Posted by Jay Soriano
on Aug 22nd, 2012 in Miscellaneous
| 0 comments
If you’re feeling the pinch of the recession then rest assured, you’re not the only one! Now more than ever is a time to be smart with your money and cut costs ruthlessly wherever possible to make sure you aren’t too affected by these tough times.
For most people, frugal lifestyles and over-the-top cost cutting is unsustainable and will make you miserable. Sure, you could bake your own bread and make your own detergent while living on a diet of cheap rice and beans, but chances are it would depress you.
And when you’re depressed, you look to feel good again by any means necessary. That means spending sprees and getting into even more trouble.
Instead, why not beat the recession by focusing on proven cost cutters that will have the biggest impact, save you a huge chunk of change and allow to live pretty much the same way as you do now.
5 Proven Cost Cutters
- Remortgaging.It has been said that cutting 1% from a mortgage of $100,000 could save you $1,000 or more every year. It’s one of the most high impact savings you can make, yet many people don’t. The fees put a lot of people off, but sometimes you can be up $500-800 including paid fees so it’s definitely a worthwhile consideration. If you signed a fixed mortgage term on a higher interest deal, you could drop it by 2% or more when it ends, saving $1000s. I know, because I’ve just done this myself!Total saving: $700-1000
- Gym memberships.Gym memberships can be hugely expensive and it is estimated that 50% or more of people who have membership don’t even go! The average cost is anything from $20-50 a month. Imagine if you got yourself the latest P90x home workout instead. Chances are it would get you in better shape, in less time, and you’d save around $500 a year. Competition between local gyms is huge right now, so if you do go you might be able to slash your fees by switching to a cheaper gym in your town. I pay 50% less for my gym because it is smaller and only has free weights. It avoids the social cyling/treadmill/cross-trainer crowd and I get to work out in peace!Total saving: $240-£600
- Credit cards.Credit card debt is the most dangerous of all debt and if you only make minimum payment, you could be paying it off for 20-30 years! Luckily, many providers encourage new business by offering 0% introductory offers. Switching a balance of $4221 from a 14% APR to a 0% interest deal with a 2% transfer free would save you almost $400 in yearly interest! You also get the added bonus of paying off your balance quicker and freeing up that cash to save or invest elsewhere.Total saving: $0-$800+
- Cable.On average, cable TV costs $40 a month. For people feeling the pinch of the recession, this can be a huge difference. How about cancelling your subscription and going for Netflix at $10 a month instead? You can watch all the movies and TV shows you like and you can watch it using a TV, PS3, Wii, Xbox, Apple TV and more. Best of all, watching less TV allows you to focus on other areas of your life. Maybe you could start a side business with the time you used to spend watching TV, or maybe you just do something enjoyable to keep you happy during the recession? Either way, you’ll be better off with less TV.Total saving: $360
- Home energy (£300+ saving). We are creatures of habit, which is the only reason I can think of why people stick with expensive home energy suppliers without looking for a better deal. You could save up to 30% on energy and other bills by using a comparison site like WhiteFence. I actually checked their system for an address I used to live at in PA and it could save them 1c per kW of energy – that’s about $100 in electricity. Imagine how much more you could save with gas, water rates etc.Total saving: $100+
By slashing your costs in these key areas it’s easy to see that you could save a huge amount of money without affecting your lifestyle. It should be enough to avoid recessionitis and it might even inspire you to bigger and better things to keep you financially free no matter what’s going on with the economy!
Ian is a writer and small business owner who helps people to simplify their finances at his blog DebtConsUK. He can also be found on Google+.
Leave a Reply
You must be logged in to post a comment.