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| 2011 Checkup: Getting your financial house in order |
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For many of us, New Year’s resolutions fall into one of two categories: diets we don’t keep, and financial promises we don’t keep. The New Year can be the perfect excuse to revisit those finances, but sometimes the size of such a project can seem to require too many phone calls and too much unpleasant number-crunching. But shoring up your money situation doesn’t have to be a major project; there are plenty of things you can do now, from the comfort of your own couch even, to start getting your house in order.
TAKE IT IN STEPS
Start with something easy, like looking at how you file your federal income tax. Find as many exemptions and allowances as you can, since it’s better to have less withheld from your paycheck than let the government take it interest-free. If you’re single and making $30,000 a year, for instance, claim two extra allowances. Have less taken out of your paycheck, and you’ll have more income each month. Simple stuff.
Look around at work, too. If you’re one of the fortunate ones with a 401(k) at your workplace, boost it. Many companies still match your savings sacrifice; if you haven’t asked about this service at your office, do it now. On the home front, most resolutions are all about spending, spending and spending. It’s easy to make promises, sure. But it's also easy to leave your credit card and/or checkbook at home when you hit up the big-box stores. Hide your card in another room when you go shopping online, too — just because something’s got free shipping doesn’t mean you need it.
The principle translates to the grocery store, too. Many of us go three or four times a week, often in the pursuit of random, impulse groceries we don’t need (or sometimes even want). As mechanical as it sounds, a weekly menu plan and couponclipping campaign will result in fewer trips to the store, and more savings than you suspect.
Once you’ve mastered those simple tasks, flip through the following pages for more tips for 2011. Once you’ve knocked them all off the list, you can get right back to working on that diet.
TEACH YOUR CHILDREN WELL
Here’s one that’ll pay off for everyone in the house: Give your kids a piggy bank and use it to teach money management and the virtues of saving. The kids will learn coin counting at school, of course, but you can teach them at home what they can buy with their own savings. If you're feeling particularly practical, have them pay a "bill" now and again.
DO WHAT YOU JUST TOLD YOUR KIDS TO DO
You know that piggy bank idea? Get one yourself. (It can be a jar or whatever, though we really like the idea of an island full of adult piggybanks). Drop some dollars or coins in there every day, and at the end of the month you can congratulate yourself for accumulating all that free cash. (Seriously, imagine a mystery $40 showing up in your wallet). On a more offcial level, check with your bank: Many offer small savings plans that automatically set aside as little as a couple of dollars a week; sign up and rest comfortably knowing that instead of vanishing from your wallet on its own, your money is being safely tucked away.
PASS (ON) THE POPCORN
Cut back on those little luxuries, such as snacks at the movie theater, where treats like popcorn and Junior Mints can be marked up as much as 1,000 percent. Boxes of microwave popcorn are about $3 at the grocery store; at the theater, they can be $6 for a single bag. You can make it through "Harry Potter" without candy.
DRINK WISELY
Nix purchasing drinks by the glass at restaurants – you’d never pay those prices by the bottle. And, seriously, sit down and address your coffee needs. Coffee, as we java connoisseurs know, is notoriously pricey, so make your morning joe at home, get a nice spill-proof travel mug and take it on the run.
ROAD TRIP LIKE A CHAMPION
Taking a driving vacation or a weekend trip? Let’s see if we can’t simplify this one: BRING YOUR OWN FOOD. You’ll save a ton, and avoid the dulling similarity of the average highway lunch. Pack lunches, light dinners, snacks, munchies and bottled water, dine al fresco at rest stops or parks, and put the $50 you just saved into your gas tank. (If you’re the sort who prefers to fly the friendly skies, use a credit card that offers travel miles.)
GARDEN AT HOME
One of the more pleasurable – and, if I may be so bold, spiritual – endeavors you can embark on at home is cultivating a garden. You don’t have to be a master organic gardener to put food on your own table; a small patch of land or window box will get you started. (If you’re looking for advice, watch South Carolina’s own “Making It Grow” on WJWJ.)
PAY CASH
Cut up your credit card. Stow away your credit card. Bury it in the backyard. Pay cash, and watch how much it changes the notion of spending. And this goes without saying: As painful – and occasionally impossible — as it sounds, pay off your credit cards as strenuously as you can. Take a good hard look at those store cards, too; some of them charge exorbitant interest.
TAKE A FAMILY INVENTORY
If you’re finding that everyone’s priorities are all over the place, establish a family mission statement (more about this on page 38). Bang out a monthly budget — or a weekly and even a daily budget, if it comes to that — and give yourself incentives to stick to it. If everyone under your roof is working under the same rules, things will be a lot more effective and efficient.
