Tuesday, June 30, 2009

How to Save When You Can't Save a Dime

Building a nest egg, funding college, saving for retirement, or even establishing a financial cushion for those inevitable curveballs that life throws us from time to time, can be difficult for some folks. But even if you can't possibly save a dime, you can. Here's how:
  • Start by saving the loose change from your pocket/wallet every night – chances are you won’t miss this money too much (it's just pocket change after all). Allow it to add up until you can deposit it in your bank account.
  • Add to it the money you save by using coupons, buying in bulk, shopping at sales, etc. Not only does this prove how much you have saved in real dollars and cents should, but it keeps these savings from sliding back into the “time to spend” fund.
  • Remember to include all the money you save from having coffee at home, bringing your lunch to work, not buying that beautiful pair of shoes, taking a bestseller out of the library instead of buying at the bookstore, etc.
  • Immediately add all “refunds” – tax refunds, flexible spending/medical refunds, product rebates, business travel/entertainment reimbursements -- to your bank account.
  • After a while, you'll see that you can live on a little less than you expected. At this point, you're ready to direct deposit portion of your paycheck into your savings account. Choose an amount that isn't onerous - the point here is really just to keep your bank account growing.
  • When reoccurring payment ends – your car is paid off, your child's braces come off, etc. – don’t let the extra money be reabsorbed by regular expenses – continue to put it aside to save for your next financial goal.
  • If you think you’ll be tempted to dip into your savings, don’t apply for an ATM card (or cut it up) for the savings account, so you’ll have to walk into the bank and wait in line for a withdrawal.

Monday, June 29, 2009

Going Bananas

It happens to all of us: the bananas we bought for our morning cereal turn brown before we have a chance to eat them. But wait! Don’t waste money by throwing them away. Instead:
  1. Cut up the bananas and freeze the slices for smoothies. You'll find that doing so adds flavor and serves as substitute for ice.
  2. Use the overly ripe fruit by making banana bread, banana muffins, banana pancakes, etc.
  3. Make banana pops – cut each ripe banana in half, stick a Popsicle stick into the center, and cover w/yogurt, melted chocolate, crushed nuts or cookies and freeze.

Sunday, June 28, 2009

Three Ways to Save

The way I see it, there are three basic ways to save:

1. Buy it cheaper (example: pay as little as you can when you buy a car).

2. Make it last longer (maintain the car well so you don't have to replace it often).

3. Use it less (walk, ride or take public transportation when you can, so you reduce the wear and tear on your car).

The best way to save to use a combination of 2 or 3 of these.

Saturday, June 27, 2009

Keeping a Budget

Don’t think of keeping track of expenditures as a boring hassle – rather it is way to understand your existing habits – then you’ll be able to decide if you want to change them. Similarly, being on a budget isn't meant to be a restraint, but rather a way to achieve your goals.

Friday, June 26, 2009

Control Impulsive Shopping

For many of us, it is the impulse buy that ruins our carefully planned budget -- the expensive junk food we pile into our shopping cart as we approach the check-out line, the luxury latte we get for a late-afternoon pick-me-up, the gorgeous shoes we find (on sale!) when we're browsing at the mall. How can we get back on track? Here are some tried-and-true tactics for controlling impulsive spending:
  • Freeze your credit cards in a block of ice (you can thaw the ice to use them in emergencies or for planned purchases).
  • Know your weaknesses: if it is snacks or drinks for the kids, plan ahead and carry those with you. Ditto for water bottles, etc.
  • Impose a 3-day waiting period before any unplanned purchase. If you find that you still can't live without it, it is more likely to be a worthy expense.
  • Resolve to discuss any unbudgeted purchase over $100 with your spouse or a close friend. Having to justify these splurges to someone else can help you resist the urge to buy.
  • Keep only enough cash in your wallet for your planned purchases and leave the credit cards at home to control spending at the mall.
  • Change your thinking: if shopping used to be a source of entertainment, amuse yourself instead by seeing how long you can keep $20 in your wallet without having to spend it.
  • Make a list of your financial goals and keep it in your wallet to remind yourself that what you really want is a vacation in Hawaii next year, a college education for your children, or a secure retirement (things that will provide lasting pleasure), rather than a temporary indulgence.

