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These days everyone is looking to save money. Coupon clipping is becoming a very popular hobby. Getting a deal is a great idea but it shouldn’t be the main goal. Many times people hoping to save money end up being penny wise and dollar foolish. To really get the best bang for your buck you have to be strategic in where you invest your money and time.
Here are some common mistakes of penny savers and how to become a dollar saver instead.
Mistakes to Avoid
Chasing deals and missing deadlines – With family budgets shrinking, many parents, especially moms have turned to couponing and sale chasing to stretch their family budget. This is a smart idea; however, you can take it too far. Some get so involved in coupon clubs and chasing deals they start slacking on their other financial tasks such as bill paying. They are racking up $39 late fees and finance charges while they are saving $2 on toothpaste.
Not valuing your time – Most people don’t realize how much their time is worth. If you are an hourly worker, that’s easy. For most salary earners you can take however many thousands you earn in a year and divide by two. For example $40,000 is $20 an hour and $60,000 is $30 an hour. So now when you take on a task you can figure out if it really is worth your time. Suddenly driving half an hour to save 5cents on gas doesn’t sound that smart.
Not investing the savings – This is the most crucial part of saving money – investing the savings. When you save with coupons what do you do with the savings? Do you actually save it in the bank or do you end up spending it elsewhere. To really save money you must have a plan to do something with the savings; otherwise you are just wasting your time. Money magazine recently had an article on Super Savers and featured ordinary people saving 30% or more of their income and putting the money in the bank.
Take Advantage of the Internet
Pay your bills online – You can sign up for online payments and alerts with most companies today ranging from your power company to your department store credit card. They send you reminders of when your bill is due and then you simply pay online. This avoids postage, late fees and missed payments. If someplace doesn’t offer it, for example your child’s preschool, you can simply set up an automatic draft from your own online bank. Your bank will print and mail a check every month for you. Paying your bills on time is the single most important factor on your credit report.
Stay on top of your credit report – Your credit report can help you save thousands of dollars if you maintain it well. Your credit score is becoming a more important factor in all your financial matters. It can determine how expensive your home and car loans will be as well as how good of a salary you can get. Make sure you view your credit reports at least once a year for FREE via www.AnnualCreditReport.com.
Invest online – No matter how little or large you have to save consider opening an online savings account. Online banks typically offer higher interest rates. Even better they offer more online tools to help you save and plan. You can maintain your local bank and simply transfer money electronically between your online and local bank. ING Direct is an online bank that allows you to create several connected accounts so you can set up automatic savings and transfers in your vacation fund, Christmas shopping fund or any other savings goals. And saving money in a bank should be your ultimate savings goal.
Christmas is four days away. Are all your gifts under the tree? Shoppers in the Northeast have a blizzard as their excuse for not finishing their holiday shopping this weekend. What about you? What is your excuse for not finishing your shopping? Well, no matter what your excuse we are here to help you wrap it all up before Christmas Eve.
For last minute shoppers here are some gift ideas and tips for getting your gift shopping done quicker than Santa can come down the chimney.
Tips
Don’t roam the mall aimlessly – As always, have a game plan and shopping list before you go out shopping. Check out retailers’ websites for ideas and then head to the mall. To make your mall trip even faster, download a mall directory from your mall’s website so you can find your destination stores quickly.
Don’t expect 2008 – Retailers last year got burned with way too much inventory and not enough shoppers. This year, retailers have dramatically cut back on their inventories. So if you expect to find stores overflowing with merchandise with lots of gift options just a few days left until Christmas, you will be in for a surprise. Selections and choices will be limited.
Suggestions
To make shopping easier here are some suggestions for last minute gifts:
For parents with young kids – Parents with young kids love taking photo after photo of their kids. Yet they rarely print all those digital pictures. To get them inspired to start printing pictures, give them a gift certificate to a photo printing site like Shutterfly or PhotoWorks
. You can send these gift certificates electronically too.
For teenagers – One favorite store for teenagers is Old Navy. And they are currently running one of the best gift card promotions around. Until Thursday, you can buy gift cards for 20% off. So you can buy $100 worth of gift cards for only $80. Couple that with coupons from ShoppingQueen.com and you can save even more.
For anyone with an iPod – iPods used to be toys for techies but now everyone from soccer moms to teens to business executives carry iPods. To complement their iPod get them an iPod dock and speaker system. There are so many models in a variety of price ranges, you are sure to find one just right.
For frugalistas – With this economy, many people are discovering the joys of coupons and discounts. For your friends and family who like to save money, a 2010 Entertainment book would make a terrific gift that keeps giving throughout the year. These books feature hundreds of coupons for restaurants, services and stores. They are $35 and can be found in drug stores and bookstores.
Shopping at Amazon.com
– If you really want to send your loved one an actual gift, Amazon.com is your best last minute destination. They carry a huge selection of products with quick delivery options. Instead of paying express shipping charges, consider enrolling in Amazon Prime to take advantage of shipping discounts. For Prime members, Amazon even offers express local delivery in select large cities for orders placed as late as Christmas Eve. You can cancel your membership later if you don’t shop as much as you thought.
Options of last resort – If all the stores have closed and you still need gifts, here are some options of last resort:
Magazine subscriptions – Hearst Magazines has a holiday sale with many popular magazine subscriptions priced only $5 a year. Selections include: O, The Oprah Magazine, Cosmo, Good Housekeeping, Car & Driver and Smart Money. You can give a gift subscription online and no one will know you paid only $5.
