TRANSPORTATION
Airline Fares
1. You can lower the price of a
round trip air fare by as much as two-thirds by making certain
your trip includes a Saturday evening stay-over, and by purchasing
the ticket in advance.
2. To make certain you have a cheap fare, even if you use a travel
agent, call all the airlines that fly where you want to go and
ask what the lowest fare to your destination is.
3. Keep an eye out for fare wars. Be prepared to act quickly.
Car Rental
1. Since car rental rates can vary
greatly, shop around for the best basic rates and special offers.
2. Rental car companies offer various insurance and waiver options.
Check with your insurance agent and credit card company in advance
to avoid duplicating any coverage you may already have.
New Cars
1. You can save thousands of pounds
over the lifetime of a car by selecting a model that combines
a low purchase price with low financing, insurance, petrol, maintenance,
and repair costs. Ask your local librarian for new car guides
that contain this information.
2. Having selected a model, you can save hundreds of pounds by
comparison shopping. Call at least five dealers for price quotes
and let each know that you are calling others.
3. Remember there is no "cooling off" period on new
car sales. Once you have signed a contract, you are obligated
to buy the car.
Used Cars
1. Before buying any used car:
a. Compare the seller's asking price with the average retail price
in a "bluebook" or other guide to car prices found at
many libraries.
b. Have a mechanic you trust check the car, especially if the
car is sold "as is."
2. Consider purchasing a used car from an individual you know
and trust. They are more likely than other sellers to charge a
lower price and point out any problems with the car.
Car Leasing
1. Don't decide to lease a car just
because the payments are lower than on a traditional car loan.
The leasing payments may be lower because you don't own the car
at the end of the lease.
2. Leasing a car is very complicated. When shopping, consider
the price of the car, your trade-in allowance, any down payment,
monthly payments, various fees (excess mileage, excess "wear
and tear", end-of-lease), and the cost of buying the car
at the end of the lease.
Petrol
1. You can save hundreds of pounds
a year by comparing prices and using the lowest-octane called
for in your owner's manual.
2. You can save up to œ 50 a year on petrol by keeping your
engine tuned and your tires inflated to their proper pressure.
Car Repairs
1. Consumers lose millions of pounds
each year on unneeded or poorly done car repairs. The most important
step that you can take to save money on these repairs is to find
a skilled, honest mechanic. Before you need repairs, look for
a mechanic who:
* is certified and well established;
* has done good work for someone you know; and
* communicates well about repair options and costs.
INSURANCE
Car Insurance
1. You can save several hundred
pounds a year by purchasing car insurance from a licensed, low-price
insurer. Check typical prices charged by different companies.
Then call at least four of the lowest-priced, licensed insurers
to learn what they would charge you for the same coverage.
2. Talk to your agent or insurer about raising your deductibles
on collision and comprehensive coverages to at least œ 300
or, if you have an old car, dropping these coverages altogether.
Taking these steps can save you hundreds of pounds a year.
3. Make certain that your new policy is in effect before dropping
your old one.
Homeowner Insurance
1. You can save œ 50 or more
a year by purchasing homeowner insurance from a low-price, licensed
insurer. Check typical prices charged by different licensed companies.
Then call at least four of the lowest priced insurers to learn
what they would charge you.
2. Make certain you purchase enough coverage to replace the house
and its contents.
3. Make certain your new policy is in effect before dropping your
old one.
Life Insurance
1. If you want insurance protection
only, buy a term life insurance policy.
2. If you want to buy a whole life, universal life, or other cash
value policy, plan to hold it for at least 15 years. Cancelling
these policies after only a few years can more than double your
life insurance costs.
3. Check your public library for information about the financial
soundness of insurance companies and the prices they charge.
BANKING/CREDIT
Cheque
1. You can save more than œ
50 a year in fees by selecting a cheque account with a minimum
balance requirement that you can, and do, meet.
2. Banking institutions often will drop or lower their fees if
paycheques are directly deposited by your employer. Direct deposit
offers the additional advantages of convenience, security, and
immediate access to your money.
Savings and Investment Products
1. Before opening a savings or investment
account with a bank or other financial institution, find out whether
the account is insured by the government. An increasing number
of products
offered by these institutions, including mutual stock funds and
annuities, are not insured.
2. To earn the highest return on savings (annual percentage yield)
with little or no risk, consider certificates of deposit and treasury
bills or notes.
3. Once you select a type of savings or investment product, compare
rates offered by different institutions. These rates can vary
a lot and, over time, can significantly affect interest earnings.
Credit Cards
1. You can save as much as several
hundred pounds each year in lower credit card interest charges
by paying off your entire bill each month.
2. If you are unable to pay off a large balance, switch to a credit
card with a low annual percentage rate (APR).
3. You can reduce credit card fees, which may add up to more than
œ 50 a year, by getting rid of all but one or two cards,
and by avoiding late payment and over-the-credit limit fees.
Car Loans
1. If you have significant savings
earning a low interest rate, consider making a large down payment
or even paying for the car in cash. This could save you as much
as several thousand pounds in finance charges.
2. You can save as much as hundreds of pounds in finance charges
by shopping for the cheapest loan. Contact several banks, your
credit union, and the car manufacturer's own finance company.
Mortgage Loans
1. You may save tens of thousands
of pounds in interest charges by shopping for the shortest-term
mortgage you can afford. On a œ 50,000 fixed-rate loan at
8% annual percentage rate (APR), for example, you will pay œ
45,000 less in interest on a 15-year
mortgage than on a 30-year mortgage.
