Tag Archives: saving

10 Unexpected Debt Traps – and How to Avoid Them

Staying debt-free doesn’t seem that hard in theory. All you need to do is spend what you can afford, right? Well, the millions of Americans in debt would disagree. It is not that simple. Anyone can easily sink into debt if they don’t have the right attitude towards spending and money management. 

Many people have the “buy now, pay later” mentality. If you don’t want to slide into the debt hole, here are 10 things you should avoid.

Paying Off Debt Using Savings

When you have a high-interest debt and some money in a low-earnings savings account, you may see it wise to pay off the debt with the money. But this strategy can blow off in your face. You will end up making things harder for yourself. You will not have any cash for emergencies. If you get an unexpected expense, you will be forced to borrow again to take care of it. 

Splitting Cash for Bill Payment

Say you have an extra $600 and decide to send $200 to three creditors or $100 to six creditors. This is not as smart as it appears to be. Small payments will not make much of a difference. Focus on one debt at a time.

Subscription Plans

Most subscription plans don’t cost that much. So you sign up on a number of them. When you add all your plans up, you will see how big of an impact they have on your savings and other goals.

Financial Purchases

You can buy anything with financing nowadays. What you don’t know is that with financing, you end up paying more. And you will also start buying things you don’t necessarily need.

Long-term Auto Loans

With most institutions, you can now finance a car for up to seven years. You may not even keep it working for that long. Always opt for a shorter period and a cheaper model.

The Rewards Game

With credit cards offering rewards, you may find yourself charging more purchases to win the rewards. but just keep in mind that you will have to pay off the balance plus interest rates.

Trying to Please People

Some people get into debt while trying to make others happy. You want your spouse to have a nice vacation or the children to enjoy their holidays. Communicate with your loved ones and help them manage their expectations.

Lack of Financial Planning Knowledge

A good number of Americans don’t know about financial basics. They have no idea how rent-to-own agreements, payday loans and other plans work. Fortunately, there are a lot of apps, websites and financial books with all the knowledge you need.

Ignoring Options

Almost all the purchases you make are optional. A new car is not a necessity and neither is that expensive degree you are financing. If there is a more affordable option, go for it.

Assuming That Debt is a Way of Life

Tons of people believe that debt is normal. There is no way to be debt-free. But you can change your mindset and be intentional about finances.

10 Easy Tips To Save Money On Your Home Heating Bills

With energy costs higher than they have ever been in recent history, it pays to find ways to reduce your home heating costs. I put together some tips that are easy, cost effective and will all add up to reduce your home heating bills by a significant amount! You don�t need to be Bob Villa either. Some take just a minute or two. Even small changes will add up to big savings over the course of this cold winter!

Here are the 10 tips that I have personally used to save on my home heating costs:

  1. Head down to the basement and reduce the setting on your hot water thermostat by about 10 degrees. I wouldn’t go below 120-115 degrees. The adjustment dial is typically a red knob towards the bottom of the water tank.

  1. While you are downstairs, make sure you have clean filters for your central air-heating unit. A dirty and clogged filter will force your unit to work much harder and stay on longer as it struggles to fresh air through the clogged filter to heat the rest of your house.
  2. Check your air ducts for gaps, leaks or disconnects. If you have any disconnects or leaks in your duct-work, your heating bills could be 25% higher than they need to be if these gaps were sealed. If you can’t do this on your own, hire a professional. This expert can also clean your ducts for added efficiency.
  3. Adjust your thermostat a few degrees lower. Believe me, this really adds up. It may not seem like much of a difference to you, but you will notice the difference when you get a lower bill each month!
  4. While we are on the subject of thermostats, consider replacing yours if it is not programmable. The reason is, you can set the thermostat so the temperature setting in your house is lower at night than during the day, when you are awake. Also, if you are away at work during the day, you can set it for a lower temperature and have it programmed to start heating the house a little bit before you come home. These aren’t too expensive and are easy to install and configure yourself.
  5. Insulate your attic. Heat rises, right? If your attic isn’t properly insulated, all of the heat in your house (and your money) goes right through the roof. Literally! This does require some effort on your part, but following through on this tip will save you a ton of money over the years. Measure the square footage of your attic and buy rolls of insulation, greater than R-13 but no higher than R-30. Wear a mask and gloves when working with insulation because it irritates the skin.
  6. Find those leaks and cracks! If you were to add up all of the small cracks and holes in your house, they would probably add up to a small window, wide open, letting cold air in and hot air out. Take the time to find gaps in windows, doors, pipes, electrical and phone lines, your dryer duct and much more. Put weather-strips around your doors and windows. You can buy insulation foam that comes in a can with a straw at the top that allows you to fill in tight spaces. It expands to fill even the smallest cracks. Of all of the tasks, this was the most fun finding and filling these gaps all around the house.
  7. Close the vents in rooms that you do not use. I have one room in my house that is not currently in use. I shut the hot air ducts and made sure the windows and doors were properly sealed to limit energy leakage. Why waste your money heating up extra square footage of your house that you don’t even use?
  8. Open drapes and shades for all of your windows during the day to let the sun heat your home. In the evening, pull them back down for added insulation. It is amazing how much direct sunlight streaming into your home helps to heat things up.
  9. Your fireplace can help and hurt your heating costs. If you are not using your fireplace, make sure the damper is closed. When it is closed, inspect the damper and feel if cold air is still leaking in. If you are using your fireplace, make sure the heating in the rest of your house is reduced or turned off.

Taking the time to implement these tips will drastically reduce your home heating bills. You can get most of them done in just one day, but the payoff will last for as long as you live there! I followed through on each one of these tips and the following winter, my bills were about 25% lower, saving about $100 a month! So roll up your sleeves follow these tips and start saving money on your heating costs!