Fast Ways to Earn More and Spend Less | Personal Finance Views

Wednesday, December 10, 2014

Fast Ways to Earn More and Spend Less

Improving your cash flow can pose financial and emotional challenges. Increasing income may be limited by experience, industry and the economy.Cutting costs beyond more obvious leisure expenses can also be difficult.

Thankfully, there are easy ways to boost your cash flow and improve personal finances.

Here are some ideas to increase your paycheck and trim expenses with little sacrifice:

Reduce Your Income Tax Withholding

Tax refunds are an emotional high that test our financial discipline. Some taxpayers feel overpaying income tax during the year helps them budget more effectively.

Earn More and Spend Less

However, the time value of money is often overlooked when selecting tax allowances. In simple terms, this principle means money is more valuable today than at some point in the future.

Greater take home pay provides disposable income to start investing or minimize interest expense.Compounding is a powerful financial concept that rewards those who simply get started, even in the smallest increments.

Many investments such as mutual funds and direct stock purchase plans can be started for under $100. Meanwhile, paying more money towards debt now has outsized benefits in terms of interest savings.

An online tax withholding calculator helps raise allowances without having to owe money at year end.

Would more take home pay help you start investing or pay off debt faster?

Increase Your Car Insurance Deductible

The replacement value of your car declines over time. Many drivers carry low deductibles that do not reflect the age or worth of their vehicles.

Auto damage to the body, transmission and engine may exceed the value of some older vehicles, making repairs impractical. The risk management principles used by money managers has everyday value to car insurance, as well.

Upping your auto insurance deductible drops premiums and results in quick savings. Is your auto deductible too high?

Car Refinancing

Those who financed cars over a year ago can take advantage of low interest rates in Canada and the U.S. to refinance their auto loans.

Aside from monthly savings and lower interest expense, the first payment for a newly refinanced car loans not typically due for 60 days.

When was your car financed and at what interest rate?

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