Making Smarter Purchases in 2019
While money is a part of our everyday lives, using it efficiently and understanding how to manage can be very confusing. Not to mention, frustrating. Gaining control of your money can really propel your overall happiness. Use the new year to take control of your spending and jumpstart your savings.
To start, consider asking yourself what areas of your financials can be improved. Is your rent too high for your income level? As rent prices climb and interest rates plateau it could make sense to change that rental agreement for a mortgage agreement instead. While renting may seem like a cheaper option in the short-run. In the long-run, you’ll essentially made no financial progress. With a mortgage, you’ve made an investment. Often, you'll find mortgage rates are similar to rents anyway, and meanwhile you have the power to return on that investment, through everything from refinancing, selling, to renting out rooms on AirBnB.
Believe it or not, one of the largest expense Americans face is unnecessary money spent on food. If you don't control your food purchasing habits, you could wind up paying too much on restaurants or impulse groceries items. Americans waste a huge amount of money on expired food they never end up eating. This can be avoided by making a weekly meal plan and only buying what is on your list. While eating out is a great way to catch up with family and friends, don’t make it a habit. Rather save dining out for special occasions or allot yourself one to two meals a week. When you do go out, save your leftovers for lunch the following day and always ask what’s on special before diving into the entire menu.
Credit card debt
Aside from food, another large money obstacle is credit card debt. A huge amount of Americans currently owe money on credit cards. In addition to owed money, credit card debt can also stir up additional expenses such as causing your mortgage and auto loan rates to increase. So, if you have credit card debt it’s critical to make a plan of attack sooner rather than later. Even small monthly payments can reduce your burden dramatically in the long run. Consider consolidating your debt in order to get control of your finances--even building your credit will help enormously to save money on a variety of things.
When considering your transportation options, make sure that you’ve done your due diligence to find the cheapest option. Depending on where you live, for instance, commuting by car can actually be cheaper or comparable to the money you'd spend on public transportation. Check out a number of parking garages, see if you can strike a deal. Consider driving a hybrid or electric vehicle. Or even bike if your city allows for easy transportation. There are many different options available with a bit of research.
If you're considering buying a car, there are a number of factors to keep in mind to make sure you're making a smart purchase. The first is budget: how much can you afford to pay? A common rule is only buy what you can afford to pay back over the next three years. Make sure to be realistic, not idealistic--the worst thing you can do is make a budget you really can't afford. Once you've done that, shop for a loan before you shop for your car. Check out your local credit union and ask if lower rates are offered for setting up automatic payments. These are all factors that can make a huge difference.
No matter what, just a few small adjustments can make the difference between struggling for survival and saving for success. Life gets complicated, and having balanced finances isn't so much about making a huge amount as it is about organizing what you've got. So, with only a few changes you can be saving that money on what counts.