In my travels on this big blue marble we call Earth, I have come to find that frugal folks are subjected to a lot of public dissension. Many people believe penny pinchers are boring tightwads, almost Scrooge-like and reclusive. However, that notion is the furthest thing from the truth -at least when it comes to yours truly. I not only know how to have a good time, I can do it without overspending in the process. I have unlocked four money saving secrets to living rich by spending smarter.
I Nixed My Frivolities
I never realized how many frivolities existed in my budget until I went looking for them. For me, it was a morning coffee, a daily lunching out habit, a every few days happy hour indulgence and a snacking fetish fed by the office vending machine. When I cut out frivolities that seemed a daily drop in the bucket, I realized that I was dropping $6,500 a year.
I Re-evaluated My "Needs"
After trimming my frivolous fat, I began looking at some of my budgetary line items that I counted as "needs", but that weren't exactly needed. I had a premium cable bill full of channels I wasn't watching, a monthly overpriced gym membership I wasn't using (I was working out at home), too-high entertainment expenses and clothing allowances that could definitely be scaled back.
After trimming some of the additional fat from my budget, I was saving over $1,500 a year.
I Prioritized my Pre-Tax Income
I got smart about how I was handling my pre-tax income. I prioritized what was important me, set savings goals for those things and then made sure I wasn't overpaying Uncle Sam. I didn't see the point of a rebate, when I could make my money work for me 365-day a year. I put my head together with my accountant and made some changes to my pre-tax dollars that let me keep $2,400 more each year in my bank, instead of on loan to the good old USA.
I Monetized My Life
Everyone has to spend money and I am no exception. I have to put food in my belly and feed my family. I have to put clothes on my back and take care of my kids. However, I make sure that I stay on top of money earning opportunities, maximize cash back rewards programs and earned $5,000 in cash back savings in 2011 -enough to max out my Roth IRA.
Yes, I admit, I am frugal, but it is because of that frugality that I live rich and live better, without debt. Making small changes in my attitude about money led to bigger changes and even more savings. I consider myself to always be a work in progress, but it was these small action items that led to even more action items that took me well over $15,000 a year in additional savings. I know what I can do with $15,000 a year; do you?
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