Frugal ways to cut back

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Being frugal doesn’t have to mean being cheap. People often overspend or waste money without knowing it, and a simple analysis of your spending habits can help you find numerous ways to save money. Finding areas where you can reduce your spending without cramping your lifestyle will help you maximize your budget.

An analysis of your spending might produce eye-opening savings opportunities.

Create a Budget

Creating a budget lets you do more than set spending limits. By entering the amount of money you spend into your budget each time you make an expenditure, you’ll see where your money is going. You might be surprised to learn that those two cups of coffee you and your spouse buy each morning for $10 adds up to $2,500 annually — not including interest if you charge your java buys.

If you had used that money to pay down credit card debt, you’d be more than $3,000 ahead of the game. Keep track of discretionary spending, including lunches, CDs, clothing and other impulse buys to help you keep track of what you can cut back.

Analyze Your Utilities Cost

Lowering your heating and cooling costs will lower your monthly expenses and save you hundreds of dollars each year. Invest in a programmable thermostat that lowers your heat after you’re in bed and raises it 30 minutes before you wake up, and use it to lower the heat in your house while you’re away.

Experiment with the temperature setting on your water heater. Open and close curtains to let sunlight heat rooms during cold weather and to keep the sun out during hot weather. Contact your utility company and ask for a free audit of your home to determine if you’ve got doors and windows that are causing your heating and cooling bills to rise.

Low-flow toilets pay for themselves in three years, then save you money every year after that. Placing a plastic bottle filled with water in older toilet tanks will reduce the water you use each flush. Wash clothing and use the dishwasher only when you have full loads. Your lawn only needs about 1 inch of water each week for healthy root growth. Watering two or three times a week wastes water.

Reduce Your Debt

Because credit card interest gets added to your balance, you might not think of interest as an expense each month, especially since you don’t get an invoice or bill for it. Reducing debt not only saves you interest expense, but can raise your credit score, helping you get a new card with an interest-free balance transfer that could save you hundreds of dollars each year.

For example, transferring $3,000 worth of debt from a card with a 20 percent interest rate to an interest-free card will save you $600 annually. Consider temporarily suspending 401(k) contributions and using that money to pay down debt to cut your spending on debt interest. You might lose retirement money in the long run, but you’ll improve your financial situation now.

Improve your Car Maintenance

Keeping your vehicle in good shape will save you money on fuel, tires and oil. Find a local mechanic you trust and find out how often you should change your air filer, oil filter and oil and have your tires rotated. Having the right amount of air in your tires costs you nothing, but increases your gas mileage and helps your tires last longer.

Learn to Save Chic

Thrift stores that operate as charities get donations of high-quality clothing from people who want tax deductions for donating items. These stores are able to sell high-end clothing at bargain-basement prices because they have no cost to buy brand-name blouses, skirts, dresses, jackets, jeans and other items. Ask mom and dad to help out by having them buy items at half-price on senior day, if the store offers one.

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