Advice on cutting finances/saving money

[azanon]

The whole saving **** is bull****. You have people who preach it as a way to get rich, but it's not. Saving is bull****. Trust me, I know people who save and people who have saved all their life.

I once read this book saying that the only difference between different classes in America is how much they save. What a stupid thing to say.

What kind of person works his entire life? Someone like this guy.

Just because you may know someone who saved, and never used what they saved at a later date, doesn't mean that applies to everyone.

 

[Francisco d'Anconia]

There's some truth about the limitations of just saving money, you can never put away more than you earn in any given time period. Understand that this doesn't mean that you can't stockpile a load but only earn a paycheck from an organization, you can never put away more than what they give you at any one time. That's the difference between people who only earn a living to those who know how to make money. Those who can't tell the difference probably just earn money for a living.

 

[wayword]

Dried beans, lentils, and rice are the cheapest way to eat. It is less work to eat canned beans, and they are only slightly more expensive. Garlic is good for flavor. Peanut butter sandwiches are pretty cheap as well. You can actually subsist for less than a dollar a day. A meal probably costs 30-50 cents, mixing in just one of these meals a day, in place of, say, a $3 tv dinner, would save over $75 a month.

Agreed, dried beans are cheap as dirt but healthy and filling. You can also make them in bulk too - saving you time.

Main thing is to QUIT EATING OUT or DRINKING. That is the biggest waste of money that racks up real fast.

Also, take showers only when you have to - which may or may not necessarily be everyday.

Reduce your AC usage. Just open your windows at night...

And also focus on making MORE money. This is what I need to work on right now, myself.

 

[~attrACTION~]

The whole saving **** is bull****. You have people who preach it as a way to get rich, but it's not. Saving is bull****. Trust me, I know people who save and people who have saved all their life.

I once read this book saying that the only difference between different classes in America is how much they save. What a stupid thing to say.

Somewhat. Saving isn't everything and it won't make you rich, but it is important. If I had saved my extra money, right now I would have enough to buy a nice house. But instead I chose to buy nice cars and expensive things.

You would be surprised, however, how stingy/frugal some wealthy people are.

6. eBay stuff you don't use, want or need anymore. One man's junk is another man's gold.

azanon knows what he's talking about.

 

[dot]

Somewhat. Saving isn't everything and it won't make you rich, but it is important. If I had saved my extra money, right now I would have enough to buy a nice house. But instead I chose to buy nice cars and expensive things.

You would be surprised, however, how stingy/frugal some wealthy people are.

Oh I see what you're saying. I think I was more thinking about the idiot who wrote that book talking about classes depend on how much percentage they save.

Nah I know some wealthy people and they're wasteful. I'm sure there are some that are frugal, but most I've known are more wasteful than frugal.

 

[penkitten]

pay at the pump, less trips into the gas station, less spending money on crap that i cant account for.

 

[Bible_Belt]

oh yea, gas

http://www.fueleconomy.gov/feg/drive.shtml

http://www.edmunds.com/advice/fueleconomy/articles/106842/article.html

Especially if you drive a manual transmission, coast as much as possible, and don't accellerate toward red lights. Try to time the red light so that you don't have to come to a complete stop; slowing only to a roll increases fuel efficiency and reduces wear on brakes.

 

[Docs]

pay at the pump, less trips into the gas station, less spending money on crap that i cant account for.

What? Are you nuts. If you pay at the pump (at least up here in Igloo Land), for some reason, they HOLD about $90 off your credit card, each time.

And to the guy that says saving is crap.
Saving IS crap. I can stockpile $10000, but over time, it's only $10000. (or if you threw it in 3% interest....)

INVESTING however, is the key. If I INVEST $10000, over time I could MULTIPLY that number. Depending on the investment, I could very well make $10000 a 6, eventually a 7 figure number.

 

[Francisco d'Anconia]

What? Are you nuts. If you pay at the pump (at least up here in Igloo Land), for some reason, they HOLD about $90 off your credit card, each time.

True, it's funny that more people don't know about this.

Hosed at the gas pump.

And to the guy that says saving is crap.
Saving IS crap. I can stockpile $10000, but over time, it's only $10000. (or if you threw it in 3% interest....)...

I'm right with 'ya on that. Why save money at only an 3-4% return when you pay 8% (if you're lucky) on the interest on your credit cards? :crazy:

 

[~attrACTION~]

pay 8% (if you're lucky) on the interest on your credit cards? :crazy:

True, it's more like 19%-26% on most cards. But if you're paying interest on your credit cards at all, you're screwed. Well, my first thought when you said that is, "who the heck pays interest on their credit cards anyway?" as if it was an obvious point. But I think it's definitely something to consider...as in you shouldn't be spending money you don't have unless it is for investment purposes. Paying the minimum monthly on your credit card could be like financial suicide. Pay the outstanding balance as much as you can. (just my opinion)

 

[Kerpal]

Everything I was going to suggest for short term has already been said.

