave me, but I do remember the traditions they set in place.

Of course, every parent wants to provide their kids with the world. But if you’re struggling to save any money otherwise, you might not be able to afford spending thousands of dollars on Christmas gifts. And that’s okay.

Instead of worrying about throwing the perfect party or finding the right gifts, work on creating memorable traditions for your kids. Because truly – that’s what matters most.

Make the most of advantaged savings accounts

As a single parent, saving money might be exceedingly challenging. But make the most of what you can save by taking advantage of accounts designed for your benefit.

If your company offers any retirement account incentives, take note. For instance, say your company will match up to 5 percent of what you contribute to a 401(k). If you contribute nothing, you are leaving a huge benefit on the table. Do everything you can to receive the full match so you aren’t forgoing benefits your employer wants you to use.

And if saving money for your kids’ college fund is a priority for you, you will want to look into a 529 college savings plan. With a 529 plan, your investment earnings can grow tax-free. You are also able to take tax-free withdrawals when you use the funds on qualified education expenses.

It’s not always easy to come up with the extra cash to add to your savings. But it’s important to remember to save for the future, too – not just the present.

Increase your income

It’s safe to assume that most single parents are insanely busy people. But if you are able, a side hustle can dramatically improve your finances.

Whether you chose to babysit on the weekends or can start blogging and freelance writing, a side hustle is a great way to increase your income quickly.

And don’t forget to consider your full-time job. Is there a way you can increase your income there? Is there an opportunity for you to work towards a promotion? Or, could you potentially switch jobs to receive a higher income?

There’s only so many expenses you can cut back – that’s when it is key to look at your income.

 

Source: YoungAdultMoney.com

 

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10 Money-Saving Road Trip and Travel Hacks

August 13, 2018

Young multi-ethnic friends roasting marshmallows on sticks at the beachWant more quality time with your friends or family this summer? Plan a road trip together! Use our 10 money-saving road trip hacks to get the most out of your vacation budget.

  1. BYOF (Bring Your Own Food)

One of the best parts of road-tripping–at least, in my opinion–is the snacking. There are few things I enjoy more than a guilt-free treat whilst cruising down a wide open road, grabbing bags of chips or chocolate bars at convenience stores that I wouldn’t otherwise allow myself back home.

Of course, these little splurges add up quickly. Add in meals at fast food restaurants, local dives, or chain restaurants, and you can easily bust your budget on food alone.

The easiest way to avoid this is to bring your own food along with you. Pack up a cooler with quick snacks, water bottles and juice, and easy meals. Bring a loaf of bread, peanut butter and jelly, or keep some deli meats and cheese on ice.

Along the way, stock up at grocery stores instead of gas stations. You’ll getting bigger quantities for less, and maybe be able to resist the temptation to grab one of everything.

  1. Eat Big Lunches and Small Dinners

Aside from a stocked cooler, though, there are other ideas for saving money on food. One way you can save is by choosing to only eat at restaurants for breakfast or lunch, when food is cheaper. You can eat more and save your leftovers for dinner time, making your budget meal last even longer.

Dinner meals can often be twice as much, so save those splurges for special occasions (like finally arriving at your big destination.)

  1. Pick Hotels with Free Breakfast

One more tip for saving money on meals? Don’t pay for them at all.

If you stay at hotels along the way, try to pick one that offers free breakfast before check-out. Sometimes, these meals are as simple as bagels and cereal. You might hit the jackpot and find a Belgian waffle bar with eggs, though, complete with complimentary coffee.

We have even stayed at a hotel called Family Garden Inn (in Texas) that gave us a free happy hour! Free hot dogs, nachos, and even beer were available every evening, and free breakfast was lined up every morning. Drury Inns offer this, too! We only had to pay for lunch during our stay, which was much appreciated after the long drive.

  1. Camp or Couchsurf

Hotels are great, especially if you’re traveling with little ones. However, you can save even more money by opting for more budget-friendly accommodations.

