Personal Finance 101

1. Repair Your Old Clothes

Don’t throw old clothes. If you get to see how people in poorer countries live, you’ll learn to appreciate the clothes that you have. Sew your torn clothes and wear them. Don’t rush out and buy new clothes every other week.

2. Ask for a Rate Reduction

Ask and ye shall receive. At the risk of having NPL’s (Non Performing Loans), banks would rather lower the interest they charge you than to have you default on your debts. So don’t be shy in asking. You wont lose anything by asking. I managed to get a 200 dollar reduction in my monthly mortgage repayment, which actually allowed to me to keep paying my old rates and reduce the principal amount of the loan quicker.

3. Say NO to Starbucks and McDonalds

While the coffee from Starbucks might be slightly better than a regular Java, is it worth the USD8 that you pay for it, compared to the USD2 for a regular Java? The USD6 that you save on a daily basis comes up to USD180, which can reduce your credit card interest charges by a considerable margin. And the Big Mac from McDonalds might send you to the hospital with a cardiac arrest. Say NO to FAT. And while you’re at it, stop smoking and reduce alcohol consumption. All these will add dollars into your pocket and increase your life span.

4. Switch Your Bulbs

Switch all the bulbs in your house into energy saving bulbs. You’ll start reaping your savings within 10 months. And besides, you’re doing your bit for the environment.

5. Swap Books with Friends

Check out Craigslist for people who want to share books. Swap books with them, or friends and family. You’ll end up reading a lot more books for a lot less dollars.

Here are some simple ways to save some money.

1. The best way to save is to build a LIST of specific bargains that you find over time. This will save you a lot of TIME and MONEY.

2.  Turn off the power of unused items in your house. Do let let your TV or VCR to lay idle in Sleep mode because their still consuming power. Contrary to what manufacturers say, your TV.VCR, cooker, Hi-fi do not stop consuming power when their idle. They still consume 2/10 of their usual power. Compound this over the whole night of 12 hours and you’re paying for a lot of wasted electricity. So take out the plug from the wall.

3. Drink water instead of soft drinks. Not only is water cheaper but it is also healthier and will not make you FAT.

4.  Learn to trade or share with friends. Borrow a toaster, car pool whenever possible, borrow and lend books – all these little things help save money.

5.  Make your own lunch. While this sounds like a lot of work, making your lunch is cheaper and much healthier.

6. Pay off your credit card debt in full every month. The interest every month on the carry over balance will kill you if you let them compound. Compounding interest is good, when it works for you, not against you.

7.  Look for opportunities to switch credit cards when possible. A 0.25% lower interest can result in hundreds of saved dollars in a year – enough for for a vacation!

8. Switch to debit cards. Then you wont end up over spending.

9. Do not use your credit card. BUT do not cancel them. Having a credit limit but not using it helps build credibility when its time to get a home or car loan.

10.  Cut down on drinking and smoking. I am not asking you to eliminate the habit completely. But cutting down by 10% saves you 10%.

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