Thursday, June 25, 2009

Negotiate for Everything

Don't always assume that the list price is the final price. Often, if you ask for a better price, you'll get it. This is not to say that you should aggressively haggle - Americans aren't really used to that and merchants may get offended - but if you politely ask if the seller can do better on the price, you may be surprised at the savings you can find. Here are a few tips:
  1. Negotiating works especially well in small stores (rather than large chains) – so always ask! I once got a 25% discount on jeans when I said I really wanted them but couldn't afford the listed price.
  2. Even in chain stores, you should ask for a lower price - sometimes clerks have coupons that they'll key in for you, or if sale prices are about to take effect the next day, they'll hold the item for you.
  3. Negotiating for lower prices works especially if it’s the last one, or a display model, or smudged, with a loose button, etc.
  4. You are also likely to have better luck if you are a regular customer - so be sure to ask for discounts at the retailers you patronize the most.
  5. Don't forget to ask for a better price when you're buying services - a friend of mine negotiated a lower price for braces from her orthodontist; similarly, I received a special discount on speech therapist fees.
  6. Make sure you are speaking with the decision-maker - e.g. the owner or manager of the business who has an incentive to make the sale.
  7. Focus on your need to get a discount - e.g. "I really can't afford more than $25 an hour" - rather than criticizing the product/service provider ("this really isn't worth more than $25") and emphasize your desire to work together to find a solution (e.g. perhaps you can offer a small business owner cash so that they can save the credit card fees).
For more ideas see How to Bargain and Save Money.

Wednesday, June 24, 2009

Abandoned Items

Ask your dry cleaner, shoe repair place, other repair shops if they have abandoned items for sale – you can often get great stuff for just the cost of the repair.

Tuesday, June 23, 2009

Always Ask

No matter where you go -- to museums, movies, restaurants, amusement parks, or anywhere else -- always ask about senior discounts, student discounts, military discounts, AAA discount, AARP discounts – whatever discount you might qualify for. Even if they are not posted, these discounts may still exist. And over time, these savings can really add up.

Monday, June 22, 2009

Meal Planning

The amount of money you can shave off your food bill depends on the extent to which you are willing to completely forgo restaurant/take-out meals, prepared and convenience foods, and pricey cuts of meat. But even if you don't want to go to the beans-and-rice extreme, sitting down and thinking about what you are going to eat each week (and then following through on the menu plan) will help ensure you use up produce and other perishables before they spoil. The idea of shopping daily in a farmer’s market is a nice idea, but can be an inefficient use of time and money. I find it is less expensive to buy less often and prepare meals in quantity (you can freeze the excess to use when time is short). Meal planning should take good use of your pantry – you can buy in bulk when things are on sale and therefore have what you need on hand at the lowest possible price. Of course you'll want to buy more of things that go on sale infrequently and less of what is on sale regularly, in quantities consistent with your rate of usage.

Incidentally, planning and shopping for meals once a week works for me, but others find that a monthly schedule works better for them.  That's fine, of course, the goal is to plan ahead so that you aren't wasting money on last-minute take-out or restaurant meals, and so that you actually consume all the food you buy.

You'll save the most money if you plan your menus based on supermarket sales and coupons.  At the very least, keep your menu flexible enough so that you can make substitutes based on what your supermarket has on sale.  For example, there are a number of cereals (including oatmeal) that my family rotates through for breakfast, depending which ones are discounted.  Similarly, I can almost always substitute cuts of chicken (or parts for whole and vice versa) based on what will save me money.

Sunday, June 21, 2009

Drive Safely and Save

As we head into the summer vacation season, it is good to remember that not only is it safer to drive within the posted speed limit, but you can save money by obeying the law:

a. You'll avoid costly tickets.
b. You'll use less gas.
c. You'll save stress, wear and tear on tires, brakes, transmission, etc.
d. You'll reduce your chance of accidents and thus won't have to face rising insurance costs.

