As the flowers begin to blossom and the temperature continues to rise, our eagerness to spring clean the house is in full swing. But don’t forget the most important area in your house to dust off, your finances.
Your budget and spending habits could always use a little cleaning up, and what better time to do this than during spring cleaning season.
Let’s take a look at these five different ways you might be able to dust off those extra expenses and save for a rainy day.
First, Get Rid of Clutter
Clean any expenses that are unnecessarily dragging you down, such as:
• Subscriptions to magazines or other services you rarely use.
• Pricey cable subscriptions. Do you really need that 300-channel package when you watch maybe 10 channels regularly?
• Monthly gym memberships when you know you’re never really going to go to the gym, as much as you say you will.
• Late fees, convenience fees and other charges you could eliminate if you just planned a little more in advance. Automate your bills to avoid late payments. Plan out your meals in advance so you don’t find yourself grabbing fast food on the go. An ounce of prevention, as they say…
Next, Manage Your Reoccurring Payments
When you have regular recurring expenses, it’s easy to “set it and forget it” — you analyze the costs when you first sign up, then keep paying the same amount every month out of sheer habit. Take a look at your ongoing payments to make sure you’re still getting a solid deal.
• Your cell phone plan. Do you really use all those minutes? Can you cut back on your data plan?
• Car insurance. Can you take a safe driving course to get a discount?
• Homeowner’s/renter’s insurance. Do you have all the coverage you really need?
• Multiple-policy discounts. Can you bundle any of your services to save even more?
Then, Review Your Budget
Now that we’re near the second quarter of the year, your New Year’s goals might need a little adjusting. Unexpected expenses might have come up these past three months, so now is the time to get your money mind back on track. Or maybe you earned more than anticipated this past quarter and would like to reward yourself. Wendy Weaver, a certified financial planner and portfolio manager at FBB Capital Partners, which serves Maryland and Virginia, suggests rewarding yourself with part of that money. “If you’ve gotten a raise or a bonus or a tax refund, go ahead and spend a little bit of it on something fun like [a] vacation and take the balance of it for savings or paying off debt,” she says. “But make sure you’re regularly saving to your emergency fund and retirement accounts.”
Don’t forge to Maximize Your Savings
Automate your savings so that a certain amount is deducted from your checking account or paycheck every period. Send that money into a savings account. Make sure your savings are in an account that pays a decent interest rate.
“Out of sight, out of mind,” is the easiest way to keep yourself from dipping into the money to meant to put aside.
Finally Check Your Credit Score!
This is an important step that so many people neglect. Credit makes a huge impact on everything from your insurance rates to your ability to rent an apartment or refinance a mortgage.
If you’re not monitoring your credit, you’re putting yourself at unnecessary risk. And you might be paying higher interest rates, higher insurance premiums, or other fees as a result of “bad credit” that’s the result of a simple, solvable error.
You’re entitled to a free credit check from each of the major credit reporting agencies (Experian, Equifax and Transunion) once a year. Take advantage of that benefit. The best way to monitor your credit is to check once every four months (e.g. January, May and September) with one of the three credit agencies, in rotation. If you spot an errors, report it to the agency immediately.
Now that your finances are dusted off, sit back, relax and enjoy the smell of fresh roses blooming in your garden.
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