We all know the saying, tough times don’t last, but tough people do. Well, I keep hearing (and occasionally saying) that times are tough, and I figured it was time to ‘cinch the belt in a little’. Due to a confluence of events, I find myself looking for ways to save a little more and spend a little less (just like the good old days), so I am writing this article as much for me as I am for you!

First, in offering full disclosure, the confluence of events… My wife and I were blessed with our second son on May 10th, 2007; while definitely a blessing, he also adds to our cost of living. I quit my JOB in December 2007. Just prior to that, times were good, so I bought a big new house and a big new truck. Despite a large down payment, the house still carries a large monthly mortgage. The real estate market is doing worse than the economy overall, and the combined value of my real estate holdings has dropped quite a ways (meaning smaller paydays if/when I sell any of my existing properties in this real estate market). Last, but not least, I recently purchased two fixer upper single family houses, and we are trying to finish up one while we do the early stage repairs on the other… So the ‘cash cushion’ I kept on hand is tied up in the purchase and repairs of those two houses.

Second, with that out of the way, some pain free ways to save more and spend less… If you have not shopped around your automobile insurance in the past 1-2 years, now is a good time. I am not saying settle for a low quality insurer, or for less than adequate insurance, but I am saying keep your insurer honest by making sure you are getting your money’s worth. Many people are surprised by the fact that the same two insurance companies, offering the same insurance coverage, two years apart, may flip flop completely in their rates… I have experienced it personally. Also, if applicable, you may shop around other insurance, such as life, health, disability, etc. You may save money without any sacrifice! Are you on a cell phone plan that makes the most sense for your usage (I know someone personally who should be on an unlimited plan, who continually spends a fortune on overage minutes – WHY?)? 

If your electric bill is high, Lakeland Electric does FREE energy audits. Maybe you know about some things you aren’t willing to do right now, like upgrade to more energy efficient appliances, but maybe there are also some cheap, easy ways to reduce your electric bill significantly that you haven’t thought of. If you have a sprinkler system, is it off during heavy rain periods? Do you heat and cool your home sensibly (for instance, I heat to about 73 degrees in the winter, and cool to about 77 degrees in the summer; a 4-5 degree swing should not result in any real discomfort, and if a bigger spread doesn’t bother your family, even better)? How about giving yourself a financial check-up? Are all of your investments, evaluated individually, doing well, and do they make sense? Do you know what you are invested in, and how and why it should make you profits? Likewise, if you borrow, do your loans make sense? 

Could they be structured better, have better rates, etc.? Especially if you carry a balance on a high interest rate credit card, can you get it reduced somehow? I know I am constantly bombarded with zero interest rate for X amount of months credit cards that might help. As an example, when I have a loan I plan on paying off in full in the next year or two, I get a zero interest for eighteen months credit card, pay off the loan with it, and now my entire payment pays down principal instead of part going to interest. Are you one of those people that pays bills late for whatever reason, thereby incurring late fees, penalties, higher interest rates, etc.? Figure out what it takes to get and stay current, and the savings alone will help keep you there. If you tend to spend more when you use a credit card instead of cash (which most people do), chuck the credit cards. If, on the other hand, you have a high level of self discipline, then use no fee, high rewards credit cards, charge all of your normal expenditures, pay the bill in full every month, and rack up rewards (I do this and my business earns my wife and I nice meals out). 

In fact, since I am rehabbing two houses, I redeemed over $200 in Discover cash back bonus awards this past month. If applicable, improve your credit scores so any future borrowing will get cheaper and cheaper (better rates, lower fees). When it comes to tax time, are you getting all of the deductions you are entitled to? Many people intentionally don’t take income tax deductions they are entitled to because they think it might cause an audit; little side bar here – as long as you aren’t doing anything ‘wrong’, the audit will probably hurt less than the money you are throwing away (in the rare event you do get audited)! Here is one I have found saving me a lot of money recently… When I see something in a store I ‘have to have’, I wait and research it on-line later. Two benefits – first the urge to spend often goes away, thereby cutting out the expenditure altogether, and second, I find almost everything I research I can buy cheaper on-line than what I would have paid in the store (yes, even including shipping and handling). 

