How to Cut Costs and Increase Savings in Your Budget

Budgeting money is key to surviving through a tough economy, and everyone knows the basic tips for saving money. However, there are other ways that are often overlooked when it comes to trimming the fat out of the monthly bills. And there are some areas that are commonly overlooked. So you think you have cut all the extras out and are on your way to saving more money. But are there other methods that you may have missed?

Stop Paying Late Fees

When money is tight, it becomes very easy to start falling behind on bills and are even harder to catch up on. However, monthly utility and credit card bills are the last item you want to fall behind on. The average late fee is around $5 per month, and can be much more when it comes to credit cards. If you are late every month on a bill with a $5 late fee, you have paid an extra $60 on a bill you didn't have to pay. And if you have 3 bills (electric, cable, and phone) and you are late on them all year, that's $180 spent on fees and money you could have used elsewhere. If you are behind, try to catch up as quickly as possible and then remain ahead. Start with the bills that have the highest late fees and work your way through until all your payments are up to date.

Use Pre-Paid Credit Cards

Pre-paid credit cards are a great resource to use when you have a difficult time sticking to a budget. I chose to use my pre-paid card to stick to my grocery budget, which was the hardest part of my spending to curb. After all, those extra items you do not need can add up quickly. At the beginning of the month load your card with your budget amount, and do not reload your card until the next month. When your spending limit is a clear cut amount in front of you, you are less likely to steer away from your budgeted amount.

Cut the Cable

When I had to trim down the extras in my budget, the cable television had to go. Why? It was something that I used rarely, and was unhappy with the programming. Instead, I turned to DVD rental programs (and I can't say I miss the commercials!) For example, you can rent DVD's through programs like Netflix, Redbox, and Blockbuster - and these will greatly reduce the price you pay for television. Also, the library is a great resource for free movie rentals. By using these methods I cut $50 out of unnecessary spending for television entertainment at home.

The Library

This seems to be forgotten resource that is recently regaining popularity. Why pay for books when you can read them for free? Also, this can be a place where you can take advantage of movie rentals and free internet connection. Magazines are also readily available, so you can cut out the magazine subscriptions - chances are you are not reading them cover to cover, and once they are read they are never opened again. If you want a particular article, just make a copy at the photocopier. If you are set on buying that book or magazine, go to a used book store. Chances are you will find what you are looking for in new or almost new condition.

Video Game and Console Rentals

Chances are your child (or you) will want a game system and games to play at one point or another. But are they (or you) going to keep playing it? By renting a gaming console first, you can see exactly what happens. Most of the time when the shine wears off it is not played as often or not at all. If this happens you can return the console and not lost the average $200 or more you would have spent. Also video game rentals can help sort through all the available games - and you will have avoided spending $50 for a game that will never be played.

Pet Toys

Does your pet really need a new toy? As pet owners, we care more about giving our pets new toys, trinkets, and collars than our pet cares about getting them. My dog and cat love old boxes and plastic bottles more than the shiny toys I found at the pet store. You can splurge on your pet once and a while, but if they are happy playing in and with a paper bag, I will give them one anytime and they don't cost a dime.