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7 Steps for Saving the Most Money

January 25, 2012

saving money

Everyone wants to save money, especially in today’s difficult economy. While it may seem quite difficult to find effective ways to cut the corners, there are many things that people can do to stay within their monthly budget. Following are some tips that will help people live comfortably, even during financially unstable times.

1. Create a Monthly Budget
For those people who have not already done so, create a manageable monthly budget. People who do not budget often have no control over their finances, and they  end up spending unwisely, putting themselves in serious debt. People should never spend more money than what they have available, and a budget will help them determine exactly how much they can spend after they pay their essential bills.

2. Where to Start
First, list all your essential bills, such as mortgages/rent, utilities, car payments, medical bills, gas, credit card payments, insurance premiums and groceries. Once they have a list of all of their main bills, add them up and compare the total to their total monthly income.
If their bills are more than their income, look for ways to save. On the other hand, if your bills are substantially less than your income, look for ways to invest the extra cash. Rather than spend the extra cash frivolously, it is best to put it towards their essential bills or save some of it for the future.

3. Fix the Problem
While it may seem difficult to cut down on essential bills such as mortgages/rent, car payments, utilities, medical bills, credit card payments, insurance premiums, fuel and groceries, it is highly possible. First of all, while nobody may want to move out of their homes; if their mortgage or rent is too high for them to afford, one may need to consider doing just that. Moving into a modest, affordable home can help anyone stay within their budget.

4. Cars
The same can be said about vehicles. People may need to consider trading their new vehicle in for a modest and affordable used car that they can better afford. This will lower auto insurance premiums, as well. It costs much more to insure a new vehicle than it does to insure a used vehicle. When it comes to insurance, people need to look over their policies and eliminate any coverage that they do not need or will never use. This can save them a substantial amount of money, as well. There are also many ways that people can save on fuel. Making use of such things as public transportation, carpooling and cycling, when feasible, can save consumers a lot of cash (a monthly bus pass costs a lot less than a car payment, insurance, gas and maintenance).

5. Medical Bills
It may seem that there are simply no ways to save on medical bills, especially if people do not have medical insurance. However, using prescription cards and purchasing generic prescriptions will help anyone keep a lot of cash in their pockets. There are also several free clinics and universities that offer various free medical services to patients, as well as clinics that offer reduced fees to those with low incomes.

6. Credit Cards & Shopping
About the only way to save on credit card payments is simply to stop using them. Get rid of all but one, and only use that one for emergencies. When it comes to shopping, it is best to purchase only what is absolutely necessary. Do not purchase any luxury items or things that can wait until the cash is readily available. In short, if it is not necessary, do not buy it. Furthermore, be on the lookout for store credit cards or rewards cards that will save you money. Only shop if you can use that card. Also, only take advantage of these opportunities if you would have spent that money anyway.

7. Extra Cash?
While people may be tempted to waste extra cash at the end of each month, it is best to invest it wisely. This will help anyone stay out of debt and pay their existing debt off quickly.  Some terrific ideas of how to invest this extra cash include paying extra money towards credit cards, paying off an insurance policy, depositing it in a savings account, or paying extra money towards such things as mortgages/rent, car payments or utilities.

In today’s difficult economy, it often seems quite difficult for people to save money. However, there are several ways that they can easily accomplish just that. When consumers follow the easy tips outlined above, they will be able to stay within a manageable budget, and may even be able save some money for their future.

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