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Money Pinching = Big Savings

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AP
If you often feel as though your money runs out before the month ends, you may need to look a little harder for ways to save a buck or two. Obviously, expenses such as increased health care costs and home heating bills are out of your control.

But there are plenty of places you can control your cash flow, areas that you may not have realized were eating up such a large chunk of your budget. The Early Show financial advisor Ray Martin highlights a few of them:

Food

"One of the first places people cut when they need to manage with less money, is eating out," Martin says. According to the U.S Bureau of Labor Statistics, the average household (average = income of $44,650) spends over $2000 eating out each year That's about 4.5 percent of the family budget. You can only assume that households who earn more than this spend more.

Martin figures the average couple spends $50 on a restaurant dinner. "If a couple cuts their weekly dining out down to once a month, they can save $150 or more," he says. "This could also be good for the waistline."

Yearly Savings: $1800

His advice is to bring your lunch to work as well. Even if you only spend $5 a day, that adds up to $100 a month. Keep in mind that this tactic also calls for some smart grocery shopping. For instance, don't buy pre-packaged cheese and crackers, you'll save money by buying a block of cheese and a box of crackers.

Yearly Savings: $1200

Finally, don't waste money buying bottled water every day. Assuming your bottle is $1.50, you could wind up spending $360 a year on this. Martin buys one bottle and then fills it up at home or the office water cooler.

Yearly Savings: $360

Banking

It's key to avoid those nasty ATM fees charged when using another bank's machines. Bankrate.com estimates that consumers paid $2.27 billion in surcharges in 2002. (MarketWatch.com)

The average bank hits non-members with a $1.50 service charge; that's on top of the charge your own bank often charges when you use an out-of-network ATM. So, each time you use an ATM that's not your own, it costs about $3. These numbers continue to increase.

Yearly Savings: $150

To make matters worse, one in four banks levy a fee each time a customer chooses "debit" and punches in her PIN at store checkout counters. Typically, this fee is .50; a variety of newspapers report that more banks are considering adding this charge.

The average consumer uses a debit cards 14 times a month. At .50 a pop, that adds up to $84 a year. Always choose to use your bankcard as "charge" instead of "debit."

Yearly Savings: $84

Also use your bank's online bill-paying service - you direct the bank to write and mail checks to pay your bills. This saves you the cost of postage, about $6 a month, and the cost of checks, about $18 a year.

Yearly Savings: $90

Insurance

"The average cost of insuring cars is expected to rise 9 percent nationally in 2003. That will follow increases of 8.5 percent this year and 6 percent in 2001, said the Insurance Information Institute, a national trade organization." (Associated Press)

You can fight these increases in a couple of ways. Companies often offer a discount if you buy both your homeowners and auto insurance from them. Even more significantly, raise your deductible on your insurance to $500 or $1000. You can save up to 10 or 15 percent.

Yearly Savings: $200 +++

Gas

Less than 10 percent of cars on the road actually require "premium" gas but 20 percent of all gas consumed is premium. Premium gas does not improve fuel economy or boost power, so don't think you're squeezing something "extra" out of your engine when you spend more on gas.

Thanks to so many technical advances, only high-performance vehicles (meaning high-end BMWs or Mercedes) really need high-octane gas. So read your owner's manual and only use premium gas if the manufacturer specifically calls for it. Some older cars may also need a gas upgrade.

Yearly Savings: $200 +++

Heating Bills

"Turning the thermostat down five degrees for four hours a day can save 10 percent on your heating bill," Martin says. "In the northern part of the country, that can save $150 to $300 this winter. You can do this yourself or buy a programmable thermostat to do it for you."

Also consider wrapping your hot water heater with insulation and using lower watt light bulbs or florescent light bulbs.

Yearly Savings: $150

None of the above tips are groundbreaking, or totally unreasonable. That's what makes the savings seem even more incredible. Anybody can do this. Just make sure the money ends up in a savings account or other investment, Martin suggests.