Saturday, June 20, 2009

Save Money on Your Gym Membership

Before you sign that gym membership contract, think about how much you’ll really use the gym. If much of your exercise is running outdoors, going for bike rides, etc., perhaps you’ll save money by just “paying as you go” (many gyms have guest fees) a few days a month. Be sure to try out a gym before signing up to make sure it has all the equipment you want. Also if you find that it is, say, too crowded at the time of day you want to work out, maybe you wouldn’t use it as much as you expected. Pay for the entire year at once – generally this costs less than paying by month, plus you are less likely to let the membership drag on if you find you don’t really use it. Finally, find out if you can you barter some of your time, perhaps by working in the child-care room a few hours a week, in exchange for a “free” membership.

Note that there are many ways to get exercise without joining an expensive gym. Even busy parents with young children can find a way to fit exercise into their schedule by working out at home with dvds or with FitTV (look for programs that include the kids!), by bike riding – with kid in seat behind or in front, or by running with kids in a running stroller.

Friday, June 19, 2009

Babysitting Bargains

Now that the weekend is here, parents might be thinking about how to manage some special time with their sweetie. There is no question that finding a well-qualified and responsibile person to watch the tots can be expensive - for example, in NYC (where only the air is free!), babysitting rates start at about $10 and can go much higher. So here are some ideas that will allow you to have some precious time off from the kids, without totally blowing your budget:
  1. Join a babysitting co-op. These groups typically allow you to watch other kids in return for having someone else watch yours another time. You can find one by asking around at your child's school, playgroup, local churches, or even doing a search online.
  2. Switch off with a friend. A less formal version of a babysitting co-op, taking turns with a friend (preferably one with children whose ages match the ages of your own brood) requires some advance planning, but the payoff is that your kids come to look forward to what is essentially a playdate. You can even do sleepovers and have an entire night that's kid-free.
  3. Take your kids to Ikea – Friends of ours swear by megastores that offer free babysitting services. They report that you don’t even need to shop; you can go to the cafĂ© and snack, talk or just read the paper. You can't leave the store, of course, but this works in a pinch if you just need a break.

Thursday, June 18, 2009

Reward Programs

The concept of rewarding loyal customers began with the airlines and their frequent flyer programs. But while these reward program pioneers have become increasingly restrictive (just try scheduling a flight for a family of four!), the second generation of loyalty programs seem to be getting better every day. Many retailers (from supermarkets, to clothiers, to sporting good chains) have developed reward programs that require little more than supplying your name and address. In return, you get a card that you present each time you purchase something. In most cases, you automatically receive whatever discounts are currently offered in the store (eliminating the need to clip coupons from weekly flyers) and the dollar value of your purchases add up until you reach whatever of the reward level is. At that point, you receive a reward in the form of a coupon for future purchases. In the case of drugstore chain Duane Reade, one of our favorite programs, we get a $5 coupon for every $100 we spend. Duane Reade's competitor, CVS, has a similar program. Modell’s, a sports store, offers $20 for every $400. Staples, the office supply giant, rebates 10% on ink and paper purchases. As a bonus, many of these merchants participate in the Upromise college-savings program, so you get twice the savings.

Wednesday, June 17, 2009

Dickens' Financial Advice

In David Copperfield, Charles Dickens writes, "Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery." They are words for us all to live by!

Monday, June 15, 2009

Don't Buy More Than You Need

Buying only what you need may sound like a no-brainer to most readers of Top Tightwad Tips. But we're not just talking about stocking up on so much lettuce when it's on sale, that you can't possibly eat it before it wilts and turns nasty in the fridge. Sometimes it means scrutinizing re-occurring bills to make sure that you aren't paying for services that you aren't using. For example, you should regularly check insurance policies to make sure that you aren't paying for services that aren't important to you. If your family already has two cars, perhaps you don't need the clause that promises you a free rental car if your car is in the shop after an accident. And I remember when we were settling father-in-law’s affairs and was surprised to see lots of phone options he probably didn’t use or even understand: call forwarding, an unlisted number, etc. He would have saved $10-$20/month without these -- and he probably didn't even realize that he had them!

