Mary Hunt, founding editor of the Web site Cheapskate Monthly
defines the oft-maligned cheapskate as dignified.
"A cheapskate has a balanced, honest and dignified approach
to money management. It's someone who doesn't spend more than
they earn or let money and material possessions rule their
thoughts and desires.
"A cheapskate does not buy on impulse,"
says Ms. Hunt.
Penny-pinchers use products and services
resourcefully. This can range from timing a shower to having
leftovers for lunch to washing and reusing disposable plastic
Here are 25 ways to release the cheapskate within you or to
stop spending and start filling that cookie jar.
The more flexible your travel plans, the more you'll save.
Use the Internet to search for the cheapest tickets and buy
them online. Travel on low-fare airlines and through
substitute airports. Cut costs even more by traveling
off-peak days such as Saturday and Tuesday through Thursday.
Buy your tickets in advance.
Shop around for the best basic rates. Inquire about
additional charges such as gas, drop-off fees and
extra-driver rates. Find special offers. Check with your
insurance carrier and credit card company to avoid
duplicating coverage you might already have.
If you can, buy the car with cash or make a large down
payment. Get the lowest financing possible. To find the best
rates offered in your area, check Bankrate.com's auto loan search engine.
Do your homework before negotiating on a vehicle. Research
the vehicle's fuel economy, maintenance needs, insurance and
repair costs by checking new-car guides at Web sites such as
Autopedia or AutoSite.
Comparison-shop and be sure to let the salesperson know you
are doing that. Some fees can be negotiated, such as the
"dealer prep" charge. Try to get the dealer to drop the fee.
It's just more profit for them.
Before you buy a used car, always compare the seller's
asking price with the average retail price in a car price
guide such as Kelly Blue Book. Have a mechanic check
the car, especially if the car is sold "as is." Buy from
people you know and trust. They are more likely to sell at a
lower price and point out any problems with the vehicle.
Don't lease just because the payments are low. After all, in
the end, you won't own the car. If you do decide to lease,
know the fair market value of the car and then haggle price
and terms with the dealer just as you would if you were
buying. Make sure you're clear on all the fees and terms,
especially excess mileage penalties and "wear and tear" fees.
Use this auto lease payment calculator to
determine how much this lease really is costing you.
Keep your engine well-maintained and your tires at the
proper pressure to save on fuel costs. Look for a gas station
that supplies free air. Combine errands into a single trip
and use the family's most fuel-efficient car when doing
extensive driving. Compare prices at different gas stations;
pump the gas yourself; and use the lowest octane possible for
your car. Check out this calculator to find out if you can save by
driving to a cheaper gas station.
Shop around as rates vary widely. Call at least four
agencies. You can lower your rates by raising your
deductibles on collision and comprehensive coverage to at
least $500. If you have an old clunker, drop the coverage
Raise your deductibles. Always make sure that you purchase
enough coverage to replace the house and its contents. Make
sure your new policy is in effect before dropping an old one.
For insurance protection only, buy a term insurance policy.
Don't cancel your whole life, universal life or other cash
value policy before 15 years, or your life insurance costs
could be doubled.
Select a free checking account or one that has no
minimum-balance requirement. If you cannot find a bank with
free checking in your area, consider an online bank. Check
with your bank to see if it will lower checking fees if you
use direct deposit.
Do not pay ATM fees. It's throwing away money. Always use
your bank's ATM or get cash back from point-of-purchase sales
at places such as at the grocery store. This strategy is
particularly effective when traveling, and eliminates the
late-night drive in the rental car through unfamiliar
territory searching for a network ATM.
Rather than stashing idle cash in low-yielding checking or
savings accounts, put your money in short-term certificates
of deposit or money market accounts. Internet banks offer
some of the best yields. Want to know which financial
institution is paying the highest yield? Check out Bankrate's savings and CD search engine.
