365 Ways to Live Cheap (17 page)
214. U
SE
Y
OUR
F
LEXIBLE
S
PENDING
A
CCOUNT
Many employers offer a flexible spending account to accompany their health insurance plan. This flexible spending account allows you to pay for some medical expenses with pre-tax money, saving you on your income tax. Take advantage of this if it’s available to you, particularly if you have any maintenance prescriptions, ongoing health situations, or dependents who may have medical concerns. In fact, your flexible spending account can make it cheaper to go to your own regular medical checkups, which will go a long way toward keeping you in good health.
215. W
ASH
Y
OUR
H
ANDS
The common cold destroys countless hours of productivity each year, causing people to miss days at work and miss out on income and other opportunities as well. If you’re self-employed, a cold can be utterly devastating, resulting in lost work hours, missed contract opportunities, and other negative effects. These lost opportunities can often be prevented by doing the simplest of things to prevent the common cold: washing your hands regularly. Wash them every time you use the restroom and just before you handle food. Doing both will go a long way toward reducing your chances of getting a devastating cold.
216. P
RACTICE
G
OOD
H
YGIENE
Along with washing your hands, you can not only prevent illnesses but also improve your appearance to others by practicing good basic hygiene. For many, this is common sense, but it only takes one whiff of a person with bad breath to see how devastating that poor hygiene can be and one look at a person with bad teeth to see how costly poor hygiene can be. Take a shower daily. Brush your teeth at least once a day. Use deodorant. Keep your clothes clean. The key is to keep yourself presentable and avoid germs that could bring on illness.
217. D
RINK
M
ORE
W
ATER
Drinking adequate amounts of water improves your energy, increases your mental and physical performance, removes toxins from your body, reduces the chances of a heart attack, and helps you lose weight. Pretty amazing what a few more glasses of water can do each day, isn’t it? The average American drinks far less than the appropriate amount of water each day. You should be drinking eight 8-ounce cups of water each day at a minimum (approximately five tumbler glasses full of water). Not drinking that much? Try drinking a tumbler full of water each time you begin to feel hungry during the day, making sure that you drink your minimum of five a day. You’ll find your hunger lessens (saving you money on food) and after a while you’ll begin to feel genuinely better both physically and mentally (improving your earning potential). That’s not even counting the other health benefits. A glass of water is the best cheapskate deal of all.
218. E
AT
B
REAKFAST
E
VERY
D
AY
Eating a low-fat breakfast each morning, such as a bowl of healthy cereal or a piece of fruit, not only has a tremendous positive effect on your late-morning energy level and mood, but it also improves mental performance throughout the day. Even better, it keeps you thin by getting your metabolism going earlier in the day. Not only that, it also has the effect of subtly reducing your appetite at lunchtime and later in the day, resulting in lower overall food costs if you eat an inexpensive breakfast. A quick banana on your way to work can end up making your workday easier and save you money on lower food costs over the long run.
219. E
LIMINATE
S
MOKING AND
M
INIMIZE
D
RINKING
Drinking and smoking, especially when done with any frequency, can be incredibly expensive habits by themselves, never mind the high health care costs they can bring on later in life. If you’re a regular user of either, work hard to break the habit and you’ll find yourself with substantially more money in your pocket and better all-around health, both now and in the future. If you’re having trouble breaking the habit, ask for help from your friends and family. They’ll help you work through breaking a difficult habit.
220. S
LEEP
M
ORE
Sleeping more by itself doesn’t directly save you money, but inadequate sleep can certainly cost you money. Lack of sleep can reduce your mental sharpness, costing you money when you make silly mistakes. It can also cause you to spend money on convenience because you’re tired, and it can also make you more susceptible to advertising and coercion because your mental defenses aren’t sharp. Make sure you get an adequate amount of sleep each night, seven to eight hours at least, to ensure that your mind is sharp and you don’t lose money in such preventable ways.
221. S
CHEDULE
R
EGULAR
M
EDICAL AND
D
ENTAL
C
HECKUPS
Many medical and dental conditions can be easily and inexpensively treated if caught in the early stages, but can be very expensive to deal with if caught in later stages. The solution to this conundrum is simple: Get regular medical and dental checkups. Such regular checkups are covered by almost all health insurance policies, as it’s far cheaper for the insurance companies, too. So regular checkups often incur only the smallest of expenses while avoiding some potentially monstrous expenses down the road. Regular medical and dental checkups are an incredibly cheap deal compared to the huge costs you might face without them.
222. T
ALK TO
Y
OUR
D
OCTOR ABOUT
I
NDEPENDENT
S
TEPS
If you discover that you have a medical condition, ask your doctor about independent steps you can take to minimize the effects no matter what the condition is. Almost every condition can be improved by making certain choices in your life, and making those choices can almost always reduce your potential future medical bills. So, if you’re diagnosed with a condition, always ask what you can do to help minimize the effects or damage of that condition.
223. C
ONSIDER
T
RAVELING FOR
S
URGERIES OR
O
THER
M
EDICAL
C
ARE
One medical option that many people don’t consider is the possibility of traveling to another country for expensive medical care, such as major surgeries or lengthy treatments. Depending on your insurance, you may be able to save a significant amount of money out of your own pocket by exploring these opportunities. If it appears as though a surgery or other major medical procedure is in your future, call your health insurer and ask if there are any available options for reducing the overall cost, including traveling to another region of the country or traveling abroad for the procedure. Many insurance companies are quite happy to send you to another country for medical work, then send you back, in order to save a significant amount on the procedure, as it can be done in other areas at the same level of quality for much less. If you find out that you are going to have a major medical procedure, don’t panic. A bit of planning now can save you a ton of money later.
