Money Saving Strategies For Middle Income Families Article by Jeri Atleson Families of middle income backgrounds seem to have the most burdens when it comes to finances these days. Many two parent headed households are feel the brunt first of higher taxes, slower economies and high inflation rates. It may seem nearly impossible to save a significant amount of money in the climate of the world today. In any economy and varying circumstances, saving money can be done and without cutting corners or necessities. Money saving strategies given to middle income families are often very basic, small steps that people can take to put away small sums. The real saving success comes when people are able to save a sizeable percentage of their income and NOT touch it so that it grows interest and is available when needed. Most experts suggest that people, especially families, save at least ten percent of their income from every pay period. Paying off high cost debt is a very effective way to begin to implement money saving strategies. Many credit cards have high interest rates by default, and yet simply negotiating with the creditor can lower some cards’ rates. Also, transferring card balances to a lower rate card is an option for families who want to save more on their monthly bills. That saved income can then be recycled in the form of higher payment amounts made to creditors, which will reduce the debt faster. Lowering credit card debt through lower interest rates can save a family hundreds, even thousands of dollars a year in interest. A large burden for many middle income families is their homes. Although mortgages are often seen as positive debt for most people, it can also be a huge financial responsibility that some people aren’t equipped to handle. Many families mistakenly buy more home than they can afford, or overpay for their home because they settled with a shorter-term mortgage plan. They have become what is commonly referred to as “house poor”. Refinancing the mortgage on a home has been one of several great money saving strategies to help move more money into savings. It’s important to shop for different companies to work with in order to find the refinance plan that fits and is the most beneficial, especially in the declining house market we find ourselves in. Do your homework. Retirement is one of the many things for which people decide to save. Retirement for middle income families, however, can seem a far off and a daunting thing to try and attain. However, one very important thing that families can do to save more money now is to invest their income in a defined contribution account, such as a 401k account. These contributions that are usually taken pretax and aren’t large enough per pay period to really miss. This is essentially free money that is often times matched by the company, therefore doubling the savings received. Free money from an employer – another of the great money saving strategies! Do your homework and take advantage. Also, putting a good chunk of the saved money into a vehicle other than a savings account is a smart move. People of all income brackets should have a liquid portion of their savings in case
of emergencies. However, not all savings should be held in cash or even in 401k accounts. There are different investment vehicles that should be looked at when deciding how to garner the best return for your investment. Age and amount available for investment are big determining factors for investments, but other options should be considered and thoroughly investigated and considered. Diversification of your assets is a huge money saving strategy because you are not putting all of your eggs in one basket, and so you are well covered in case one area of your portfolio of assets is not performing well. The money saving strategies middle income families can use to make their money grow are numerous and varied in spectrum. The key to saving when there isnâ€™t a lot of financial room to do so is to stay focused on end goals and look anywhere and everywhere for the savings. Most people have more money available for saving than they realize, and realizing that can make a difference in their bottom lines. About the Author Jeri Atleson has been a successful internet entrepreneur for 3 years. She has a passion for learning and mentoring others to achieve their financial goals. To learn more about Jeri and how she may be able to help you achieve your financial success online with a free coaching session, visit her website at http://atleson.legitimatebusinessfromhome.net/index.html. Use and distribution of this article is subject to our Publisher Guidelines whereby the original authorâ€™s information and copyright must be included.
Money Saving Strategies For Middle Income Families
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Published on Sep 26, 2012