This time of year brings about all sorts of resolutions and promises to improve our lives. Often times these resolutions involve finances, so I thought I'd do a post about how to save money. Here are a few of my suggested tips:
1) Pay your mortgage bi-weekly. One easy way to save thousands of dollars is to pay your mortgage bi-weekly instead of once a month. For each payment simply divide your monthly payment by two. This will save you a TON on interest charges throughout the life of your loan. Use this calculator to find out just how much you will save.
2) Stop borrowing money. My motto is "Own not loan". In other words if you can't afford to pay for it in cash, you can't afford it. This includes a car. The only exception to this rule is a house (sidenote: your home should never cost more than two times your annual after tax household income) and certain educational expenses (i.e. those that result in increased pay equal to or greater than the cost of your education). Say goodbye to credit cards, cut them up right now, they are useless, unless of course you are a bank.
3) Cook more. Eating out a lot can seriously suck up your dough.
4) Buy used. Buying used is the ish. It saves me hella money. I buy all sorts of used stuff...cars, purses, furniture, cooking gear, books, household equipment. Ebay, Craigslist (especially the free section), Etsy, garage sales, thrift and consignment stores are all your friends. They will save you BIG time.
5) Stop being lazy (I am sooo guilty of this). People spend tons of money on gym memberships because they think it is necessary to stay fit. This is simply not true. How do you think people stayed skinny 100 years ago? I'll give you a clue it wasn't because of the gym. There all sorts of free ways to stay in shape....do your own yard work (and your neighbors if they can't do their own), walk your dog (or someone else's if you don't have one), play with your kids more, go for a jog, have more nookie, do yoga at home (there are free videos on youtube), run up and down your stairs, use free weights.
6) Reduce your entertainment expenses. The library, parks, Baltimore Museum of Art, Walters Museum, and The Book Thing are all FREE. You can also save money by hosting dinner parties or potlucks instead going out for fancy dinners and drinks.
"Whatever your income, always live below your means. Good health, longevity, happiness, a loving family, self-reliance, fine friends....if you have five you're a rich man." ~Thomas J. Stanley, Millionaire Next Door