When I was a kid, I used to sneak in double cheeseburgers off the dollar menu for snacks every time I hit up the movie theater. My friends would laugh at me, but my wallet wouldn’t when it saw them drop $20 for tub of popcorn and $30 for a bag of skittles.
I also used to call my parents collect from payphones whenever I needed a ride home, but instead of paying the ridiculous fees of using such money gobblers, I’d get my request in for free by simply stating it in the “name” part and then quickly hanging up. (You youngin’s will have no idea what I’m talking about (“What’s a pay phone??”) but you oldies will…)
So instead of saying “J. Money” when asked to speak my name, I’d blurt out “mom-pick-me-up” instead as fast as I could and then hang up before the charges went through (since we never talked). 10 minutes later my ride would be there!
All this came back to me when I ran across an old family friend this weekend who puts my frugal skills to shame. He told me he just came across a new trick for saving money, and as soon as I heard it I immediately inducted it into the S.H.H.F. (Saving Hacks Hall of Fame)
Here’s what he said:
“You know how every year we need to get those state inspections for our cars? Well, I recently had to take mine over the other day to get it done, and it dawned on me that if I were to leave it there over night – on the last day of the month before the sticker expires – they wouldn’t be able to get to it until the next day when it was a fresh new month. Thus giving me an entire free month’s worth of inspection period equal to 8% in savings! What do you think about that?”
I told him I thought that was incredibly clever! Who the hell thinks about saving money on mandatory state inspection stickers? Haha… But my friend here is right. If you bring it in, say on the last day of this month – February 29th and leave it over night (that way you’re only “illegal” from 12am that night when it expires until the morning it gets the sticker) it’ll be a brand new month and the sticker that will go on will say March 2017 instead of February, 2017. And then if you do the same thing the following year and all future years, you’ll continue nabbing this 8% in savings! Boom!
If you’re still reading this blog, John, we salute you :)
10 More Savings Tips to Ponder…
As if the Savings Gods weren’t already being nice to me, I stumbled across 10 more kick-ass tips that same day, this time via an article by The Simple Dollar: 10 Ways to Trick Yourself Into Saving Money.
Some of these you may have heard before, but I’ll list them out anyways and see how many we’ve done, okay? I’ll go first, and then it’s your turn :)
- Institute a waiting period before you make a purchase. For all bigger purchases I do this ($50-$100+) but for littler ones I just do my best to make decisions on the fly. Which only works out okay because I now have my finances in order (so if you’re new to the game, def. think about doing this for *most* of your non-necessary purchases)
- Boost your tax refund through payroll deductions — I used to always do this! I couldn’t care less about “loaning the gov’t money” all year as the chunk I’d get back always felt incredible and was an easy way to save up cash on the side without noticing it much. Now back then I used to blow it all on nonsense, but the point is it DOES help you to save if that’s a problem you’re having.
- Transfer coupons and discounts into a savings account — LOVE!!!! And pretty much exactly what I did all last year during our Challenge Everything Mission. Any new money I came across – whether from selling something or saving on monthly expenses – all got stashed away in a totally separate saving account which only grew since I never touched it (to the tune of $5,000+!). By far one of my FAVORITE ways to boost not only savings, but *momentum*.
- Remove credit card numbers from your favorite online shopping sites – Haha… I don’t shop enough for this to be a problem, but I agree that making it annoying as hell for yourself will def. prevent some spending!
- Trick yourself with a zero-sum budget — “At the beginning of each month, you make a list of that month’s fixed and estimated expenses, tally them up, then transfer the amount of money you need into checking. All extra dollars you earn that month and the month before sit safely in your savings account.” — Beautiful! And is exactly what we do too. Although I like to think of it as the “pay all your bills a month ahead” approach, which gives you a crazy amount of padding during the times you don’t get extra money that month and actually get less. Something not all too uncommon when you’re self-employed.
- Convince yourself that you’re broke. Yes! This one’s great because it helps you set boundaries with your extra cash before it has a chance to go out the window. In a nutshell, you keep your checking account close to $0.00 or whatever buffer you need in there to feel safe, and then you divert all other money elsewhere so you don’t think of it as “free money” to play with.
- Maximize work-sponsored retirement accounts, and live on the rest — Yup, do that one too… I’ve maxed out both my SEP IRA (and before self-employment, my 401(k)), as well as my Roth, going on 5+ years in a row now… It’s not always easy – especially this year for us – but if you only did that (or even one of them) and nothing else you’d amass a million dollars+ over time pretty easily. And the beautiful part is that you’re not tempted to pull from any of it since you get dinged up the arse! So it’s another excellent way to hide cash from yourself too.
- Transfer raises straight into savings. Another great one! Easy to do and keeps lifestyle inflation at bay. You’re already used to your paycheck and not counting on it for anything (at least I hope) so why not funnel it away the second it hits your account? I’m a firm believer that you should always know what you’d do with extra money way before it comes in. That way you’re not tempted to blow it on something outside of your priorities and then later regret it (it’s def. cool to blow a little and have fun, of course, but hopefully not the entire thing)
- Ask yourself one important question before you make a purchase — The article says a good question to ask is, “Did I need this yesterday?” which I think is pretty good (hadn’t heard of that one before), but the two I like to ask are “Would I rather have this, or cash?” and if I’m shopping for clothes, “Would I put this on right now and wear it out?” It’s amazing how easily you can change your mind with a simple question :)
- Trick yourself with money-saving apps — We all know I love this one ;) Been rocking both Digit and Acorns for about a year now, and have $3,000+ extra to my name because of it. No shame in harnessing technology! Especially the automatic type!
So looks like I’ve done almost all of these at one point or another. Pretty cool!
How about you? Any of these new/interesting to you? Gonna try any of them out?
If I can figure out a way to clone myself, maybe I’ll put together a real Savings Hacks Hall of Fame for us one day… Instead of stars on the ground though it’ll have to be piggy banks, and instead of gold statues we’ll of course hand out plastic ones at the yearly inductions.
But what a fun event to attend! Even if it’s B.Y.O.B. ;)
[Photo by rawdonfox / Tweaked by J$]
Featured savings tip
You already know that banks pay $$$ for the privilege of holding your money…it’s called interest. But maybe you didn’t know this: that so-called interest can be as little as .01%. If your cash savings aren’t sitting in a high interest savings account that earns you at least 1%, you’re basically saying “no” to free $$$!
Now, obviously the 1% interest you get with a high interest savings account like the one at Discover bank won’t make you rich, but that extra 1% compounded over 30 years can grow into a *big* pile of cash. And if you wanna hit lofty $$$ goals, you should be looking for every edge possible.
Here’s another way to look at it: if you leave $50,000 in a regular savings account, that’s almost $500 you’re just throwing away, each and every year you don't setup a high yield savings account! Will you do 5-10 minutes of work right now to earn an extra $500/year for years to come?
If you said “heck yes”, then you can setup your high interest savings account here to start earning 1% on your cash savings.