With the costs of basic necessities rising and wages stagnating, minimizing unnecessary and wasteful spending is more important than ever.
For instance, your daily corner coffee shop fix could drain over $1,000 from your bank account each year, according to a recent survey.
Fortunately, there are several ways to cut costs, especially in this sluggish economic recovery. And below are some of the most common places you can start making changes to help make ends meet:
In 2012, banks generated $32 billion in revenue in overdraft fees. And with even the most money conscious consumer overdrafting on their account once in a while, it's important to protect yourself. One way is to consider opting out of overdraft coverage. Since 2010, a federal law requires customer consent before a bank can process a non-recurring debit card or ATM transaction that results in an overdraft and, consequently, an overdraft charge. Or consider signing up for overdraft protection. For as little as $5 to $10 a year, you can save hundreds of dollars by linking your checking account to pull extra funds from your savings account or line of credit.
The option to secure an extended warranty is often offered when purchasing a major item like a television or laptop. But the truth is that many of these products are fairly reliable. And if a malfunction occurs, it will mostly likely occur within the manufacturer's initial warranty period, or well after any extended warranty has expired. A better option: warranty protection on your credit cards. Most credit cards double the manufacturer's warranty on purchases, which will add another year of free protection.
Unused Gift Cards
Do you toss dollar bills in the trash? Probably not. But this is essentially what happens when we leave gift cards unused and retailers and the states, in which the card was sold, absorb their value. According to one estimate, $41 billion worth of gift cards went unredeemed from 2005 to 2011. Don't forget that you have gift card rights. Under federal law you can use your gift card for at least five years without expiration. And if you do not intend on using your gift card, you can try selling it for cash online.
More people are enrolling in college and/or training programs to get a leg up in the job market. And with college tuition escalating, textbook costs can break the bank. Fortunately, there are websites that identify which companies have your textbook available to rent at a fraction of the costs. Also, consider asking your professor if a copy of the textbook is on reserve in the library. Many professors put one on hold for students to take out on loan for a couple hours at a time.
In this economy, every penny counts. By making some of these (and more) subtle changes in your lifestyle, you can diminish the amount of money you waste and build your financial security down the road.