Advice on how to save money often focuses on the importance of “small things” – stop buying $4 lattes every morning, cancel your cable TV and magazine subscriptions, and so on.
While these “small savings” can indeed add up to some significant amounts of money, the amount of time and effort that you put into scrounging up extra dough is often substantial as well.
What if you really want to save some big money? It’s time to stop thinking small, and think big.
Consider this idea: What if you could save more money on the purchases where you spend the most? After all, our financial lives are about more than just minor daily or monthly transactions and recurring bills; much of our financial picture is determined by how much we spend (or save) on a few big buys.
[Mortgage Help: Get your free credit report and see if your credit score is mortgage qualified]Housing – stop “stretching” and start saving
Housing is most people’s biggest monthly expense – making up 28 to 32 percent of total income. Unfortunately, as the recent housing bubble and crash have shown, many people do not look to save money on their housing payments. If anything, we as a culture have taught ourselves to “stretch” to buy more house than we can comfortably afford.
What if you chose a smaller, more affordable house? You could save hundreds of dollars a month on mortgage payments, taxes and interest – and tens of thousands of dollars over the course of a 30-year mortgage. That makes up for a lot of $4 coffee drinks.
Are you a renter who lives alone? Consider getting a roommate to save on rent. Find someone you trust, through your existing group of friends and family. Or if you have a big house with too many empty bedrooms, consider renting out a room to earn some extra income.
Communal living can be a bit stressful, but if you establish clear expectations up front about how you want this living arrangement to work (and sign a contract so both peoples’ interests are protected), renting out a room (or sharing a place with a friend) can make for a happier home and a happier budget.
During the housing boom, “house flipping” became a new national pastime as Americans constantly climbed their way up the property ladder. All those home renovation reality shows on HGTV are hiding an inconvenient reality – selling a house is expensive. Buying a new house is even more expensive. If you’re constantly buying and selling houses, chances are you’re not really getting ahead financially.
Every time you sell a house and move to a new one, there are huge costs to pay – closing costs, paying your real estate agent, home inspection fees, not to mention the new (often larger) house payment awaiting you at your new address.
Buy a house you love, and stay in it. It is often more affordable (and less stressful) to fix up your existing house rather than buy a new one.
Whether you’re a renter or a landlord, Quizzle.com can help you manage your money with great tools and resources. With Quizzle, you can find out if you can save money on your home loan, improve your credit, and create a more secure foundation for any stage of life.
Update: Read part two of Want to Save Money? Think Big!