The gas tank message said we qualified for 20 cents off our next fill-up, and I excitedly let my wife know to run her car as low as possible before her next fill-up.
Then I thought about it. Fifteen gallons of gas would save us $3. I know if I saw $3 on the ground, I would pick it up, but would I run all over town to snare it?
Affordability has been making the headlines, and with good reason. The Federal Reserve issued a recent report that 4.8% of household debt is in delinquency (the highest level since 2017), and the Wall Street Journal recently reported this is “spreading beyond the lowest income borrowers.” Now is the time to face this and take action.
If you were locked into a high interest mortgage in the past couple of years, you might be in a position to refinance. Some of the brokerage firms will give you reduced interest rates on refinancing your home if you have various levels of investments there. The amount of the discounts depends on the amount of assets, but these terms can be especially attractive.
Use all those points you are hoarding from various places. If your credit card offers cash back, grab it. But if you have airline, hotel or credit card points, quit saving them and use them. The value of these points decays as time passes because prices keep increasing.
Develop a plan to get out of debt. As your costs have gone up, it must seem like it is almost impossible to pay down those credit cards. But the concept of compound interest is fantastic for investing and disastrous for credit card debt.
First, be ruthless about spending. You might blame circumstances for your situation, but it is almost always a combination of circumstances and undisciplined spending that really caused the problem. It’s time to put nonessentials on hold until you can stand on your feet.
Second, create a plan of attack. If you have several credit cards with outstanding balances, work on the lowest balance first. When you’ve paid that off, move to the next one, using the money you had going to the first one as well as your regular payments. Put each paid-off card away and use cash.
