Morningstar Article: 101 Ways to Cut Expenses
Number 30: Pay cash when possible--psychologically it’s harder to spend cash than using credit cards, and you’ll save on interest charges. Yeah, we all know it's a good idea to do this, but it's hard to actually put it into practice. When I do, I find that I definetly spend less.
Number 3: Use the public library to check out movies or books for free. I am a big believer in borrowing from the library. Now, if I could only remember to
And a few of the more drastic ones:
Number 76: Get a roommate and share expenses. Brilliant idea, but make sure you get the right person. I just moved in with a roommate, and it is really helping with my bills.
Number 63: Don’t get divorced. Hmmm. . .
And suggestions that could have been better:
Number 30: Check your credit history. Go to FreeCreditReport.com and make sure everything is accurate. Good credit may mean lower interest charges. It's a good place to add that everyone now gets one free credit report every year.
Number 74: Look up phone numbers in the phone book instead of paying for directory assistance. Actually, you can just dial 800-FREE-411 (800-373-3411), it's much easier and no need to lug the phone book around.
Numbers 25: If you own a house, shift your higher-rate credit card debt to a lower-rate line of credit. Deduct the interest on your tax return. And, Number 26: If you own a house, use a home-equity loan to pay off auto loans. The interest is tax-deductible.
Three reasons this seems like bad advice to me: (1) Without all of the proper discipline, it would probably make it very easy to run up all of the credit cards all over again. (2) If one had a financial disaster, all of their debt is now wrapped into their house, and missing a few payments could land you in foreclosure. If I had to, I'd miss a car payment or a credit card payment before I'd miss a mortgage payment that was higher because I consolidated all of my other bills into it. (3) Home Equity Lines of Credit are usually adjustable rates, not fixed rates like a car loan.
Anyway, check the rest of the 101 Ways to Cut Expenses yourself. Next, I'll update everyone on my 2005 Financial Goals and how they turned out.