CUT THE CABLE
Get rid of your cable. Yeah, we said it. Look at your next cable or satellite bill, go online to investigate the many ways you can get your entertainment/news from the Internet and determine how much you could save each month. Netflix, for instance, recently began offering a streaming-only service designed to replace its familiar red envelopes. The awesome and free online video service Hulu offers TV shows and movies for computers, TVs, mobile phones and tablets, and Steve Jobs’ Apple TV — which connects your TV to your computer through Wi-Fi — was just knocked down an extremely reasonable $99.
GO THROUGH YOUR HOME WITH A FINE-TOOTHED COMB
Have a professional — or your power provider, which would be cheaper – inspect your home to find ways to save on energy costs.
An average homeowner will spend $1,900 a year on heating and cooling, but with a few adjustments — some minor, some major — total annual savings of 30-50 percent are not unheard of.
Again, don't feel like you have to think big: Just unplugging the second refrigerator in the garage or basement will cut $150 from your annual energy bill. Even minor investments in weather stripping and upgraded insulation can pay dividends.
Don’t forget that those groovy corkscrew LED light bulbs will save you money, too.
FIND A TRAINED PROFESSIONAL
Contact one of the many fine financial advisers in the area about putting money in diversified investments. They’ll minimize risks — and, as many of our neighbors have found out the hard way in recent years, investing in just one or two stocks can result in financial catastrophe.
MAGIC JACK, JACK
Yes, we’ve all seen the infomercials, but this thing is absolutely captivating. Plug the little $39.99 gadget into your USB port and your domestic phone calls will be free for the first year. Keep the product and it’s $19.99 a year. (Of course, you have to have a high-speed Internet connection, but think of it as one final reason to hang up on your land line.)
When ordering Magic Jack by phone be sure to take caution at the end: The system queries you about buying other devices at discount. Just press the right button to end your order.
BECOME A SECONDHAND DETECTIVE
Some may still wrinkle their noses at the thought of shopping at dollar stores and secondhand thrift shops, but there is a ton of money to be saved by doing so.
And what’s more, many secondhand stores in Beaufort County are nonprofits that give their proceeds to charities — donate and get a receipt for tax purposes. But, as with any store, be sure to go in with a plan or you’re bound to get carried away with spending. Many thrift shops have hardly-used clothing and electronics in excellent condition.
You’ll be amazed. Trust us.
RETHINK YOUR ROUTE
Carpool with your neighbors. Sure, the idea hasn’t quite caught on around here, but sharing drives to work, Bluffton or even church will help you save at the pump. Try word of mouth in your neighborhood, or put up a sign at a local community center. If you’re feeling ambitious, start your own carpooling club.
MULCH EVERYTHING IN SIGHT
Save grass cuttings, raked-up leaves and mulch for future gardening projects or composting (which is another way to save a little money on fertilizer.)
E-BATES
Do you shop online, like an increasing number of store-weary citizens? Then ebates.com is a no-brainer. It’s a quick, easy portal into retailers’ sites — and it adds reward points for your shopping.
SHOP AT THE LIBRARY
It may sound a bit odd, but the library can be a great way to save on books and magazines; friends of the libraries are always selling books for cheap, often right up front.
CHANNEL YOUR INNER ENTREPRENEUR
You may not know it, but you could be a potential small business owner. Look at your interests and talents — anything from computer smarts to landscaping to organizing to cooking to pet care — and find something you can do at home to could bring in a little extra money.
And while you’re contemplating launching your own personal small business, gaze around at all the useless stuff you accumulated in 2010 and get rid of it via a nice lucrative yard sale.
REVISIT YOUR LIVING SITUATION
If you rent, you may want to stay a renter; there’s no shame in it, as most bankers and financial advisers with any soul will tell you. Take the money you’d blow on a house in this fragile economy and put it in a savings or solid investment account.
HELP PUT AN END TO RE-GIFTING
It’s too late for the holiday season, but for upcoming celebrations, birthdays, anniversaries and whatnot, spread the word among family, relatives and friends that in the spirit of financial sanity and fiscal responsibility a cease-and-desist on rampant gift-giving is a great idea.
Offer services or experiences instead. Remember that cost of gift does not equal quality of gift.
Frankly, if this keeps up, re-gifting may not survive.
OH, AND ONE MORE THING...
Finally, kick the bad, costly habits – smoking and drinking. You and yours will be richer in many ways.
