Small Changes can add up to Big Savings

Not every financial decision has to be a large, dramatic affair. In fact, sometimes the small changes are the most effective because they are the most realistic, and can actually be implemented immediately. Here are some ideas for changes that won't alter your lifestyle, but may very well change the financial landscape of your life:

  • Call your credit card company and tell the service representative that you're going to change cards in order to get a lower interest rate. Keep the pressure up; insist on talking to a supervisor if you must. Your objective here is to negotiate a better rate with your existing credit card company because it doesn't want to lose your business. Although this may be difficult, it certainly is not impossible. If your current card company won't budge, find another.
  • Pay close attention to bank charges on interest-bearing checking accounts. Often the monthly fee charged is greater than the interest paid; if so, you'd better off with a no-interest or free account. Examine the detailed charges so that you know exactly what you're paying.
  • Constantly be on the lookout for better long-distance and cellular phone rates. These rates change constantly and the competition in the marketplace is fierce, but you have to be proactive in order to get the new discount. Many companies are happy to renegotiate a contract because it will lock you in to a longer arrangement, but if it's a better deal that's of no concern. But when asking for the latest promotion, be careful. Free minutes are not what are important. The overall cost per minute is the thing that matters most.
  • Whenever possible, buy generic. What difference does it make about brand names when it's a bottle under your kitchen sink? The same goes for body creams and bath products that are private labeled (that is, they're packaged for a particular store as its own brand). The same manufacturers who provide products for lower-end retailers generally make the products inside those expensively labeled name-brand wrappings. The difference in price is due to the packaging, not the quality of the product inside the package.
  • Increase your 401(k) contributions by 1 percent. An extra $500 per year from a $50,000 salary could give you an additional $9500 after 10 years.
  • Plan your major shopping excursions with cash only. Decide what you can afford to spend on back-to-school clothing for the kids (or whatever it is that you need) and take only that amount with you in cash when you shop. Leave your credit cards and checks at home. It really does work; there's something about handing out hard-earned cash that makes you stop and think about the value of your purchases.
  • Keep one credit card on ice, literally. Yes, it does sound unusual to say the least; but it, too, can be quite effective. Take one of your active credit cards, freeze it in a tray of water, and leave it there. When the urge strikes you to buy something of significance that you couldn't otherwise afford, go home and decide if it's worth thawing out the card to make the purchase. This is a tried-and-true method of slowing you down so that you'll take the time to actually consider your purchase. Chances are that you'll rarely use that card. But it'll be there if and when you really do need it.

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