Saturday, June 13, 2009

Saving for College

If saving for college is one of your financial goals, sign up for membership at Upromise.com (and encourage friends and family to do the same). A certain percentage of purchases at affiliated web sites and retailers, participating restaurants, and linked credit cards will be set aside in a 529 college account for whomever you choose to designate. As an added bonus, from time to time you'll get specific additional savings (such as free shipping) as Upromise promotions.

Wednesday, June 10, 2009

Abraham Lincoln's Economic Advice

Abraham Lincoln said, “You cannot bring about prosperity by discouraging thrift. You cannot establish sound security on borrowed money. You cannot keep out of trouble by spending more than you earn.”

Tuesday, June 9, 2009

Don't be penny-wise...

... but dollar-foolish. In other words, take the long view when you think about saving money.

Here's an example of what not to do: years ago, my father-in-law went miles out of his way to buy ridiculously inexpensive gasoline. Everyone in the family wondered how the gas station could possibly sell gas for prices so much lower than its competitors. It turns out, the gas was watered-down and filled with all kinds of junk that ruined my father-in-law's engine. The cost for repairs were far more expensive than paying the regular price for gas would have been. So learn from his mistake, and beware of cheap deals that sound to good to be true (because, as with everything else, they probably are!).

Here's a similar example: don’t run around town to save a few cents on groceries, gas, or whatever -- not only are you wasting expensive gasoline, but your time has value, too.

Monday, June 8, 2009

Beautiful Hair at Bargain Prices

OK, we're in the greatest economic downturn since the Great Depression of the 1930s, but that doesn't mean you have to look terrible, too! Use these ideas save money while keeping your locks as lovely as always:
  • Try coloring your hair yourself, perhaps not every time, but at least every other time. Drugstore coloring concoctions are getting better and better, so if you haven't tried them for a while, now is a good time to do it.  At the very least, you can extend the time between salon visits by using Clairol's Root Touch-Up Kit, which covers your new growth and blends seamlessly with the rest of your hair.  Or just add pretty highlights with an at-home highlighting kit - look for the kind with a cap through which you pull selected strands of hair, for a subtle and natural look.
  • Try generic or lower priced shampoo, conditioner, and styling products – if they don’t work as well as your favorite salon product, then don’t buy them again. But you might be pleasantly surprised with their quality.
  • Check out "open house" nights at top-name salons, where the head stylist teaches his/her apprentices by cutting/coloring/styling the hair of volunteers (like you!). Here are some lists of salons that offer this service in major U.S. cities; if none of these work for you, call the salons in your area to see if they have a similar offer:
New York
San Francisco

Sunday, June 7, 2009

Money-saving Tips for Online Shoppers

Here are some more money-saving tips to use when you shop online:
  • Visit couponmountain.com for up-to-date free coupon codes, deals on computers and much more. This site also features promotional sales and online coupons from hundreds of internet stores. They update their code daily to help you get the best deals that only preferred customers usually receive
  • Go to refundcents.com for coupons, rebates, online discount codes, and grocery triple plays
  • Gottadeal.com features coupons, deals, and a lively forum with more money-saving tips
  • Check out the online coupons and cash back strategies at fatwallet.com
  • Ebates.com is the place to earn cash rebates for online shopping
  • Sign up for programs like Upromise.com to earn rebates every time you shop at affiliated sites.
  • Use Paypal.com when you shop to take advantage of exclusive deals and rebates.
As always when you shop online, be sure to search for online coupons for free shipping, etc. before you complete your purchase (to do this, type in the name of the site + the word "coupon").  Or visit sites like Retailmenot.com and FreeShipping.org, which offer thousands of free shipping codes.

Update: note that some online retailers always include free shipping to and from their warehouse (making returns extra easy).  As of 10/19/2011, these retailers include:
Athleta, DSW, eBags.com, L.L. Bean, Madewell, Piperlime, Revolveclothing.com, Sephora, Urban Outfitters, and Zappos.

Note: other top tightwad tips for online shoppers we've blogged about include our favorite bargain web sites and top tips for coupons.

