Daily Dupaco

Wednesday, August 03, 2016

Make new frugal habits a breeze

Looking for ways you can start living more frugally?

The good news is that cutting expenses doesn’t have to mean sacrificing all the good stuff.

“You don’t have to cut everything fun out of your life,” says Traci Nichols, lending consultant and member service representative at Dupaco’s First Avenue branch in Cedar Rapids, Iowa. “It just means you do it in moderation.”

These simple, painless cost-saving ideas can have long-lasting financial rewards:

  • Pay yourself first. Intentionally save for your needs and your dreams. You can live frugally and take those once-in-a-lifetime trips—you’re just more intentional about saving for the trips in advance so that you don’t rack up high credit card balances on your adventures.

    Use Dupaco’s You Name It Savings accounts to automatically and systematically save for the things that are important to you—an emergency fund, vacation fund, … you name it! Nichols’ family uses four savings accounts and two checking accounts to help manage their budget and allocate their funds.

    “I make myself live paycheck to paycheck, because I know I’m saving and I have it there as a backup,” Nichols says. “If I run out of money in my spending account, I’m done until we get paid again.”

  • Brew your own coffee. If you require a cup of joe to start each day, scale back on those regular trips to the coffee shop and brew more of your own.

    The savings are real—and add up over time. If you buy a 16-ounce cup of coffee at Starbucks every day, you’ll spend at least $766.50 a year—or $22,995 over 30 years. Brew your own, and you could spend as little as $29.20 a year—or $876 over 30 years.

    Calculate your potential savings with USA Today’s coffee cost calculator

  • Avoid unnecessary fees. How many unnecessary fees are you paying? Many credit cards come with hidden fees, so review your credit card terms and statements to make sure yours is not among them.

    With Dupaco’s low-interest VISA credit card, there are no annual fees and no fees for balance transfers to your Dupaco VISA. 

  • What about your financial institution? While many financials assess fees to use their checking accounts, Dupaco offers free checking and fee-free access to your money. 

  • Review your insurance. When’s the last time you reviewed your insurance policy or shopped around for a better rate? Getting a free insurance quote takes little time—but can offer great rewards.

    When Nichols’ family moved to Cedar Rapids two years ago, she requested a quote for homeowner’s insurance through her member-owned Dupaco Insurance Services. “I went from paying over $1,000 a year to $300 a year,” Nichols says. “My jaw dropped. How long was I paying way more than I needed to?”

  • Green your electronics. Some home gaming systems can add up to $13 to your monthly electricity bill, according to Alliant Energy. That’s $156 a year.

    Game consoles use nearly as much power when left in idle mode as when actively being played. So if you have an Xbox or a PlayStation, use the power-saver mode, and turn off the console when it’s not in use. 

  • Rent more movies. If you’re a cinema enthusiast, change the way you watch most movies. Cut back on the number of trips to the theater and instead rent your movies. With Redbox, a family of four can watch a movie for $1.50 plus tax, versus $16 or more to take in a matinee.

    Or, check out a movie for free at your local library. Just don’t watch the movie on your gaming system. Watching a Blu-Ray movie on the PlayStation 3 uses five times more power than watching it on a standard Blu-Ray player, according to Alliant Energy.

  • Put your savings to work for you. The hardest part about reducing your spending is breaking old habits, Nichols says. “It’s hard to get outside your norm and change your routine in any aspect of your life,” she says.

    As you adopt more frugal habits, the true test is what you do with those savings. Ideally, you will redirect those savings to your biggest financial gaps—whether that’s establishing an emergency fund, Individual Retirement Account or maybe saving for a down payment on a house. 

“I think people think about reducing costs, but does it get executed to its fullest extent? I’m not sure we actually do,” Nichols says. “Many will save it and then spend the money on something else without realizing they’ve done that. You have to force yourself to save and step outside your box.”

By Emily Kittle

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