14 February 2014

Happy Valentine's Day! 14 Ways to Show Your Finances Some Love

Love your wallet and it will love you!
Legend has it that Cupid shoots arrows at the best deals in the grocery store. Today is Valentine's Day, a time to buy roses (or whatever the flower shop has left over), go out to dinner (better already have reservations!), and pretend you haven't been ignoring your significant other since Christmas. But your wallet is probably still suffering from Christmas! In acknowledgement of that fact, here are some things you can do to show your finances that you love them. At any time, really.

1. Track your finances
Garbage in, garbage out. But how do you even know what's going in and out (but sadly not In-N-Out) unless you keep track of it? Whether you use Mint, Personal Capital, Excel, or just a pen and some scraps of paper, make sure you know where your money is coming from and especially where it goes.

2. Stop driving
With the IRS allowing us to deduct $0.56/mile for business expenses,  that means that most people's driving costs a similar amount. However, driving is one of the least obvious drains on the wallet. Even if you drive a Volt that you got on a mythical $179/month lease, miles add up quickly because many people do not have a good concept of distance. I used to routinely drive 400 miles/week, and that was barely my work commute and a few errands. I hardly felt like I was driving. I've since reduced my driving by quite a lot. I suggest you also cut back somehow . The extra money is nice.

3. Stop paying interest
One sure way to make sure that you're sabotaging your progress is by sending portions of your money to others just because they let you use their money. The sooner you can stop that practice, the better.

4. Increase your income
Whether that means dusting off the résumé for a round of hiring manager roulette or just creating a debt snowball, more money never hurt anybody. Yes, I typed that with straight fingers.

5. Cut the leaks
Or in other words, make sure you're not trying to heat the state of North Dakota in the dead of winter nor cooling the Mojave during a Cali summer. You probably cannot have too much insulation. For starters, make sure your windows and doors are effective barriers against the elements. Expand into the walls if you can. Even with the HVAC system is up to snuff, keeping it from having to run by taking care of leaks will save lots of money.

6. Get out your bike
This is how you get around once you stop driving as much. You do have a bike, right? Take it out and ride it. Like yesterday. Don't worry if you don't have any Lycra, that stuff is overrated anyway and not necessary. But you can never have too much light. I roll with two lights on my bike to make sure that I see the potholes.

7. Cull your junk
One quick and possibly easy way to get the income figure increased (at least temporarily) is to sell any unneeded and unwanted items you have sitting around. If you can. There's no one good way to sell your stuff. Ebay works for some, Amazon for others, and yard sale for a third category. Unless you need the stuff gone tomorrow, you should have time to research and find out which method gets you the biggest payday. Do it.

8. Trace the money
How much is eating out costing each month anyway? With the monitoring you set up in #1, it will be much easier to figure out where exactly your money goes. Follow up to make sure that it goes where you think it goes and that where you think it goes is where you want it to go.

9. Learn something
Knowledge is power, you're never too old to learn. While learning never ends, the learning of school is rather limited. You don't have to go sign up for classes to learn, even if you want to explore the nuances of Schrödinger's cat and his equations for fun. (You can just buy previous versions of textbooks on just about any subject from Amazon or eBay for pennies and teach yourself.) But learning new skills can be a good way to help #4. Everything from getting a degree to learning how to properly track your mileage can be used to your advantage in earning a few more pennies.

10. Stay healthy
Historically a relatively minor portion of most people's expenditures, healthcare expenditures are set to explode for many. Sure, Obummercare is supposed to result in everyone getting insurance and "allowed" those who liked their plans to keep them. While healthcare inflation is no longer galloping along at multiples of the economy, many of us are still going to see higher costs in one way or another. Regular exercise can stave off diseases such as diabetes, improve libido and work performance, yada yada yada. With employers offering more carrots & sticks to promote health, those who are healthier will stand to benefit many times over. The recommendation of 150 minutes weekly can be easily divided into daily segments that are manageable to accomplish, so not having time is hardly an excuse.

11. Get rewarded
Companies like to pay you to do all kinds of stuff, hoping that you'll return the favor by buying stuff from them. So from the more obvious like frequent flier miles and grocery rewards to the obscure, the chance to profit from your spending exists all over the place. One way to ensure that you get rewarded even when a specific rewards program doesn't exist is to carry a rewards card to use for as many purchases as you can. Of course, pay it off monthly! We've already discussed interest and I've yet to find one that pays higher rewards than the interest rate it charges.

12. Negotiate your purchases
Prices usually aren't set in stone, not even in the big box stores. (Just last week, I successfully defended a UPC scan for a folder that didn't agree with the shelf for a $3 savings.) However, if you just roll over and accept them, then they are for you. I know, I've done it. Always find out if the price you're supposed to be paying is the best that the seller can do, and if it's not, send them back to the drawing board. Still not happy? Leave. You hold ultimate control over your own purse strings.

13. Embrace change
This one might seem to be at odds with the premise of this entire post. Change is generally associated with new, which is often combined with spending. But change doesn't have to require breaking out the wallet. There are plenty of changes that can be beneficial to your wallet. Some of them have already been mentioned, e.g. changing driving or health habits. All can have a positive effect on your financial situation, so embrace the change and the spare change that it brings! And unless you're Bill Gates, it's probably worth your time to pick up spare change too.

14. Pay off debt
Last, but certainly not least, we come to the topic that might seem to be the most obvious to be on this list. As such, I'd better not disappoint. This isn't just a tip from me, it's something that I'm also actively working on in my own life. I also carry financial obligations to several entities. They aren't currently anywhere near a absolutely crucial level, though MMM might disagree. However, if I were to become unable to work, they would indeed cause issues in quick order. Therefore, I am committed to erasing them as fast as possible using as many of the tools in this post (and others) to do so. If you're also carrying any debt, it's probably a good time to look at the terms (again) and get them altered.

Photo credit: Danilin on freedigitalphotos.net.

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