Building a strong financial foundation can be summed up in five words: Spend less than you earn.
Simple, but for many, it seems an overwhelming task.
We'll try to make it a little easier, with tips that could help you save thousands of dollars a year. Just take a close look at some everyday expenses and then follow a more frugal path.
I was talking with a friend recently who was lamenting the size of his electric bill. I asked about his rate, and he didn't know. Turns out he was paying 19 cents per kilowatt hour, with a variable rate that seemed to go up every month. I'd previously locked in a rate of 11 cents a kilowatt hour.
My peak bill last summer, for about 2,000 kilowatt hours, was $220. That same amount of power would have cost him $380.
Finding the cheaper rate and transferring my service took less than half an hour.
An (almost) free lunch
With the average cost of a restaurant lunch pushing $10, bringing lunch from home a couple of days a week makes a whole lot of sense _ and a potential savings of $1,000 a year. It's healthier, too. One lunch idea: leftovers from last night's dinner.
LOWER THAT POWER BILL
Still smarting from those utility bills? Check your electric bill to see how much you're paying per kilowatt hour and whether that rate is variable or fixed.
Check with your state's public utility commission for information about average rates and other tips on saving money. Consider going with another provider, if available, or calling your current provider and asking about fixed rates.
Suppose you want to lock in a rate for 12 months, and offers range from 12.6 cents per kilowatt hour to 19.9 cents. If you use 2,000 kilowatt hours a month, the difference between the cheapest rate and the most expensive is $146. If you use an annual average of 1,000 kilowatt hours a month, you'd save $73 monthly, or $878 a year.
Make sure you read a company's terms of service. Some may require term commitments, and some have terms for leaving. Also, locked-in rates won't save you money if rates go down.
PHONE HOME
The telephone is such a fixture in the American home we barely think about it. But service options have changed so much in the last decade you might be paying for services you don't need.
If you have separate local and long-distance services and you use your home phone quite a bit, look at plans that combine both, with no limits on minutes, for about $50 a month.
If you only occasionally dial long distance, check out alternative long-distance companies that offer lower per-minute charges than some of the big guys and break calls into shorter increments, some as small as six seconds, so you won't be charged for 11 minutes if your call lasts 10 minutes and 5 seconds. Look at www.saveonphone.com for some possibilities.
Should you drop your conventional phone service completely? Almost 15 percent of American households have. This can work if you get good call quality from home and have enough minutes in your cell plan to meet needs. The downside: Cell phones run out of juice if there's an extended power outage. But the same could be said for cordless phones.
If your cell phone service comes with free evening and weekend calls, use it for long-distance calls instead of a pay-by-the-minute long-distance service.
Speaking of cell phones
The problem with any long-term business relationship is the details get fuzzy with time. So if you've used the same cell phone provider and the same plan for years, take a fresh look.
If you don't use most of your allotted minutes, look for a plan with fewer minutes that might cost you less. If you're using too many minutes, raise the limit _ it's cheaper than paying the usual overage fees. The big caution with either of these: Changing a cell phone plan might trigger an automatic extension of your contract. Ask before you act.
If your current contract is about to expire, see which provider your family and friends use. Since many cell phone companies offer unlimited anytime minutes within the network, it might make sense to switch.
Do you find yourself dialing directory assistance on your cell phone on a regular basis, despite fees of up to $2 a call? Try 1-800-FREE-411 (that's 1-800-373-3411) instead.
LESS PAIN AT THE PUMP
True, gas prices have come down from last year's high, and fresh memories of $4-a-gallon prices make just about everything look like a bargain. But according to www.gasbuddy.com, prices for a gallon of regular unleaded can vary as much as 20 percent in the same neighborhood.
Services like www.gasbuddy.com and www.gaspricewatch.com let you check for the cheapest prices in your area.
Then, to squeeze the most from every gallon, borrow some of the tips at www.hypermiling.com and www.cleanmpg.com.
ONLINE SHOPPING
Web sites like www.bizrate.com, www.pricescan.com, www.pricegrabber.com and dozens of others make it easy to comparison shop in seconds.
To find really super deals, you need a broad network of shopaholics to help, and that's what you find on sites like www.slickdeals.net and www.fatwallet.com. Deals can come and go quickly, but those sites and others like them have search functions to help you find what you want at the best price possible.
One recent posting led me to a couple of items for myself _ a pair of dress slacks retailing for $95 and a dress shirt listing for $55. My total cost, with free shipping: $31.
CHEAP ENTERTAINMENT
We do love our big-screen TVs, with all those cable and satellite channels, the movies, the sports on HD. These days you can have it all, and some people pay $200 a month or more for the privilege.
There are those few among us, though, who have cut their ties with cable and satellite and instead watch classic shows on YouTube and their favorite new shows on the network Web sites.
DVD subscription services to Netflix can keep you in movies or even full seasons of favorite shows for less than $20 a month. You can cut the cost of movie night to about a buck by picking up a new release at a Redbox machine, found in many grocery and big-box stores.
Sometimes, though, you need a night out. But you can still save. Set up a baby-sitting system with family or friends and take turns watching the kids. At least you won't be paying for baby-sitting on top of everything else.
INSURANCE
If you think gas prices are all over the map, take a hard look at homeowners and auto insurance rates.
These days lots of insurance Web sites offer quotes from multiple carriers (www.insurance.com, www.netquote.com, www.insweb.com and www.insure.com just to name a few). You also can check with your state department of insurance to see if they offer rate comparisons or other saving tips. Rates can vary widely.
The price for a full-coverage policy on a 2007 Toyota Camry _ sample rates are based on that car or a Ford F-150 pickup truck _ ranged from $283 to $1,131 annually in one Dallas neighborhood.
Insurance with wind-damage coverage on a 10-year-old, $200,000 brick-veneer home in the same neighborhood ranged from $613 to $2,105.
These are only estimates, and all the usual disclaimers apply. But virtually all of the companies listed carry at least an "A" rating _ "excellent," according to A.M. Best's review of a company's financial strength.
You can also find significant insurance savings by raising your home or auto deductible _ but make sure you have savings available to cover the deductible if you have to file a claim.
The Insurance Information Institute put the average cost of car insurance in the U.S. at $847 in 2007. If you have a low deductible, raising it to $1,000 could reduce premium costs by 40 percent, about $340.
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