One option is to couch surf. Wondering what that is? Well, you’ll sleep on the couches of kind strangers who offer up their homes to weary travelers. Websites like CouchSurfing.com will connect you with these gracious hosts, allowing you to save money and experience your locale in genuine way.

If you have kids or just don’t like the idea of sleeping in strangers’ houses, think about camping. There are plenty of campsites across the country, many of which offer you a free place to set up for the night. Whether you pitch a tent or buy an air mattress designed for your vehicle, you get a good night’s sleep while also cutting costs.

  1. Optimize Fill-Ups

If you’re on a road trip, your biggest expense will likely be filling up at the gas pump. This means that it’s also one of the best places for you to potentially trim costs.

You’re probably already planning your route, so take a guess at the areas where you’ll likely need to fill up. Pick larger cities over small towns, and gas stations nearest to the highway over those off the beaten path. You can also utilize an app like GasBuddy for finding the best prices, both ahead of time and along your drive.

  1. Use a Rewards Card for Gas

While we are on the topic of gas, another way to make the most of your road trip expenses is to utilize a rewards credit card. More specifically, pick one that offers high rewards for gas purchases.

The Blue Cash Preferred® Card from American Express, for example, offers 3% back on all gas station purchases (even snacks!). There are also station-branded cards that offer as much as 5% back every time you fill up.

  1. Tune Up the Car

Want to avoid unexpected repair expenses and optimize your gas mileage? Then be sure to take the car in for a tune up before you ever hit the road.

Get your oil changed and your battery checked. Properly inflating your tires will help with your fuel efficiency. That way, you’ll be less likely to encounter situations when you’re thousands of miles from home, and won’t be at the mercy of small town mechanic shops.

  1. Change Your Key Fob Battery

One thing that many drivers forget to check before heading out on a cross-country adventure? Their key fob.

If you have a newer-model car that has a keyless start and/or entry, you may have already thought about what would happen if the battery died. With many of these vehicles, there is no way to open the door or start the vehicle with a backup key, so you’d just be stranded. And this is a valid concern: according to AAA, over 5 million drivers were rescued in 2016 for this exact reason.

If you want to avoid being stuck in the middle of nowhere, switch out your key fob battery before you go.

  1. Earn Money with Roadie

Have an empty seat, trunk, or bed of your truck? Then you can actually earn cash on your travels by helping to deliver packages for others with Roadie.

We recently wrote an article about Roadie and how this app can help you cover your gas expenses, if not earn you even more. By simply finding packages that need to be delivered along your route, you can utilize any empty space you have to turn it into cash.

  1. Avoid the Lead Foot

The last piece of advice for trimming expenses on your summer road trip? Avoid unnecessary bills in the form of traffic citations.

Small towns love travelers. After all, they don’t know the traps, aren’t familiar with the speed limits, and are likely to pay their fines versus come back to fight them in court. While your out-of-state plates aren’t going to be the reason you get pulled over, they’ll definitely make you an easier target.

Watch your lead foot while on your road trip. You’ll not only save money on fuel, but you’ll avoid a hefty speeding fine in that tiny little town.

Going on a road trip is a fun way to spend your summer. It’s cheaper than flying and offers you a fun experience to share with others. By making a few budget-friendly decisions, you can make it as affordable as possible, too!

 

Source: DoughRoller

5 Financial Tips for New Parents

July 2, 2018

Parents Bringing Newborn Baby Home In CarMy wife and I welcomed our third child in April — and our third boy! And while we have a lot of experience caring for newborns, another child means we needed to adjust our finances, yet again.

But this time around we anticipated some major expenses and planned ahead. For example, we knew months ago we’d need a new vehicle with three rows to accommodate everyone. So we bought a new minivan in December, believing that we’d get a much better price buying in December than in most other months.

New parents spend the vast amount of their initial months caring for their new infant’s physical needs — as they should. But at some point, they also need to make some financial changes that will serve their new expanded family well.