E-gift certificates – If you missed your chance to give them an actual gift card, you can send them an e-gift certificate. Many online stores from Ann Taylor to Toys R Us now offer you the option of an e-gift certificate.
You can almost smell the turkey now. Thanksgiving is just a couple of days away. You can look forward to a festive day filled with lots of fun, lots of family gossip and loads of carbs. So while the gym may be open the next day, there is an even better way to burn those carbs – shopping. Yes, the Day After Thanksgiving sales are this Friday. With so many sales and promotions, it’s hard to know where to start.
Here are the Do’s & Don’ts for The Day After Thanksgiving so you DO end up with deals that DON’T break your budget.
Do’s
- Do your homework – Before showing up at a store at 5am just to join the crowds, do your homework. First make a shopping list of all the gifts you need to buy and the amount budgeted per gift. Second browse the Black Friday ads either in your newspaper or online at bfads.net or dealnews.com/blackfriday
- Do shop on Thanksgiving – Physical stores may be closed on Thanksgiving, but online stores are open and brimming with deals. Many retailers will offer special Thanksgiving Day deals and promotions to entice you to step away from the turkey and shop. If you want to shop at physical stores, wait until night time and hit the outlets. North Georgia Premium Outlets open at 12am on Friday.
- Do know price match policies – Instead of running around town from store to store, ask your favorite stores about their price matching policies. Many stores will honor the price in a competitor’s ad, you just have to ask and show the ad. However limited quantity or time items may be excluded from these policies. Target and Wal Mart are in a particularly fierce battle and look to sway the other’s customers with price matching. Dealnews.com has a nice price match policy reference list along with customer service numbers.
- Do learn the return policy and get a gift receipt – Stores have gotten even more stringent with their return policies this year. Make sure you know how and when an item can be returned. It is also helpful to provide a gift receipt with the gift. This is most important when purchasing electronics as many times they have limited return periods and even restocking fees.
- Do dress appropriately – Shopping on Black Friday can become a long day. Make sure to dress in warm layers that you can adjust as you go through the day, especially if you plan to be start shopping at 5am. Keep other items to a minimum. Bring a small bag and only the credit cards, checks or cash you need that day, not your regularly packed wallet.
Don’ts
- Don’t leave the house without a plan – If you don’t know what you are buying or whom you are buying for don’t go shopping. Hitting the stores just to go deal shopping is no deal at all.
- Don’t buy for yourself – The purpose of Black Friday is gift shopping. You are looking to save money on gifts for others not gifts for you.
- Don’t rush to buy, especially electronics – Let’s be honest, you’re not standing in line in the cold at 3 am to buy an LCD TV for your uncle Bob or your kid’s teacher. You are buying these expensive electronics for yourself. If it’s for yourself, wait until after New Year’s to buy. You can get a better deal then and avoid the crowds. New electronics come out in early spring and stores will have lots of promotions on existing models early in the year.
- Don’t forget about coupons – It’s easy to get overwhelmed by all the sales and promotions but don’t leave money on the table by forgetting to use coupons. Stores have many coupons this time of year, so pair them with the sales and get even more savings. ShoppingQueen.com will feature lots of printable coupons.
- Don’t worry about missing out – Black Friday is no longer the only big shopping day. So if you didn’t get all your shopping done, don’t worry. Cyber Monday is next week and you can take advantage of sales and promotions online. Tune in next Monday to hear how to snag the best deals on Cyber Monday.
Are you looking forward to February? Yes, it’ll be nice to get flowers from your honey on Valentine’s Day. But even better is getting credit card reform from Uncle Sam. The Credit Card Accountability Responsibility and Disclosure Act or Credit CARD Act for short was signed into law this spring and most of it goes into effect next February. It is the most wide ranging credit card reform we have ever had and it couldn’t have come at a better time.
Wondering what all the reforms mean to you and the cards in your wallet? Here’s what to expect.
Rates
The most important part of the new law will be its rules on rates. However, the key to taking advantage of all these benefits is to make sure you pay your bills on time. If you’re not a good customer the bank will not be nice in return.
- Retroactive rate increases or universal default are now banned.
- There can be no rate increases in the first year unless you have a promotional rate.
- If you have a standard fixed rate, your rate stays the same for the life of your balance.
- You have to be notified of future rate increases to your standard fixed rate at least 45 days in advance. AND the rate increase would only apply to new purchases not your existing balance.
Payments
- Before issuing new cards or raising limits, banks must consider your ability to make the payments. Credit will not be as easy to come by as before.
- Payments will be due at the same day and time each month.
- Your payments will be applied to your highest interest rate first.
Fees
- Over the limit fees can only be charged once per month and only if you have opted in to this fee. If not, your transaction will simply be declined and you will have no fee.
- Penalty fees such as late fees must be reasonable as deemed by the Federal Reserve Board.
- Your finance charges must be based on your current balance not your previous balance.
College Students
- No more free T-shirts. Credit card companies can no longer offer any freebies or other incentives to young consumers for filling out a credit card application.
- Everyone one under the age of 21 must have a co-signor unless they can provide proof of their own independent income.
- Marketing by mail and on campus will be limited.
A Good Resource
Consumer Reports has put together an easy to read overview of all the changes on their Credit Card Reform website.
