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Five top Money Saving Myths

We all think we do the best we can when it comes to our finances. We think we are saving money, but we never sit down and do math. You may be surprised if you do.

Here are the top five money-saving myths that fall for:

1. Savings accounts save us money

When you refinance your home, you surely are not saving that much money in the long term. Yes, your monthly payments are lower, but you refinanced for another 30-year term. This means that if you have already paid 10 years of the mortgage, then refinance for a further 30 have essentially extended its credit to 40-year mortgage. Sit and do math and you’ll see if they are really saving anything.

If you really want to save money, refinance to lower rates and a shorter period. Your monthly payment may not come down, but the discharge in May

2. Refinancing your home pays off

When you refinance your home, you surely are not saving that much money in the long term. Yes, your monthly payments are lower, but you refinanced for another 30-year term. This means that if you have already paid 10 years of the mortgage, then refinance for a further 30 have essentially extended its credit to 40-year mortgage. Sit and do math and you’ll see if they are really saving anything.

Then if you never use the item that you are actually losing money. This may apply to the transaction of shopping and shopping in bulk. It does not matter whether you bought your daughter 35 pairs of shoes a garage sale for $ 1 each. If she had only two pairs of them, I just lost $ 33.

Having money in a savings account for emergencies is a good idea. It is easy to obtain, but not too easy. But if you want to save money or make your money work for you, old-fashioned savings account is not necessarily the best way to go. First, you should look at what give in interest rates. For example, if you have a student loan with 5 percent interest rate and savings account to 3% interest rate, your savings have cost you about 2 percent. You would be better off paying off that student loan with savings account.

It goes the other way around too. If your debt is less than the interest rate on your savings, your money works better savings. But with today’s interest rates are so low, your debt is probably higher than the amount of interest earned on your savings account. This means that they are actually losing money.

4. Sales shopping saves money

I used to be a shopaholic, but drug sales are my choice. To say that does not always save money. Yes, if you really need the item, then you’re saving money. But sales often leads to purchase of items which normally would not be purchased. And you usually buy twice as much because it is on sale. So you have not saved any money.

Then if you never use the item that you are actually losing money. This may apply to the transaction of shopping and shopping in bulk. It does not matter whether you bought your daughter 35 pairs of shoes a garage sale for $ 1 each. If she had only two pairs of them, I just lost $ 33.

5. Savings depend on income

No matter what you do, you can save money. You just need to spend less than you make. If you can spend more money and more money, you are not saving anything. In fact, you may even be spending more. Do not wait until you have more money to start saving. You must start now.

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Learn How to Save Money

Whether it is a bad economy or a great economy, everyone wants to save money one way or another. The more you save, the more money you have to spend on things you want more. Let’s talk about different ways to save so you can save more money.

First, think about where your money goes. How much stuff do you spend your money on that you don’t use regularly, or maybe that you don’t even use at all? For instance, how many television channels do you pay for? If you get thousands of channels, but you only watch a few, is it worth paying that much money for more channels than you really watch anyway? If you barely watch TV at all, maybe you could just forget about television altogether?

Think about everywhere they you spend money on things they don’t actually use regularly. Television is just one example. Some of these may include your cell phone, land-line, Internet access, magazine subscriptions, DVD rental service, or anything else that you subscribe to that you don’t really use.

How often do you eat out? The more you eat out, the more you are spending. If you could even just cut your eating out in half, you could probably save quite a bit of money, especially if you go to expensive restaurants. If you buy takeout at all, cut that out because it is definitely not a necessity.

What about your groceries? You can save a lot of money on groceries if all you did was use coupons. If all you did was buy store-brand, you would save a lot to. Think about what would happen if you bought store-brand, used coupons, only bought what was on sale, used the store loyalty card, and only bought what you would eat, you could probably at least cut your bill in half.

What you want to do is cut back on your spending. That is the best way to save. Do not just look for good deals, because often you do not need this at all and by not buying it, you will save even more. Be a smart shopper and you will save more money.

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