Lessons from Mom: 33 Easy Cost-Cutting Tips

pLet?s face it folks ? the average American is a compulsive spender, and here are the statistics to prove it. The American Consumer Satisfaction Index (ACSI) in May this year predicted that consumer spending was likely to increase, even as the growth of wages and salaries continued to slow down and the national savings rate went into the red. While increased consumer spending may be good for the national economy, it?s definitely not so for the bank balance of the average family, more so when you spend $12 for every $10 that you earn. It?s high time the purse strings were tightened, and we all started focusing on saving.

It turns out that the simplest ways to cut costs are the most practical ones ? the lessons you learned from Mom, but somehow forgot all about as you grew up. Well, it?s not too late to jog your memory, dust those mental cobwebs, and get your financial act together with these easy cost-cutting tips:

1. A penny saved is a penny earned: Why did your mom place so much importance on your piggybank as you were growing up? Because money saved does grow, due to this magic fertilizer called compound interest. Mom?s recommendation - when your paycheck comes in, set up an automatic withdrawal from your checking account so that 10 percent is saved immediately. While the pinch may be felt for a few months, pretty soon it will be replaced by the bulge of the fattening savings account.

2. It’s wise to save for a rainy day: You?re in a good place right now, with a more-than-adequate income that keeps rising as you advance in your career, so what do you do? Raise your standard of living? No, not if you want to follow mom?s sage advice. A three percent annual increase in inflation will double your living costs in only 24 years. So let those extra dollars accumulate, beat inflation, and make sure you have a nice nest egg to fall back on when the cost of living surges upwards.

3. The first step is always the hardest: Yes, before you get down to some really heavy cost-saving measures, there?s the dreaded budget to set up. Mom would tell you put all your basic necessities first, your mortgage, food, clothing and utility expenses, transportation, children?s education. The non-essentials can be worked in after that based on the income you earn. List your recurring costs and one-off expenses, and most important, don?t forget to add that amount for pesky, unforeseen contingencies.

4. Don’t count your chickens before they hatch: Ok, here?s a vital aspect that needs to be taken seriously when preparing a budget, and mom will find it hard to forgive you if you forgot it. Never, ever take potential windfalls into consideration when calculating your monthly or annual income. Among the things you consciously ignore are that promised pay raise sometime in the next quarter, that inheritance from the filthily rich maiden aunt on her deathbed, tax refunds from the IRS, the proceeds from property you hope to sell for a fortune, gains due to investments in stocks or mutual funds, and well, you get my drift.

5. A rolling stone gathers no moss: This one?s for those of you who are bitten by the wanderlust bug. Changing jobs too often? Can?t seem to find that perfect home? Not decided where to plant roots and settle down? If so, mom would tell you that you need to get your act together and set up home somewhere permanent. Too many changes in lifestyle add to the dollars spent unnecessarily.

6. There?s no place like home (and no food like home-cooked): Eating out or ordering in eats up a sizeable part of your income, without you being aware of it. The odd doughnut at the office, the takeout from the new Chinese deli that opened across the street, the chocolate bar and pretzel packet from the lobby vending machine ? they may not seem like large expenses, but they sure do add up when you tally them at the end of a month. Mom would be proud of you if you brushed up those cooking skills she taught you and put them to use when trying to cut costs. Home-cooked food is the cheapest and healthiest way to satisfy your hunger pangs.

7. Charity begins at home: Instead of going out to catch the new James Bond flick, stay in, and watch it on DVD, with snacks from your own larder, popcorn that?s fresh from your microwave, and lemonade chilled from the refrigerator. Mom would say you?ve achieved multiple savings with this move, from the movie tickets to the ridiculous cost of snacks at the multiplex theatres.

8. Penny wise and pound foolish: You?ve been a good boy and stayed true to your budget. No cups of coffee at Starbucks, no Diet Coke for lunch, no film glossy picked up at random at the corner newsstand, no pizza for dinner. Then bang, the bubble bursts, and mom?s not pleased with you. Why? Because you just blew the pennies you saved, and a lot more, on a vacation to Hawaii, just because an airline offered to fly you there at a discount. The amount you save is peanuts compared to the added expense of a vacation. For two steps forward, you?ve moved ten steps back.

9. It’s hard to teach an old dog new tricks: If you?re a family man, mom would look more kindly on you if you passed on her valuable pointers to your own brood right from the time they?re in diapers. It doesn?t make sense to ask your pre-teens out of the blue to curb his spending habits when they?re just discovering the wonderful things money can buy. What they don?t realize at that age is the not-so-wonderful consequences that arise when deep in debt. Children who are taught the value of money from a very early age will be an asset when you?re trying to stick to a budget, cut back on your expenditure, and get out of debt.