Long term: Don't get married and don't have kids. You'll save A LOT of money that way.

http://nomarriage.com/dream.html

 

[Francisco d'Anconia]

True, it's more like 19%-26% on most cards. But if you're paying interest on your credit cards at all, you're screwed. Well, my first thought when you said that is, "who the heck pays interest on their credit cards anyway?" as if it was an obvious point. But I think it's definitely something to consider...as in you shouldn't be spending money you don't have unless it is for investment purposes. Paying the minimum monthly on your credit card could be like financial suicide. Pay the outstanding balance as much as you can. (just my opinion)

I would never use any card whose rate goes beyond 10%. I have a couple that's 12-14% and I haven't used them in years. The highest one I have has a flat rate of 7.9%, the other is one that I transferred my balances to which are at 4.9% for the life of the balance.

I wholeheartedly agree that paying the minimum balance is muck like giving your money away. I end up setting up recurring weekly automatic payments on my cards and typically pay 10x the minimum payment. I usually pay off the debt in 10-16 months.

 

[Francisco d'Anconia]

...Long term: Don't get married and don't have kids. You'll save A LOT of money that way....

You have a point. Typically when you have kids is when the bills really rack up. Bigger car, larger house, more food, allowances and heaven forbid you decide to pay for their college education... :nervous: You'd think that dual income families could handle it; it just seems that they end up spending more money just because they have it.

 

[Abbott]

What? Are you nuts. If you pay at the pump (at least up here in Igloo Land), for some reason, they HOLD about $90 off your credit card, each time.

And to the guy that says saving is crap.
Saving IS crap. I can stockpile $10000, but over time, it's only $10000. (or if you threw it in 3% interest....)

INVESTING however, is the key. If I INVEST $10000, over time I could MULTIPLY that number. Depending on the investment, I could very well make $10000 a 6, eventually a 7 figure number.

I have wondered what the point of a SAVINGS account was. If you don't have that kind of cash lying around, you wouldn't have a savings account. If you DO, then you're better off with a mutual fund or, if you know what you're doing, the stock market.


As for the "power of VISA," the Fantastic Plastic as I like to call it, it's great and is helpful.

But the gun can point two ways. If you aren't careful, the "power of VISA" will own you.

 

[SmoothTalker]

Alright, perhaps some of you guys can explain this to me, because it seems like pure idiocy.

There is a lot of advice (from financial advisors and friends, etc,) on saving, and how absolutely important it is. Don't get me wrong, if you're able, putting a little money away for investment and/or emergencies is great.

But people seem to think that saving is so important that you should do it even when you're in debt.

To me this seems like a horrible suggestion, and here's why:

Unless you're some investment god (in which case you shouldn't have money problems anyway), you're not going to be getting any good returns on your savings. Most people will just throw the money in a savings account and make like 3% a year, ie nothing.

Meanwhile, they are paying interest on whatever loans they have, almost always at much higher percentages. This can range from low single digits for mortgages or car loans, up to the crazy 15-20% or more for credit cards.

So where is the logic here? Why would you take money that you could be using to pay down these crazy loans, and instead invest it in something that pays pennies (savings).

Instead, put ALL of your extra money toward your debts rather than savings, unless the debt is at 0% interest, in which case it obviously makes sense to invest the money. This WILL save you money.

And I don't buy the argument that you have to save even in such circumstances for emergencies. If you encounter an emergency, use loans/credit cards to cover them. This is better than saving the money, because until that emergency (or even better, if it doesn't happen), you're saving tons of money on interest.

Am I missing something, or is the conventional advice on this matter dumb?

 

[Bible_Belt]

Paying off debt is an investment itself. I agree that hardly any other investment matches the typically high rate of most consumer debt. Americans have a negative savings rate; most people are idiots with money. The first step in a financial plan is usually paying off credit cards. I concede that some people have very low credit card rates, but it is usually because they are already in an above-average financial position.

Good debt is the kind that brings in tax deductions, appreciation, and income. Interest on a home mortgage is tax deductible, so a 6% mortgage really costs about 4% for most Americans, and people tend to do well on appreciation of real estate. Investment real estate and also equipment purchases for a business bring in income to offset the debt interest.

 

[Kev07]

Don't know why anyone hasnt' mentioned this yet but

If you need to buy soap/toilet papers/essential whatever wait until they are on sale, or buy one get one free and bulk up


rent rooms of your house

 

[Francisco d'Anconia]

..Am I missing something, or is the conventional advice on this matter dumb?

You're talking about people who are still using the logic from the Industrial Age. At that time in history, survival was made on saving, cutting back, reusing. "Meatless Tuesdays," adding water to milk, saving tin foil for the war, you name it; the depression put the fear of "need" into people and got them into the mindset of saving and hording like squirrels.

The problem is that there are many more effective means to "make money" as opposed to just saving it and people have not taken the effort to learn. Your example makes perfect sense however people seldom take the time to learn new concepts in order to take the easy road of sticking to the what has been the norm for generations.

 

[mpimpin]

Those items can be stolen from the workplace.

:crackup: so true...