Throughout the year, there are steps you can take
to pocket extra cash, whether it's booking airline tickets a month in
advance or setting aside tax-free wages to pay for health care. In many
cases, these actions can result in substantial savings over time.
The
problem is these moves typically require some degree of planning. And
when you're juggling work and the daily tasks of life, such
opportunities have a way of sitting on the back burner until it's too
late.
To avoid another year of missed chances, here is a
guide to simple money-saving moves you can make each month in the year
ahead. Scan it now to see whether there are any particular dates or
actions you want to flag, and keep the list handy.
You may discover you've been leaving free money on the table for years.
JANUARY
DEBT: It's a perennial New Year's
resolution, but there's extra incentive to pay down your debt right
now. Cash still isn't earning much interest sitting in deposit accounts,
with the average rate for a one-year CD clocking in at just 0.35%,
according to Bankrate.com. So if you're sitting on extra savings, consider using it to knock off any accumulating credit card debt.
TAXES:
To make the most of your taxes, designate a file folder or kitchen
drawer where you can keep receipts and other necessary paper. A common
roadblock when filing returns is a lack of documents to claim
deductions.
COLLEGE: Families with
college-bound kids will want to get their taxes squared away early. The
income and asset figures from the returns will be needed to fill out the
Free Application for Federal Student Aid (FAFSA), which should be
completed as soon as possible after Jan. 1. An early application
improves the chances of receiving aid from multiple sources. To fill out
the form, go to fafsa.ed.gov.
FEBRUARY
SPENDING: Flowers can become a big part of your Valentine's Day
spending, especially if you procrastinate. If you plan on sending a
bouquet, start browsing websites early to avoid inflated delivery
charges on last-minute orders.
CREDIT CARDS:
Sweeping credit card reforms have banned a number of misleading billing
practices. But the new rules don't set guidelines on rewards programs,
which cardholders often fail to use to their full potential. Take a few
minutes to understand the caps, expiration dates and redemption process
of your program; a few tweaks to your spending habits could boost the
cash back rewards or points that you earn.
ENTERTAINMENT:
If you realize you haven't seen any of the Oscar nominated films even
though you've been paying for premium TV channels, it might be time to
trim your cable package. The trial offers you were given when first
signing up may also have expired.
ENTERTAINMENT:
While you're at it, commit to a cap on how much you'll spend on online
entertainment each month. It's easy to lose sight of how much you're
spending when all you have to do is click "buy."
MARCH
TRAVEL:
If you're planning a spring break, remember that the best time to book a
flight is four to six weeks before traveling; prices for any given
flight are generally highest in the few weeks just before and after that
time frame. Airlines also offer the most sales on Tuesdays, Wednesdays
and Thursdays.
SPENDING: As you store away
your cold-weather gear, make a list of any items that need to be
replaced for next winter. Then hit the clearance sales and avoid impulse
buys by shopping only for items on your list.
APRIL
TAXES:
Don't panic if you haven't filed your taxes yet. You have until October
if you file for an extension, but you'll need to do that, and pay any
taxes that are due.
BANKING: In honor of Earth Day,
check to see if you can save a few bucks by opting for e-statements.
The monthly service fee for a basic checking account at U.S. Bank, for
example, is $6.95 when customers opt for e-statements. If customers opt
for paper statements, however, their monthly fee is $8.95. And while
you're making tweaks to your bank account, consider setting up automatic
bill pay to avoid late fees.
MAY
SPENDING: If you're dining out on Mother's Day, go online to see if there are any deals available at your mom's favorite restaurants. Start with sites such as BiteHunter.com and Restaurant.com; if your mom is a fast food junkie, try EatDrinkDeals.com.
HOME:
Before the weather gets too hot, consider investing in a more efficient
air conditioner to save on energy costs. Keep in mind that getting a
unit that's too powerful for the space you're cooling can be just as
wasteful as getting one that's too weak. The recommended capacities for
various room sizes can be found at energystar.gov .
COLLEGE:
If you're the parent of a high school sophomore or junior, start
planning a tour of college campuses this fall. Think about coordinating
the visits with another trip and try to get in as many nearby campuses
as possible to minimize travel costs.
JUNE
SPENDING:
If you have multiple wedding ceremonies to attend this summer, think
about where you can cut corners. This could be as simple as limiting how
much you spend on new clothes or teaming up with others to buy group
presents.