2. You can save thousands of pounds in interest charges by shopping
for the lowest-rate mortgage with the fewest points. On a 15-year,
œ 50,000 fixed-rate mortgage, just lowering the APR from
8.5% to 8.0% can save you more than œ 2,500 in interest
charges. On this mortgage, paying two points instead of three
would save you an additional œ 500.
3. If your local newspaper does not periodically run mortgage
rate surveys, call at least six lenders for information about
their rates (APRs), points, and fees. Then ask an accountant to
compute precisely how much each mortgage option will cost and
its tax implications.
4. Be aware that the interest rate on most adjustable rate mortgage
loans (ARMs) can vary a great deal over the lifetime of the mortgage.
An increase of several percentage points might
raise payments by hundreds of pounds per month.
Mortgage Refinancing
1. Consider refinancing your mortgage
if you can get a rate that is at least one percentage point lower
than your existing mortgage rate and plan to keep the new mortgage
for several years or more. Ask an accountant to calculate precisely
how much your new mortgage (including up-front fees) will cost
and whether, in the long run, it will cost less than your current
mortgage.
Home Equity Loans
1. Be cautious in taking out home
equity loans. These loans reduce the equity that you have built
up in your home. If you are unable to make payments, you could
lose your home.
2. Compare home equity loans offered by at least four banking
institutions. In comparing these loans, consider not only the
annual percentage rate (APR) but also points, closing costs, other
fees, and the index for any variable rate changes.
HOUSING
Home Purchase
1. You can often negotiate a lower
sale price by employing a buyer broker who works for you, not
the seller. If the buyer broker or the broker's firm also lists
properties, there may be a
conflict of interest, so ask them to tell you if they are showing
you a property that they have listed.
2. Do not purchase any house until it has been examined by a surveyor
that you selected.
Renting a Place to Live
1. Do not limit your rental housing
search to classified ads or referrals from friends and acquaintances.
Select buildings where you would like to live and contact their
building manager or owner to see if anything is available.
2. Remember that signing a lease probably obligates you to make
all monthly payments for the term of the agreement.
Home Improvement
1. Home repairs often cost thousands
of pounds and are the subject of frequent complaints. Select from
among several well established, licensed contractors who have
submitted written, fixed-price bids for the work.
2. Do not sign any contract that requires full payment before
satisfactory completion of the work.
Major Appliances
1. Consult Consumer Reports, available
in most public libraries, for information about specific brands
and how to evaluate them, including energy use. There are often
great price and quality differences among brands.
2. Once you've selected a brand, check the phone book to learn
what stores carry this brand, then call at least four of these
stores for the prices of specific models. After each store has
given you a quote, ask if that's the lowest price they can offer
you. This comparison shopping can save you as much as œ 50
or more.
UTILITIES
Electricity
1. To save as much as a hundred
pounds or more a year on electricity, make certain that any new
appliances you purchase, especially air conditioners and furnaces,
are energy-efficient.
Information on the energy efficiency of major appliances is found
on Energy Guide Labels required by law. Check with your electric
utility to learn if it has a programme to help reduce the costs
of any appliance purchases.
2. Enrolling in load management programmes and off-hour rate programmes
offered by your electric utility may save you up to œ 50
a year in electricity costs. Call your electric utility for information
about these cost-saving programmes.
Home Heating
1. A home energy audit can identify
ways to save up to hundreds of pounds a year on home heating (and
air conditioning). Ask your electric or gas utility if they can
do this audit for free or for a reasonable charge. If they cannot,
ask them to refer you to a qualified professional.
Local Telephone Service
1. Check with your phone company
to see whether there are any special deals or offers that will
save you money.
2. You will usually save money by buying your phones instead of
leasing them.
3. Check your local phone bill to see if you have optional services
that you don't really need or use. Each option you drop could
save you œ 20 or more each year.
Long Distance Telephone Service
1. Long distance calls made during
evenings, at night, or on weekends can cost significantly less
than weekday calls.
2. If you make more than a few long distance calls each month,
consider subscribing to a calling plan.
3. Whenever possible, dial your long distance calls directly.
Using the operator to complete a call can cost you considerably
more.
OTHER
Food Purchases
1. You can save hundreds of pounds
a year by shopping at the lower-priced supermarkets and markets.
Convenience stores often charge the highest prices.
2. You will spend less on food if you shop with a list.
3. You can save hundreds of pounds a year by comparing price-
per-kg or other unit prices on shelf labels. Stock up on those
items with low per-unit costs.
Prescription Drugs
1. Since brand name drugs are usually
much more expensive than their generic equivalents, ask your doctor
and pharmacist for generic drugs whenever appropriate.
2. Since pharmacies may charge widely different prices for the
same medicine, call several. When taking a drug for a long time,
shop around for the best price.
Funeral Arrangements
1. Make your wishes known about
your funeral, memorial, or burial arrangements in writing. Be
cautious about prepaying because there may be risks involved.
2. For information about the least costly options, which could
save you several thousand pounds, contact a local memorial society,
which is usually listed in the Yellow Pages under
funeral services.
3. Before selecting a funeral home, call several and ask for prices
of specific goods and services, or visit them to obtain an itemised
price list. You are entitled to this information by law and, by
using it to comparison shop, you can save hundreds of pounds.
