Wondering how you can save $300 in one month? Here are four tips:
1. Stop paying for credit monitoring.
These services charge $10 – $30 / month for something you can do yourself for free. Simply visit www.annualcreditreport.com every four months and pull one of your reports to review its information. Note that reviewing the information in your credit reports is different than checking your score. You can get your score free on sites like Credit Karma, but beware that the score you get from these sites does not reflect your actual score.
Depending on what you are applying for (home, car, credit card) your score will vary because of the amount of money (risk) the lender is considering varies. For example, if you are applying for a home loan, your score will be a few points lower than if you were applying for a $5000 credit card line of credit because the lender is taking on much more risk with a few hundred-thousand dollar mortgage loan.
2. Avoid overdraft / late / over the limit fees.
Overdraft fees can be $35+ per occurrence, which can really break a budget. If you haven’t already, ask your bank to have your debit card declined when you swipe without having the funds in your account. Some banks charge per charge as opposed per diem. So if your bank account balance goes to zero one morning and you don’t know it, and you charge 5 things through out the day, your bank could hit you with FIVE overdraft charges in one day. At $35+ / pop that’s $175.
It’s the same story with late fees. Each late fee can be $35 – $39. Typically you have a grace period of 30 days before a late fee will be charged. I recommend opening your mail and paying bills once a week. Do whatever it takes to ensure you pay your bills when they are due. I recommend setting up automatic payments from your bank account (online bill payment) for those bills that are the same each month. For those that aren’t (electricity, cell phone, etc.) set a reminder on your phone calendar for when to send payment.
Over the limit fees are also a budget-killer. At $35 – $39 each, they are an expensive thing to overlook. If you are approaching your credit limit on a credit card, do not exceed it! The company will charge you each month you are over. The scenario I see most often is interest capitalization causing the overage. For example, let’s say your credit limit is $1000 and you spend $995. The interest you’ll be charged on $995 can cause you to go over your limit if you only make the minimum payment. Be careful!
3. Ask your utility companies for a hardship plan.
Many service providers have programs in place to lower utility bills for those in financial hardship. If you truly need to save $300 so you can feed your family, pay rent, or to pay for transportation to get to work, ask your provider what they can do to lower your payment during hardship.
4. What hobby is causing you to spend money unnecessarily?
If there’s something in your lift that is not contributing to your well being and costing you money at the same time, stop doing it. For example, are you having 5 drinks at a bar when you go out? How about brining that number down to 2 – 3. At $10 / each that will save at least $20 each time you go out. Are you gambling? Playing expensive video games? Gaming on your phone? Or smoking? Taking the toll on the way to work? What things can you do less of that cost money or habits can you change that cost money? If it’s the expensive toll road that’s eating up $100 / month, try working different hours to avoid the rush. Or work from home. Or get up earlier or stay later. If it’s phone app games that require $1 here or $2 there to level up or get more weapons / coins / etc., replace that gaming habit with something free, like taking a walk, or calling a friend. If it’s smoking, I don’t think I need to say it, but at the very least try cutting down if quitting isn’t an option.
Holly is an award winning financial coach, entrepreneur, and speaker. She is a Certified Financial Health Counselor, Certified Student Loan Counselor, and Accredited Financial Counselor ®. Her unique background in business, corporate America, and real estate give her a broad perspective to help her clients create wealth, stop living paycheck to paycheck, and eliminate debt.
Holly began teaching personal finance in 2006 to young adults as a service project with Rotary International. Her workshops were so popular she decided to teach personal finance full-time so she could help more people. She created The Financial Impact System, a step by step guide to master your money, streamline spending, protect your money, and create multiple streams of income.
Holly is originally from Boulder, Colorado. She received the prestigious “Rotarian of the Year” award in 2007/08 for her work in financial literacy. Holly served as Treasurer of the Erie Rotary Club from 2006–2009. She has a B.A. in International Business & Japanese from the University of Colorado. She now resides in Denver, Colorado. Holly also plays competitive beach volleyball year-round, practices yoga, and loves to hike with her two dogs.