Tips for Jump-Starting Your Finances for 2016- Part II

In my column two weeks ago (HOT-LINK), my colleagues provided 10 tips for jump-starting your finances for this year.  In this week’s column, readers have offered their own favorite ideas:

  • For one month, I put all of my change in a jar.  For the month of December, I collected $46.16.  Linda M. 

My comment: Congratulations, Linda!  This is a great suggestion for the whole year.  Simple and effective.  Maybe you could attach a goal for the money such as use it to fund holiday purchases in December, pay down debt or make a gift to a specific charity.  This could give it more meaning and fun and might encourage others in the family to participate.

  • I’ve always been thrifty, but I became thriftier two years ago when Medicare Part D refused to help pay for my medically necessary prescription medication.  Here’s what I did:
  1. I compared prices at pharmacies, both chain and independent;
  2. I bundled my auto and homeowner insurance policies;
  3. I prepared and ate all meals at home except for special occasions;
  4. I stopped buying products and services I didn’t need or really wanted.

Did these additional cutbacks cover all of my medication cost?  No, not by an Alabama country mile.  Yet today, I’m happier and healthier than I’ve been in a long time, and to me, that is priceless.  Lucy C. 

My comment: It’s amazing what people can accomplish when motivated!  Well done.

  • Thank you for an opportunity to share my financial tip! Many years ago I remember my dad talking to my mom about their new budget: an envelope system where he put cash into the grocery envelope, school envelope, gasoline envelope, etc. Just a few months ago, I thought this would a good way to help me save for Christmas gifts instead of charging on credit cards that I’m trying to pay off before I turn 65 (in 3 years!) So I began packing a lunch and bringing homemade tea to work to help with my plan. I resisted buying new clothes because I don’t need any and there was no cash in the clothing envelope. I bought gas gift cards on payday and put cash into other envelopes for groceries, charity, personal & Christmas! I also clipped a lot of coupons-lots of stores offer them on toys and even reward you with a gift card for using their store! I saved over $500 in cash to spend on my grandkids and kids and steaks on Christmas Eve! I feel great that my plan worked even though I only have a part-time retail job and a small pension. Jennifer S.

My Comment:  This is a perfect case of individual determination.

  • I have two suggestions (Marynell W.):
  1. Take your lunch to work. Prepare what you are going to take the evening before so if you’re running late, it will be ready. This could potentially save you a lot of money, cut your calories and help you meet your fitness goals.
  1. When you take $20 or $40 out of the ATM, keep track of what you spend the money on. Before you know it, that money is gone and you are back at the ATM again. You will probably find that it was used for things you really didn’t need.

My Comment:  My guess is that bringing your lunch to work versus buying it would save from $5 to $10 per day.  Over the course of a year that could easily add up to $1,250 to $2,500!  Think of what smart financial moves you could make with that much money!

  • I have two suggestions (Tom B.):
  1. Read, read, read: Spend a minimum of 10-15 minutes a day reading publications and articles on investing and personal finance. The additional knowledge will show itself in greater confidence and lessen the chances of costly mistakes.
  2. Be ever-aware of investing expenses, be they trading commissions or embedded fees. Overlooked, they can eat away at or even offset investment returns. Make expenses a part of every investment decision. 

My comment:  I think most people would be amazed at how much knowledge they’d have in a year if they read just 10 minutes per day about investing.  And they’d certainly learn the importance of keeping expenses low.

Pick two or three of these suggestions to implement for 2016 and jump-start your own finances!