Saturday, June 6, 2009

Your Freezer is Your Friend

When thinking about how to grocery shop less expensively, remember that your freezer is your friend. Stock up on meat, poultry, seafood, bread and other easy-to-freeze items when they go on sale. Wrap up all items tightly to prevent freezer burn. Be sure to label everything that goes into your freezer with a description and date - frozen food won't spoil, but it is tastier if it is used within a few months. And if your freezer isn't full - add containers of water until it is since emptier freezers work less efficiently and therefore use more electricity. Overall, I find it easier to shop less often and prepare meals in quantity and freeze the excess to use when time is short instead of fast food or take out.

Friday, June 5, 2009

Eliminate Disposables

Even if you factor in the costs to wash them, it is generally cheaper to use cloth napkins, real china, and silverware rather than use paper napkins and plates and plastic utensils.

Thursday, June 4, 2009

Save on Seasonings

Even if you aren't a gourmet chef, you can save money by growing your own herbs. Doing so will assure you that you always have the right amount available, without spending $1.39 when all you need is a tablespoon of chopped fresh parsley. And unlike, say, growing corn or potatoes, this is possible for almost everyone, even apartment dwellers like me, who can easily put a few pots on the window sill.

Wednesday, June 3, 2009

Top Tightwad Travel Tips

Going on vacation doesn't mean you have to break the bank. Here are some tightwad travel tips that will help make sure you get the most value for your dollar:
  • Plan ahead to use frequent flyer miles earned from other travel or credit card use (and note that sometimes miles are good for hotel charges as well as airline tickets).
  • If you'll be at one location for more than a few days, book a condo instead of a hotel room so that you can make your own meals and save on dining out.
  • Don't let your hotel overcharge you! Read The Insider Travel Guider's tips for avoiding the extra fees that hotels may try to add to you bill.
  • Use your prepaid cell phone to call loved ones at home (if you are traveling internationally, you might need to make a call to your service provider to ensure proper overseas coverage) rather than the hotel phone. Better yet, use Skype.
  • Don't be shy about taking advantage of freebies: if there is a coffee maker with complimentary coffee in your hotel room, why not use it instead of visiting the expensive coffee stand in the lobby? And if a continental breakfast is included in the cost of your room, by all means, don't miss it!
  • Get more for your money by asking the hotel if they will upgrade your room for free.
  • Avoid traveling to a destination at the height of tourist season when hotel rooms will be at their most expensive (and all the sights will be most crowded).
  • Plan your sightseeing itinerary carefully to take advantage of money-saving opportunities whenever you can. For example, many museums offer free admission at special times during the week, and with admission fees that are starting to top $20 per person, getting in for free represents significant savings. TheInsiderTravelGuides.com lists these free times for New York City, Boston, and San Francisco museums.
  • Remember that some of the most exciting and memorable experiences on your trip won't cost a dime. For example, whale watching on Maui, viewing the Thanksgiving Day Parade in New York City, and watching the Patriots' Day re-enactment outside Boston are all free.
    Even top-shelf entertainment can be found at bargain basement prices -- if you know where to look. For example, if your NYC plans include a Broadway show, look for tips on how to save big when you buy your ticket.
  • Make lunch your big meal of the day since most restaurants have a lower priced luncheon menu (but the food is often the same).
  • Consider using a restaurant discount card to save money when you eat out.
  • Whenever possible, bring your own refreshments into theme parks, museums, circuses, etc.
  • Skimp and splurge strategically at restaurant meals: for example, order tap water instead of soda or fancy bottled water, share an appetizer, but order the most fabulous dessert on the menu if desserts are your thing (you are on vacation, after all!).
  • Walk around whenever you can instead of taking taxis -- you'll get a better sense of your surroundings. Better yet, take public transportation like the locals.
  • If you rent a car, follow frequent renter's guidelines to avoid the extra charges that rental companies sometimes tack on.
  • Take advantage of rewards from frequent traveler programs associated with your airline, hotel, or rental car company, such as use of airport lounges or free upgrades.
  • Take advantage of insurance programs offered by your credit card company or existing insurer for rental cars and other travel expenses before purchasing separate policies.
  • Always ask about discounts you may get as a student; senior; or member of AAA, AARP, the military, or any other group.
  • If you don't already have a digital camera, buy one now before you leave for your trip -- the savings on film and photo development will more than offset the initial purchase price in a relatively short time.
  • Use your travel photos as mementos by making your digital photos into a screensaver or wallpaper for your computer instead of succumbing to the lure of junky souvenirs at each sight you visit.
  • Pack wisely, focusing on clothing articles that can easily be rinsed out in the sink and hung to dry overnight, so that if you spill something on, say, a skirt you had planned to wear more than once, you won't have to resort to costly hotel laundering or dry cleaning.
  • Instead of buying travel guides for each vacation, do your research via books at the local library or online.
  • The web is full of travel bargains. Sites we like for consistently good deals include CheapTickets.com and Hotwire.
  • If something goes wrong (as it invariably does when you travel a lot), take action quickly and politely and you may be compensated for your trouble (see online tips on lodging a complaint).