While new parents are trying to find a few hours in the day to catch some sleep, here are five recommendations for them that will provide some financial peace of mind:

  1. Update Your Medical and Life Insurance.

Parents have 31 days to add their new child to their medical insurance coverage. Hospitals provide a document called a “Confirmation of Birth” that must be provided to your insurance company along with other information. This document is vitally important as your child will have at least seven checkups for vaccines and to monitor growth in the first 12 months.

Whether you’ve had your first, second or third child, speak with a life insurance agent to get a new policy or update an existing policy. And make certain both spouses are covered for any situation. For example, if one spouse stays at home and passes away unexpectedly, the remaining spouse could need to pay for child care for many years. A homemaker provides enormous support for the family and is often overlooked since he or she helps the family avoid sizable bills.

However, there is some good news on the insurance front. If you have been waiting to schedule medical procedures, consider scheduling any procedures during the same deductible year. Due to costs associated with the new baby, you will likely hit your annual deductible. For example, I waited to have a minor surgical procedure until the year of our child’s birth so it didn’t cost thousands extra.

  1. Revise Your Monthly Budget – Significantly.

Everyone knows they will spend more, but most people don’t realize the increase will be significant. The expense for diapers is one of the best examples. With our first child, we used the first box of diapers in 10 days. I needed to make a trip to the store for a new box, which means I couldn’t get the best possible price.

I recommend increasing your monthly budget by 10% for the first year to cover these expenses. The increase will likely need to be more with the first child, especially if family and friends can’t pitch in to help buy some costly items. For example, outfitting a nursery from a name-brand store can easily cost in the thousands. With a first child, parents make large, one-time purchases such as swings, cribs, changing stations, car seats and baby toys.

Don’t overlook day care or nanny expenses if both spouses will work full-time. The national average cost of an infant in day care is almost $11,000 per year. That’s like having a second mortgage payment!

  1. Organize and Track Your Records.

Make certain to get paper copies of key records — the birth certificate, Social Security card and immunization record. Order three copies of the newborn’s birth certificate — one for you, one for your child later in life, and one for your guardian. Your child’s Social Security card will arrive by mail. Also, start keeping a record of immunizations, especially if you need to place your child in day care. Place them in a packet with all other documents and keep them in a fireproof safe.

Finally, record and track all medical bills, both pre- and post-delivery to ensure you don’t overpay, or pay twice, for the same procedure. Parents are often required to prepay for certain providers, such as the obstetrics/gynecologist physician, so don’t forget to ensure you are reimbursed if you met your deductible prior to the delivery.

Call your insurance company if you have any concerns or questions prior to cutting a check.

  1. Review Your Estate Plan.

With every birth, especially the first, review and update your estate plan documents, including your will and any trusts. For instance, make certain to nominate a guardian for minor children in your will. A guardian is someone who has legal custody over the minor and control over any assets left to them, such as insurance proceeds, in the case of the death of you and your spouse. Absent direction, the courts will appoint one, which takes this decision out of your control.

If a new child is born and it’s been several years since a will was written, you may need to update beneficiary designation forms for your 401(k), IRA and life insurance. It is important to note that the beneficiary form on file for these accounts — and not anything you might designate in a will — controls where the funds go.

  1. Open a College Savings 529 Account.

These education savings plans are meant to help families set aside funds for future college costs. Funds contributed to the 529 plan account can be invested and grow tax-free, and aren’t taxed when withdrawn to pay for qualified educational expenses, such as tuition. In addition, over 30 states currently offer a full or partial tax deduction or credit for 529 plan contributions.

In 2018, the annual gift tax exclusion amount is $15,000. Beginning in 2018, each parent and grandparent will be able to contribute up to $15,000 annually per child and exclude these contributions from gift taxes. For example, both sets of married grandparents can make gifts of $30,000 each — $60,000 in all — to their grandchild’s 529 plan with no estate or gift tax consequences.

 

Source: Kiplinger