Archive for the ‘Reducing Expenses’ Category

Turn Big Ticket Dreams into Reality

Studio, hands, money, white background, five, ten, one, dollar bill. UF/IFAS Photo: Marisol Amador

Whether you’re saving for an automobile purchase, a special vacation, a new home, or retirement — a little planning and budgeting can turn a fuzzy dream into a reality. Use a step-by-step planning approach, take actions to reach your goal, and then you can sit back and reap the benefits.

Set Your Goal. Name your goal with as much specificity and detail as possible. Consider the advantages of achieving the goal. What will be the effect if the goal is not achieved or achieved at a different level?

Do Your Research. How much is it going to cost? Are there different alternatives? Compare the different costs and alternatives. Which option fits best with your current and  projected lifestyle?

Anticipate Obstacles. Visualize obstacles and strategies to overcome those obstacles.

Name an Amount. Set a realistic dollar amount to your goal. A specific dollar amount can help you measure progress. Remember to consider all the associated costs.

Make a Plan. Compare your current budget to the
allocation needed for your goal. You might need to make some changes to your spending to make savings happen. Again, be realistic; is this goal attainable? Do modifications need to be made?

Set a Target Date. Even if that date is years away, now is the time to start planning and saving. Divide the cost of your goal by the amount you’ll be able to save each pay period. The further out, the less you need to allocate.

Automate Your Savings.  Use direct deposit to send the money directly to the appropriate savings vehicle.

Use an Appropriate Account. If the goal is five years or less away, a savings account is likely the most appropriate savings vehicle. Consider whether it would be helpful to open a separate savings account for goal funding.

For long term goals, such as retirement, consider a tax-advantaged retirement investment account. Start by
investigating workplace retirement plans. If  a workplace plans is not available investigate Individual Retirement
Accounts (IRAs).

Avoid temptation. Set-up an account that is not so easy to access. One strategy is to open an account and don’t keep an ATM card or debit card for that account.

Earmark windfall income. Depending on how long you’ve determined it will take to reach your savings goals, you may want to plan to move any additional non-budgeted income directly into savings. Receiving an end of year bonus? How about a tax refund? Allocate some of that  money for your goal.


Money Saving Strategies

The average person needs to manage expenses carefully to make ends meet. A good first step is to build a savings fund so there is cash available to cushion against the unexpected and also enable you to take advantage of money saving opportunities. Below are some ideas for saving money.

High Insurance Deductibles: Save money on insurance by increasing deductibles. This can result in a lower premium and the ability to afford higher coverage limits.

Automobile Insurance: Pay auto insurance in full instead of making several premium payments.

Extra warranties: Think twice before purchasing an extended warranty. These add-ons can be expensive relative to the protection provided. Many products already come with a warranty and you may not need extra protection.

Credit Score Monitoring Subscriptions: Paying money to watch your score will not cause it to increase. Using that money to pay debts is likely to increase a score. If you are worried about identity theft consider free or low cost  options such as a credit security freeze.

Read Your Automobile Manual: This will tell you the type of gasoline required and how often to change your oil. In many cases high octane fuel does not help performance. In addition, you may find that the old rule about changing the oil every 3,000 miles does not apply to your vehicle.

Save Money on Your Electric Bill

The season of hot, steamy weather and high electric bills is approaching. So do all you can to evaluate your home energy use and increase energy efficiency. Tampa Electric offers free energy audits in 3 ways: do-it-yourself online survey, DIY telephone audit, and in-person home inspection by a Tampa Electric energy analyst.  

In the typical Tampa Bay Area home powered by electricity, air conditioning accounts for the highest portion of energy use. So keep your air conditioning system at peak performance. Check air filters every month and clean or replace regularly as needed. When you are away for more than 4 hours, turn your thermostat off (unless you have pets, then turn it to a temperature that they can tolerate). Ceiling fans increase your comfort level by improving air circulation and making you feel cooler. But they do not actually reduce air temperature, so when you leave a room turn off the fan to save money.  

For more information check out the new University of Florida publication “Improving Savings and Health through Minor Conservation Measures in the Home” at


Dealing with Reduced Income

Many of us are dealing with reduced income because of furloughs, healthcare insurance increases, or job loss. When that happens we need to find a way to compensate for the lost take-home pay (like getting a part-time job) or cutting back on expenses. We all know increasing income is hard to do, so for many of us that means reducing some of our expenses. I know I have had to make some cuts such as eliminating gym expenses and changing phone service options. Of course we all have different priorities. But by exchanging ideas we help each other think of new cost cutting strategies. So if you have any good suggestions please comment.

I have also posted a worksheet to, click on the link on the right side of the page that says “Dealing with Reduce Income Spending Plan Worksheet.”