Source: Flickr user Zack McCarthy.
For every reason to save, there are millions of reasons to spend. Such is the reality of a consumer economy that loves to find new ways for us to part with our money. But you don't have to go along with the status quo. In fact, you can save yourself $1,000 this weekend.
1. Shop your monthly expenses
Like most people, you probably have a number of recurring monthly expenses -- things like auto insurance, cable and cell phone bills, or even a gym membership. Some of these expenses provide more usefulness than others; you can't drive without car insurance, but cable might be negotiable. Now, I'm not one to tell you that you shouldn't have cable. But what youshould do is make sure you're paying the lowest possible price for each of your recurring expenses.
If you haven't shopped for auto insurance in a while, you're almost certainly paying too much. Compare your rates with direct underwriters like GEICO or Progressive. They cut out the middlemen (agents) and can beat most agent-based insurers on price. By cutting ties with my previous car insurance company, I'll save $400 this year. Switching took all of 15 minutes -- my new insurer was more than happy to do the work to steal me from my old insurer.
Likewise, it's time to negotiate with your cable company. Millions of Americans are cutting the cord, so you have the advantage at the negotiating table. Use it. Between these two expenses alone, you could easily cut hundreds of dollars from your 2015 expenditures.
2. Cut your rates
Got debt? Get better interest rates.
Interest rates are negotiable, period. Credit card companies may reduce your rate if you ask politely, and most will give you a low- or zero-interest balance transfer for moving your balances from a competitor. Use transfers as a secondary option: Even zero-interest balance transfers usually add a 3% fee on top of the balance. Negotiate first. But make it a priority to kill off credit card debt before any other, because it's ridiculous to pay 15% interest when your savings account yields 0.01%.
Almost all forms of debt can be refinanced, including student debt, mortgages, and auto loans, just to name a few. This is particularly important for people who had no credit or low credit at the time the loan was issued. If you've paid on time since, you can almost certainly get a lower rate today. The difference between 3% and 6% interest on a $10,000 debt is more than $800 over five years. It's worth your time.
3. Track your spending
Personal finance is almost entirely behavioral. Success is all about curtailing the missteps that hurt our finances over the long haul.
The best way to start slashing your spending is to keep track of where your money is actually going. The Internet makes this easier than ever. Online tools and smartphone apps like Mint and Level Money automatically track your every expense and categorize each purchase so you don't have to.
You might be surprised to find that lunch dates with colleagues are costing you hundreds per month or that your unread magazine subscriptions are nibbling away at your bank balance. Nip it in the bud by being cognizant of where your every dollar is going by tracking every dime that leaves your possession.
