Monday, December 16, 2019

Personal Finance Review



Even if Benjamin Franklin never actually used the expression "a penny saved is a penny earned", the reality is that it has been a sentiment for frugality for centuries.  He did say: "Beware of little expenses; a small leak will sink a great ship."  At the end of the day, it is not about how much you make as much as it is about how much you keep.

The first step in a personal finance review is to discover where you are spending your money. It can be very eye-opening to have a detailed accounting of all the money you spend.  Coffee breaks, lunches, entertainment, happy hour, groceries and the myriad of subscription services you have contribute to your spending.

This revelation can lead you to obvious areas where savings can be accomplished.  The next step is to dig a little deeper to see if there are possible savings on essential services.

  • Get comparative quotes on car, home, other insurance.
  • Review and compare utility providers.
  • Review plans on cell phones.
  • Consider eliminating the phone line in your home.
  • Review plans on cable TV, satellite for unused channels and packages or receivers.
  • Consider entertainment alternatives for cable like Hulu or Netflix.
  • Review available discounts on property taxes.
  • Consider refinancing home ... lower rate, shorter term or cash out to payoff higher rate loans.
  • Consider refinancing cars.
  • Call credit card companies to ask for a lower rate. 
  • Consider transferring the balance from one card to a new card with a lower rate and then, pay off the balance as soon as possible.
  • Review all the automatic charges on your credit cards ... do you need or still use the service?
  • Discover late fees that are regularly being paid and eliminate them.
  • Review all bank charges for accounts and debit cards; determine if they can be reduced or eliminated.
  • Pay your bills on time and avoid all late fees.
  • Monitor your bank account and avoid over-draft charges.
  • Some companies have customer retention departments that can lower your rates to retain your business.

A strategy that some people use is to report their credit cards as lost so new cards will be issued.  When they are contacted by the companies to get a valid credit card, they can determine if the service is still needed.

The money you save can ultimately help you in the future for a rainy day, an unanticipated expense, a major life event or retirement.  Cutting back now will give you more later, possibly, when you need it even more.  Tennessee Williams said "You can be young without money, but you can't be old without it."

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