To eliminate all interest charges and fees, pay off your
account each month. If you do carry a balance, switch to a
card with a low interest rate. Bankrate's credit card search engine will
help you find the best deal on a card. Limit yourself to two
credit cards. Read your monthly billing statements carefully
making sure you pay on time and don't exceed your credit
limit. Those penalty fees are the worst.
Your first house need not be the "dream home." Lower your
expectations -- start with a townhouse or condo. Just start
building equity. If you are a first-time home buyer, find out
if you qualify for special mortgage and down payment
programs in your neighborhood. Get the shortest-term
mortgage you can afford. The monthly payments will be higher,
but you'll save thousands of dollars in interest charges. Go
with a low-rate mortgage and the fewest points. To find the
best rates in your area, check Bankrate's mortgage rate search
Consider refinancing your mortgage if you can get a rate at
least 1 percent lower than your existing mortgage rate. But
first, look at your current payment, figure the costs of
refinancing and see how long it would take you to recoup the
charges. Use this refinancing calculator to decide whether
refinancing will save you money.
Home equity loans:
Generally, the interest paid on home equity loans is tax
deductible. Using home equity loans or lines of credit can be
a cheap way for homeowners to consolidate expensive,
high-interest debts like credit cards and reap the tax
savings. Use caution -- if you cannot make the payments, you
could lose your house.
Consult Consumer Reports for information about specific
brands and how to evaluate them, including energy use. Once
you find a brand, call a few stores and ask for the prices of
specific models. After each store offers you a quote, find
out if it is the lowest price they can offer. Haggle!
Make sure your appliances are energy efficient, especially
air conditioners and furnaces. Enroll in a load-management
and off-hour rate programs offered by your electric company.
Get a home energy audit to find ways to save on heating and
air conditioning. Some utility companies do the audit for
free or for an affordable charge. Try the new generation of
compact fluorescent light bulbs. They use 70 percent less
electricity and last up to 10 times longer than incandescent
light bulbs. They screw into the same sockets and produce the
same quality of light as incandescents.
Local telephone service:
Check with your phone company to see if it offers a flat
rate or measured service plan. Get the cheapest plan
possible. Get rid of optional services such as three-way and
call waiting. Check the phone bill to see if you have any
optional services that you really don't need or use.
Long distance phone costs:
Long-distance calls are cheaper if made in the evening or on
weekends. If you make a lot of calls, consider a
long-distance calling plan. Check rates with three or four
companies to see which has the least expensive plan for the
type of calls you make. Every few months shop again. Rates
are changing regularly and if you often make calls outside
your local area, you can save a lot. Save on fees by having
your long-distance carrier bill you directly rather than
through your local telephone company. Or, buy a long-distance
phone card with rates of 3.5 to 5 cents per minute.
Always shop with a list. Compare price-per-ounce or other
unit prices on shelf labels. Stock up on items you regularly
use during sales. Use coupons, but only for products you
Ask for a generic equivalent; it's much cheaper. Pharmacies'
charges vary, so comparison shop regularly. Consider using a
mail order pharmacy, which often sells for a lower price.
Start holiday shopping early and spread it out over a few
months instead of a few days. If your state offers "tax-free"
shopping days during the summer -- get a jump on birthday and
holiday purchases then. ALWAYS send in for the rebate on a
purchase, whether it's $2 or $50. It all adds up.
On the job:
Give yourself a raise by contributing to your company's
401(k) program. Not only will you be wisely sacking money
away for retirement, but you'll pay less tax each pay period.
Retirement contributions are not taxed until they are
withdrawn. Plus, most companies contribute to the 401(k)
accounts of participating employees. That's a raise.
Go to matinees of first-run movies. You'll still get the
big-screen experience but at a significant savings. Try out a
dollar theater, a local film festival or even a drive-in. To
really save, rent movies. Better yet, check out your local
public library for free movies to borrow or work as a
volunteer at a local fair or festival -- you'll get in free.
Article courtesy of Bankrate.com.