If you eat meals out a lot from the JOB, can you save money by packing a lunch more often? Something I find my family guilty of quite often – we throw away perfectly good leftovers while we eat out or prepare something more appetizing. Three solutions quickly come to mind – one, eat the leftovers; two, freeze the leftovers for later; three, prepare smaller meals. If you have the time and inclination (I don’t), plant a garden. Do you make sure to bargain shop, and take advantage of sales on things you know you will use anyhow? And, on the opposite side of the coin, avoid buying junk you don’t need at all just because it was on sale! 

Do you clip coupons, actively look for sale prices, etc.? While I think exercise is great, and I actively exercise myself, if you are one of those people who has an expensive gym membership, and only goes to the gym twice a year, get rid of it. Here is a fun, easy way to save a little dough – my wife takes my kids to the library almost weekly, and they not only get all the books they can read for free, they even get a bunch of kid’s movies on DVD! With the popularity of cell phones these days, I know many people that have done away with their land line because it was wasted money. Last and definitely not least, the old adage, Pay Yourself First! ‘If you pay yourself last, you will never do it. If you pay yourself first, you will never miss it.’ These are all things that, with just a little front end work, can help you save more and spend less without any sacrifice to your lifestyle. Next, on to the things that might hurt a little…

Third, ways to save more and spend less where the terminology ‘no pain, no gain’ applies… These you will feel a little more. Depending on how bad you want to reach your goals, how bad your financial situation is, your time constraints, etc., let’s start with the extreme – can you work more hours, get a second job, start a part-time business (even if temporarily to get over the hump)? Perhaps a stay at home spouse can pick up some work from home? In this economy many stay at home parents watch extra kids for friends or family, allowing one family to make extra money (babysitting) and allowing the other to save extra money (cheaper than daycare). Maybe private school or home schooling needs to be replaced by public school, even if only temporarily while times are tough? It isn’t for everyone, but I know one couple that happily rented out an extra room in their home for a long time. 

Consider a smaller, cheaper, more fuel efficient car, now or the next time you car shop (yes, as mentioned previously, I failed miserably in this category). While on the subject of vehicles, most of you are probably already combining many errands into fewer trips and avoiding unnecessary driving these days. Are you making the most of free entertainment at home? Have a brainstorm session with your family of all of the fun, free or cheap things you can think of to do at home, and then implement the favorites and save the cost of travel and entertainment out. 

Most Americans can save some money by eating out less, and personally I know when I cut back on soda and drink more water my body and my wallet both appreciate it. If you routinely drink coffee at Starbucks, or drink alcohol at bars/restaurants, besides the moral issues, let me kill you now for what you spend per drink! Ouch! And I won’t even get started on cigarettes/tobacco. Last, here is the thing everybody hates to do – create a budget! First and foremost, spend as you normally do, and track every penny for at least a couple of months… and find out where your money is really going. If you can make yourself do it, continue to keep track of expenses for a full year, so you are sure to include once or twice a year expenses like holidays, birthdays, insurance, taxes, etc. Nine times out of ten, there will be some expenses that are shockingly high, and you will know where to look to stop the bleeding.

This article is just to whet your appetite, but if you got some helpful hints out of it, and or you want more of the same, search the internet for some sights on saving money… I know I stumbled across some when I was looking for personal finance information not too long ago, and I saw some good tips, as well as some that I would never recommend… I will share a few since that may be good for a chuckle… Reduce showers to once a week (save on hot water, shampoo, soap, and probably dating, for those of you who are single!). Train your pets to use the toilet. Go around early on garbage day and gather what you need from what others throw away (I guess they do say one man’s trash is another man’s treasure – LOL). Become a vegetarian – it is a cheaper lifestyle (I know meat can be expensive, but that seems extreme to a meat and potatoes guy like me!). Anyhow, enough of the extreme!!! Best wishes everyone, and hopefully I will see you… on the other side of the rainbow (you know, where the pot of gold is)!