How to Cut Your Monthly Expenses
With unemployment rates soaring and many people facing job losses, reducing your monthly debt is critical to your personal economic survival. Here's a few steps you can take to reduce your monthly expenses.
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Instructions
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List your monthly expenses. There will be some expenses that are fixed - you cannot reduce or change them and many other expenses are flexible and can be reduced. Fixed expenses are expenses such as real estate taxes. Flexible includes groceries, electric, etc.
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Credit Card Debt: Making minimum payments to the credit card only prolongs the debt and usually results in a growing balance - you just can't get ahead if paying the minimum amount due. Check your monthly statement, what rate is being charged? Any other fees such as Late Fees? Call the credit card company and request a "Hardship Rate". Some credit card companies are reluctant to offer hardship rates, you will probably have to call a couple of times before you reach a representative willing to help (it's easier to tell you 'No, we don't offer that' than it is to help you) Be persistent.
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Have a car payment? Call the finance company to request a hardship rate. Many finance companies will offer deferred payments or interest only payments. Interest only payments will not have a negative impact on your credit report but will help you keep payments current when struggling with finances.
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Mortgage Payments. If you haven't already done so, call your lender and get a lower rate and extend the term of your note. You do not have to be in default to obtain a loan modification. Please see link below for info How to Talk to Your Bank.
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Groceries. Make a list - buy only what is on the list, don't be lured by attractive displays. Clip coupons for groceries ... and everything! Watch for sales - Buy-One-Get-One sales are a great way to save on items that store easily such as mayonnaise, toothpaste, paper products, etc.
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Electricity. Unplug electric items when not in use. It really does make a difference in the electric bill. Unplug phone chargers, WII, small appliances, shredders, etc. Turn off ceiling fans unless you are in the room. Be watchful of the temperature setting on your thermostat. It all adds up.
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Tips & Warnings
Clipping coupons, unplugging electric items, calls to loan companies & banks may seem like a hassle at first but the pay-off comes when your monthly debt is reduced to a more manageable level.
Hang in there - our economy will recover and times will be good again!
Be sure to be patient but firm when requesting interest rate reductions. As mentioned; too often representatives find it is easier to tell you "No" than to help. Be persistent.
Keep your Hardship short and to the point is best - a simple phrase like "Loss of Income" vs. a long story about how bad your boss is/was.