10. Don?t put off till tomorrow what you can do today: Mom would definitely not advocate procrastination when it came to paying bills and credit card balances. Every late payment translates into extra costs in terms of interest and penalties incurred.

11. An idle mind (and body) is the devil?s workshop: Remember when mom roped you in to help with her spring cleaning around the house? Well, she was just preparing you to mow your lawn, trim your hedges, vacuum your floors, wash your car, polish your windows ? in short, to take care of your own work. Paying someone to take over your chores may give you more time to relax, but it will also set you back financially.

12. Talk is NOT cheap: Mom may not have had the plethora of choices that telecommunications providers offer today, but she sure would know that talk is certainly not cheap. The glut of landlines, mobile phones, wireless devices and VoIP devices has only served to send the average American?s phone bill sky-rocketing. Review all your options, eliminate redundant lines, try and take advantage of closed user groups that allow free calling between certain numbers, or be wise and use prepaid calling options.

13. A bird in the hand is worth two in the bush: While the benefits of credit cards cannot be denied, mom would be the first to remind you that you?re spending money that?s not yours in the first place each time your card is swiped. This means that the money is being loaned to you by the bank, which in turn means that you owe the institution some interest for providing you this service. When you use your credit card, ask yourself if you have the money in your account or if you are hoping it will get there before the month?s bill is due. If you?re not sure where the money?s coming from, use cash or a debit card. And if you don?t have either, don?t buy.

14. Neither a borrower nor a lender be: Credit cards were just making an appearance in mom?s day, but to see the way plastic has replaced cold cash today, and the plethora of credit card rewards programs out there, one would think they?ve been around forever. While it?s impossible to dream of a world free from credit cards, mom would say you can cut down the costs they throw up by paying your bill every month, by not using your credit card to withdraw money from the ATM, by staying within your credit limit, and by sticking to just ONE card, or if you absolutely have to, two. Set up a differentiating mark for expenses that need a credit card, and for those that don?t. Smaller amounts being paid with cards don?t add up as cost-cutting measures. Use your card only for purchases above certain amounts.

15. Planning makes perfect: Plan your weekly purchases, draw up lists, and most important, stick to them. Remember when you accompanied mom to the supermarket as a kid? No extra goodies in the basket, was her rule then, and it?s the same now, if you mean to cut down on your expenses. It?s simple ? if it?s not on the list, don?t buy it, no matter how tempting it looks, no matter if it?s on sale, or no matter if it?s the last box on the shelf.

16. A fool and his money are soon parted: You may be all grown-up, but Mom would still like to restrict your television viewing and Internet surfing. Why? To prevent you from being enticed by those must-have gadgets and gizmos being advertised as the next best thing since sliced bread. Online and catalogue shopping sprees should be controlled when following a budget.

17. Share and share alike: Mom may have been really proud of you when you bought your first car, but now that she realizes how much gas it guzzles, she may rethink her approval. Save on gasoline and travel expenses, use car pools or take the public transport to and from work. Walk short distances, use bicycles for longer ones, you?ll not only save money, but also time spent in searching for parking space.

18. Many hands make light work: A budget is not just for the head of the family — all members must be roped in if it is to work effectively. If you remember the importance of teamwork taught by mom, you?ll pass it on effectively to your children.

19. Two is better than one: Doing things as a couple rather than as individuals helps save costs. For example, joint medical insurance is cheaper than insuring each one of you separately. If you asked mom for pointers, she would also recommend buying home and auto insurance from the same provider. You can save up to 15 percent, and even if you meet with an accident, they?re less likely to drop you since they would lose other business as well.

20. Water, water everywhere, but not one drop being drunk: Why do you think mom asked you to drink a lot of water when you were a child? Cause she knew colas would replace the natural thirst quencher as you grew up. She?d be the first to tell you that you can save a bundle on skipping the aerated drinks and sticking to plain old water or a home-made fruit juice to wash down your food.

21. Laugh and the whole world laughs with you, cry and you cry alone: If your mom warned you about fair-weather friends, you?ll know what I?m talking about. Don?t throw money around on parties and good times, especially when friends and acquaintances weasel their way out of chipping in. When you?re in a financial tight spot, these are the rats who are the first to desert the sinking ship.

22. What’s in a name? A rose by any other name would still smell as sweet: Carbolic soap was enough in mom?s day ? it got out the dirt if you scrubbed hard enough and kept the microbes at bay. No fancy brand names to contemplate and no fancy prices to pay either. Stay away from branded goods if you?re trying to cut costs; alternative generic products are just as good, you only have to take the trouble to look at the ingredients if it?s a shampoo or cosmetic, or the material if it?s a handbag or dress. The tag does not matter, only the price tag does.