224. A
SK
Y
OUR
D
OCTOR FOR
P
RESCRIPTION
S
AMPLES
Whenever you’re given a prescription, ask your doctor if they have any samples of the prescription available that they can give you. In many cases, the sample may be enough to eliminate a prescription refill, saving you money. It can also tide you over until you can go to a lower-cost pharmacy to get your prescription filled, saving you money merely by giving you more freedom to choose your pharmacy.
225. A
SK
Y
OUR
D
OCTOR ABOUT
G
ENERICS
Now that many pharmacies are offering $4 generic prescriptions, you can save quite a bit of money merely by asking your doctor whether or not there is a generic version of your prescription available that will work for your condition. In many cases, the generic is a perfect equivalent of the name-brand prescription, and thus substituting the generic for the name-brand prescription can save you a great deal of money at the pharmacy. Always ask your doctor about generics when you’re given a prescription. It can save you a lot of money, particularly on a maintenance prescription that you’ll refill many times.
C
HEAP
T
ACTIC
$
FOR
H
OUSING
226 If You’re Planning on Moving in the Next Five Years, Rent
227 If You Don’t Have a Down Payment Yet, Rent
228 Consider a Cheaper Neighborhood
229 Consider a Cheaper Part of the Country
230 Get a H
UD
-1 Form and Know What Lenders Will Be Looking At
231 Get a Shorter-Term Mortgage with a Lower Interest Rate
232 Know Exactly What You Can Afford Before You Look
233 Buy on the Low End of What You Think You Need
234 Look for a Fixer-Upper but Avoid Homes with Problems You Can’t Fix
235 Know the Total Cost of the Move Before You Jump
236 Ask the Seller to Pay Closing Costs and Other Fees
237 Shop Around for a Mortgage
238 Attend the Home Inspection Yourself and Ask a Lot of Questions
239 Be Aware of Any Homeowners’ Associations or Covenants You’ll Have to Adhere To
240 Practice a Monthly Home Maintenance Schedule
241 Learn How to Do Simple Home Maintenance Tasks
242 Don’t Overspend on a Lawn Mower or Other Home Maintenance Equipment
243 Build Relationships with Your Neighbors
244 Consider Building Yourself
245 Consider an Alternative Living Situation
226. I
F
Y
OU
’R
E
P
LANNING ON
M
OVING IN THE
N
EXT
F
IVE
Y
EARS
, R
ENT
Considering buying a home because it’s a “good investment”? That idea is conventional wisdom, but there are many cases where it simply isn’t true. For example, if you’re intending to move away from the area within the next five years, it’s more cost-effective to rent rather than buy. Why? During the first five years of your mortgage, almost all of your payment will go toward interest in the property, not toward equity. In fact, when you consider the closing costs from buying the house, plus the realtor fees when you sell the house, that will eat all of the equity in the house and more in almost all housing markets. Instead, look for an inexpensive place to rent in the area until you’re ready to move on, as rent is almost always far cheaper than house payments. Sock away that difference for the future.
227. I
F
Y
OU
D
ON
’T H
AVE A
D
OWN
P
AYMENT
Y
ET
, R
ENT
It’s tempting to go ahead and buy a home as soon as you feel ready, regardless of whether you have the money or not. However, diving into buying a home without a full down payment can be a huge financial mistake that will cost you for decades. Most lenders expect you to have 20 percent down when you buy a home. Buying without that down payment usually gives you several options, none of them pretty: a second, smaller loan with a much higher interest rate, or private mortgage insurance to ensure that the lender will be protected against the mistakes of an unprepared home buyer. Both options will cost you a lot of money that you won’t get back. Instead, get into an inexpensive rental situation and get serious about saving for a down payment. Use the other tactics in this book, live as cheap as possible, save up that 20 percent, and then buy. You’ll save yourself a tremendous amount of money by exercising some patience.
228. C
ONSIDER A
C
HEAPER
N
EIGHBORHOOD
It’s wise to be the richest person in a cheaper neighborhood than to be the poorest person in a rich neighborhood. In the cheaper neighborhood, you won’t be surrounded by peer pressure to constantly spend more to keep up with the Joneses. In the expensive neighborhood, you’ll constantly be surrounded by temptations to spend money that you don’t really have. Look to buy in a less expensive neighborhood at first, and if you’re still tempted to move up, save the extra money you’re not spending trying to keep up and eventually upgrade. You’ll save a ton of money by keeping the expensive Joneses at bay.
229. C
ONSIDER A
C
HEAPER
P
ART OF THE
C
OUNTRY
Many areas of the country have prohibitively expensive housing costs that can singly devour any extra income that can be made from living in that area. Look at living in another region of the country, even if it means a reduction in salary. If you can buy a house for $200,000 in Des Moines that would have cost nearly a million in San Francisco, you’ll be substantially ahead even if you take a lower paying job. Also, don’t merely assume you can’t find work in your area of expertise in those other areas. Take a serious look at the job markets in some of the less expensive areas and you might just be very surprised at what you’ll find.
230. G
ET A
H
UD
-1 F
ORM AND
K
NOW
W
HAT
L
ENDERS
W
ILL
B
E
L
OOKING
A
T
