 |
|
|
|
Contents
|
|
|
|
|
|
|
|
|
|
Saving money as interest rates increase
Some financial discipline will help you stash some money away
As interest rates and gasoline prices go up, it becomes harder than ever for consumers to save money. Here are some tips that may help you put an extra dollar or two away.
Continued below
|
|
|
|
|
|
Some smart tips to help you save money as rates rise
Americans are not very smart savers. As a rule, we would always rather spend money than save it. Lenders and creditors know this, and they have made it easier than ever for us to spend when we should be saving. The average household now has nearly ten thousand dollars in credit card debt alone, and mortgages and car payments make the debt load even worse. With interest rates rising and gasoline prices higher than ever, it is quite difficult to put a few extra dollars away.
Here are some tips that may help you find a bit of extra savings here and there:
- Pay down the credit cards - Sure, it’s hard to do, especially since minimum payments were increased last year. But credit card loans are expensive, with the average card having rates of nearly 20% per year. The money you spend on interest is money for which you receive nothing. The best way to save money is to spend more - pay down your credit card debt now.
- Pay off other installment loans early, too. Got a car note? Add a few extra dollars to the payment each month. Interest accrues over time on the unpaid balance, so the less you owe, the less interest will pile up.
|
|
|
|
- Transfer money to another account- You may qualify for one of those balance transfer deals that credit card companies frequently offer. If you transfer a balance from one card to a new one, you can often do so with interest rates as low as zero percent. Watch out, though -the fine print can kill you if you make additional purchases on the new card, pay late, or take too long to pay down the balance. Still, with some discipline, the terms can be favorable.
- Limit your investing - Financial markets are a bit soft, and the money you earn from investing is likely to be less than the money you are paying out on your debts, especially if you have credit card debt. Go back to square one and pay off the plastic first.
- Make a budget and cut out items you don’t need - Sure, that $4 latte is nice, but do you need one every day? Can you carpool to work to save gas? Can you take your lunch to work instead of buying it? Every little bit helps and if you apply the savings to paying down your debt, it adds up even faster.
- Make a budget - See how much money you have coming in each month and how much goes out. Look at the essentials first, and then see how much you are spending for nonessential items. You may be able to cut out more than you think.
It isn’t easy saving money, especially when the cost of everything is going up. But it can be done. It just takes some discipline and practice. The time spent is worth it. The last thing you want is to get caught in an emergency without any savings. That would be bad news, indeed.
|
|