HOME: It's National Homeownership
Month and interest rates on mortgages should still be near record lows.
If you're still not sure whether you're ready to become a homeowner,
check out the renting versus buying calculator on Ginnie Mae's website.
HOME:
Homeowners should check whether it's worth refinancing. The general
rule of thumb is that the new rate should be at least 1.5 percentage
points below your current rate. Otherwise closing costs may not make the
savings worthwhile.
JULY
INVESTING:
The mid-year checkup on your investment portfolio is even more critical
in times of market volatility. You want to be sure that market gains
and losses haven't knocked your mix of stocks, bonds and cash out of
balance. If you don't have a financial planner, consider rebalancing
with the help of an online portfolio tool.
HEALTHCARE:
If you're inspired by the Olympics set to take place in London, check
whether your employer offers any discounts for health club memberships
or programs.
COLLEGE: This is the time of year
that families apply for private student loans to bridge funding gaps
for college. When evaluating the options, be sure you understand whether
the loan has a variable interest rate and what the options would be if
payments can't be honored. The rates and terms on private student loans
are far less forgiving than on federal student loans.
AUGUST
SPENDING:
Several states offer tax holidays for back-to-school items on a
designated weekend. The timing varies by state, but tax holidays usually
start early in the month. If your state had a tax holiday last year, it
may run again this year. The Federation for Tax Administrators offers a list of this year's dates and qualifying purchases.
TRAVEL:
It's time for a little number crunching. Set aside an hour or two to
review your summer travel and recreation expenses. See how much your
vacation ended up costing, compared with how much you intended to spend.
Make a note of unexpected expenses you could have avoided and file it
away for next summer.
SEPTEMBER
COLLEGE:
The rise in college costs has far outpaced the rate of inflation;
tuition and fees alone are an average of $17,000 a year at public
universities. In honor of National College Savings Month, consider
setting up a 529 college savings plan for your child. These work like
401(k) accounts and let families invest in the market and withdraw money
tax-free to pay for education. Each state offers its own plan; families
can invest in plan from any state they like, but there are often tax
benefits to picking one from home.
SPENDING:
The holiday shopping season is rapidly approaching. Keep spending in
check by starting to pay down debt and mapping out a budget.
OCTOBER
HEALTHCARE:
Open enrollment season arrives in workplaces across the country. Many
companies have been tweaking their benefits to keep pace with rising
health care costs, so make sure you're still signed up for the plan that
best fits your needs. Also consider opening a flexible spending account
for health care costs. These accounts let you set aside tax-free wages
for items such as copays and medications.
HEALTHCARE:
While you're thinking about healthcare, don't forget to evaluate how
much you spend on medications. Over-the-counter drugs are as much as 50%
cheaper at Target and Wal-Mart than at supermarkets, according to Consumer Reports.
The big box retailers also charge $4 for a 30-day supply of many
generic prescriptions, or $10 for a 90-day supply. Other chains, such as
CVS and Rite Aid, offer similar programs.
NOVEMBER
INSURANCE:
As you start to review your expenses for the past year, check whether
you can cut your auto insurance payment. If you have some savings, you
may be able to lower your rate with a higher deductible, or you may not
need as much coverage if your car has aged and depreciated in value
since you first signed up for coverage. A clean driving record since
then may also qualify you for a lower rate.
TAXES:
Start thinking about the year-end moves to lower your tax bill for
2012. For example, consider maxing out contributions to your retirement
accounts if you haven't done that already.
COLLEGE:
It's time to have a money talk with new college graduates. The
six-month grace period on student loans for May graduates is coming to
an end. To make sure your child's credit record remains clean, help work
out a budget to juggle payments, rent and living expenses. Graduates
who are still looking for employment should investigate their deferment
options.
DECEMBER
SPENDING:
You don't have to brave the crowds even if you haven't gotten around to
your holiday shopping. Check out the hundreds of retailers that
participate in Free Shipping Day in the middle of the month at freeshippingday.com. Don't forget to tap into retailers' social media sites to stay on top of sales.
GIVING:
If you plan to give to a charity during the holidays, be sure the group
you're donating to is qualified before making a donation. Remember that
charitable contributions can only be deducted if you have receipts to
back them up. Further guidance is available on the IRS website.
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