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June 29, 2022

3 Tips to Help Avoid Extra Expenses

Use these strategies to cut back on extra fees so you can save for the future.

Student loans, rent payments, and monthly expenses; it can feel overwhelming to manage personal finances and save for future goals. You can start saving today by using free resources and tools to optimize your income.

Record your spending

Recording your monthly expenses is an effective strategy to prevent overspending. Compile all your expenses such as credit card statements and insurance payments, then place everything into one spreadsheet to gain a clearer view of your total monthly spending. This record can make you aware of unnecessary spending and recurring charges that can be cut out of your budget. Consider using a free budgeting app or a simple written record to track your spending and improve your budgeting.

Cut interest payments when you can

Once you have established a monthly budget for your income based on your expenses, you can use the remaining income to pay down your monthly expenses and debts so you can avoid increased interest payments over time. Another area that could be an extra charge is credit card fees. If you have an outstanding balance on your credit card each month, make sure that you have a low-interest rate on your card. You can switch to a better credit card or request your current credit card company to lower your rates. It never hurts to ask!

Read the fine print: insurance and taxes

When it comes to car and health insurance, research and comparison can give you substantial savings in the long run. Choose a plan that fits your lifestyle and watch out for renewal and cancellation fees or surcharges for accidents or pre-existing conditions. Another large expense that we all face are taxes. Before you receive your paycheck, income taxes are deducted. To take back some of your income, consider setting up a 401(k) retirement plan that will reduce the amount you owe in income taxes and set aside pretax savings. If you make charitable donations, don’t forget to save the receipts for tax deductions.

For extra budgeting resources, our experienced team at Citizens First Bank is here to help. You can give your local branch a call or visit in person for help with personal finances and more.