Piggy Bank Fix

When there’s more month left at the end of your money, it’s time to get some help. Here are five tips from Kimberly Earnest, financial fitness coordinator for Veterans United Home Loans.

Entertainment
Set a monthly budget and use the cash envelope system – putting cash in an envelope and only using it for entertainment. Look for free to low cost alternatives of things to do in Columbia by checking out websites like hulafrog.com and como.gov/parksandrec/. Cut cable and use alternatives such as an antenna, Netflix, Hulu, and Amazon Prime. Also, be sure to check out the Columbia Public Library for free rentals and streaming services. Have friends over for a game or movie night with dinner potluck!

Mortgages
When purchasing a home, have no more than 25% of your take-home pay going toward your mortgage payment, ideally on a 15-year fixed rate mortgage. To decrease your loan amount and monthly payment (and possibly avoid PMI – Private Mortgage Insurance), put as much as you can on a down payment while still saving money for an emergency fund. Thoroughly research and understand the different loan options available to find the best one for you.

Grocery Shopping
Meal planning is a great way to save money on food, decrease food waste, and decrease the number of times you eat out. Plan out meals for your family one week at a time based on your schedule for the week (i.e. having leftovers ready to go on a night when there is a short turnaround time for an evening activity). Shop with a list of what you need and never shop hungry.

Utilities
Get a free residential energy audit from the City of Columbia, which can help you figure out what habit changes, structure issues, and equipment might reap you the highest benefits. Look into rebates for energy improvement projects and always consider how long it will take before the improvement project savings are greater than its cost. Manually adjust your thermostat (or automatically with a programmable thermostat) when you aren’t home and at night when you are sleeping.

Transportation
The average new car payment is $550 for 69 months – over $38,000 for something that typically loses 60% of its value in the first five years. Purchase a used car to avoid that depreciation or purchase a car outright to save yourself a monthly payment. If you do take out a loan, consider the full cost of the vehicle and not just the monthly payment, and pay it off quickly. Regular maintenance checks also can help avoid major repairs down the road.