23. A walk a day keeps the doctor (and medical expenses) away: Children need plenty of exercise, as mom would say, and so do adults. No, she wouldn?t recommend that you sign up for those workouts you never do at swanky gyms. Regular walks and jogs don?t cost you much, just a pair of sneakers, tracksuit, and a lot of breath. They also keep you from the doctor?s doors, saving you thousands in medical expenses.

24. Waste not, want not: Turning out a light as you leave a room may not seem like an expansive gesture, but it sure cuts down on your annual electricity bill. There are tons of other gadgets that, if used effectively, can bring down your utility expenses. Mom would recommend that you turn down the thermostat by two degrees, repair those leaky faucets on the double, use light bulbs that consume less power, clean heating and air vents regularly, and make sure that doors and windows are airtight.

25. Don?t try to keep up with the Joneses: Your neighbor just treated himself to a new plasma TV set, and you feel you?ve just got to have one too? Listen to the voice of your mom telling you to stop competing with the rest of the world. Instant gratification will lead to larger money problems in the future.

26. A chain is as strong as its weakest link: You?ve got all your family members hooked to the budget, well, all except one. Your teenager refuses to toe the line and insists she be allowed to spend as her friends do. Indulgent mom that you are, would you let her get away with this? Not if you followed what your mom taught you. One aberration in an otherwise strong chain is enough to shatter it to pieces. Make your family aware of the need for cooperation in planning for your future. Dangle a carrot on a stick, like the promise of a good college education, if she skimps today.

27. Don’t raid the cookie jar: Ever been rapped on the knuckles for dipping into the cookie jar? Well, now the jar is serving another purpose ? to hold all your loose change and the odd dollar or two. Each day, turn out your pockets and put the coins in the jar. You?ll be surprised at the amount you manage to save ? most families use this money for a special treat. Did you just see mom beam a smile of approval?

28. Big is beautiful: Buy in bulk. The larger cartons are always worth more than the smaller ones. Mom would say that this also saves you the trouble and expense of returning to the store when you run out.

29. Read the fine print before you sign the dotted line: Paying that bill due to the phone company or the bank? Read it carefully to see if they?re charging for services you don?t really need or use. This is where mom?s advice to read before you sign comes in handy.

30. Time is money: Christmas and birthdays demand presents, but when you?re trying to cut costs, it just doesn?t help to spend on others. But how do you show your loved ones that you do remember their special day and wish to commemorate it with something worthwhile? Ask mom, and she would say that spending time with them doing the things they love is just as good as, if not better than a tangible gift.

31. Watch and weigh your purchases: Before you buy anything, even the most insignificant item, think not once nor twice, but till you are convinced that the purchase is absolutely necessary. As mom would say, ?want? is not the same as ?need?. If it?s just want, then take it out of your cart, if it?s need, it makes its way to your home.

32. Small drops of water make up the mighty ocean: No amount is too small, not when you?re trying to cut costs. A saving of $10 a day will go a long way in reducing your debts. Chipping away at your debts and expenses little by little is a slow but steady way to take control over your financial life, and mom would surely approve.

33. If at first you don?t succeed, try, try again: There may be times when you are not able to stick to the budget plans you so carefully drew up. Fear not, mom?s not going to be disappointed with you if you do stray off the straight and narrow path, not as long as you try to return and follow it faithfully.

Cutting back on expenses is like trying to lose weight, it?s hard to shake off that first pound, but once you get going, it gets easier with every step you take. One eating binge should not set you back, nor should the fact that the rest of the world seems to feasting while you are starving. Remember, use the ultimate goal as an incentive to keep you going, a figure to die for, or a debt-free existence with the promise of a secure future.

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8 Responses to “Lessons from Mom: 33 Easy Cost-Cutting Tips”

  1. This is just an excellent and complete list, I love it. It’s true about time being better than expensive gifts (hmmmm, but my spending time with people usually involves expensive airfare…. ;)).

  2. Great post! Each and every point rings true.

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    A good rule of thumb is to never spend on a card what you can afford to pay in cash. This little habit will keep you spending wisely for years to come and insure that you’ll always have the credit card to fall back on in an emergency.
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    I hope you’ll find it useful have a great day!

  4. I agree with all the commenters. It was really a nice post. There is a great difference between spending money and wasting money. This post just taught me that difference.

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  6. Check out this movie about the debt industry. it will really open your eyes:


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  8. check out “In Debt We Trust” a new movie about the debt industry that will blow your mine. this is fast becoming a national crisis.


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