Note: these tips are courtesy of TheInsiderTravelGuides.com.

Tuesday, June 2, 2009

Best Bargain Web Sites for Frugal Fashionistas

For me, saving money isn't all about deprivation. I still want to enjoy beautiful clothes and accessories (especially my twin passions: shoes and purses) -- I just don't want to have to pay full price. In my ongoing quest for a bargain, I've developed a list of favorite shopping sites that offer true values:
  • 6pm.com is a new find.  My favorite features is the one that allows you to sort by percent off, a feature that I really like. If it isn't at least half off, why bother?
  • Bluefly doesn't always offer the steep discounts you'll find at Smartbargains, but the selection is nice and like Smartbargains, they offer frequent incentives on top of the already discounted merchandise if you sign up for email alerts.
  • Overstock.com has discounted merchandise in a number of different categories. I find that I have to do a bit more digging here to find things I really want, but it is still worth a look.
  • ShopItToMe.com works as your personal shopper - you fill out a profile with your size and the designers/retailers you crave most and they'll scour the Web, following up with e-mail alerts that feature the latest markdowns, secret promotion codes, and VIP sale events.
  • Smartbargains.com has undergone a revamp and seems to have fewer items and many fewer real deals, but it is still worth a look.
  • Quite a few retailers and catalogers, including Banana Republic, Gap, Old Navy, Talbots, Coldwater Creek, J. Jill, Soft Surroundings, Ann Taylor, and Lands End, provide sale or outlet sections online that offer substantial savings. You'll often find sales on these sites - with items in the 70-80% off range - even when they don't have discounted merchandise in their stores. Lands End's overstock section also has a special "on the counter" area, where merchandise is reduced even more throughout the week in sort of a reverse auction (for those who like to gamble a bit in pursuit of pinching their pennies!).
There are also a number of "members only" sites which are like online sample sales - sizes, colors and styles may be very limited, but the deals may be hard to beat.  I like:
Others, which I haven't used myself, include:
To get the best deals possible, always sign up for emails from these sites to get notices of special sales and email-only offers. You can also combine your savings from these sites with programs like Upromise (a collage-saving plan) and GoodSearch.com (which contributes money to your favorite charity).

As always when you shop online, be sure to search for online coupons for free shipping, etc. before you complete your purchase (to do this, type in the name of the site + the word "coupon").  Or visit sites like Retailmenot.com and FreeShipping.org, which offer thousands of free shipping codes.

Monday, June 1, 2009

Save on Books

I come from a long line of avid readers, married a bookworm, and together we produced two more book lovers. So it is no surprise that left unchecked, our tendency to aquire books to read would quickly take over every corner of our home, emptying our bank account along the way. Here are some strategies we've developed to keep that from happening:
  • Use the local library whenever possible. Even if our branch doesn't have the book we want in stock, they can use the inter-library loan system to obtain it for us.
  • Buy used books from Amazon and Barnes & Noble sellers (and then sell them back to someone else, when we're finished).
  • Check out other book web sites like PaperbackSwap.com.
Of course lots of other places to find books at bargain rates: for starters, look for school-sponsored book swaps, thrift shops, library sales, yard sales, etc. (it seems like everyone has books to sell!). A friendly reminder: as with everything else, if you are just browsing at these sales and end up buying books that you wouldn’t have otherwise, just because they were cheap, you really haven’t saved money in the long run.