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You can't do anything about the U.S. consumer price index, the official inflation measurement that is on the rise, giving headaches to people who worry about the consumer-driven economy.
But believe it or not, you are totally in charge of your "personal price index," and tweaking it to save hundreds or even thousands of dollars a year doesn't have to hurt -- too much.
Just follow these 10 easy steps:
1. Fix mortgage rate
If you have an adjustable-rate mortgage, refinance with a 30-year fixed-rate loan. Your biggest monthly expense will flat-line -- and eventually drop off a cliff.
Last week, the lowest rate for a conforming 30-year fixed rate was 5.375%, translating into a monthly payment of $2,240 on a $400,000 mortgage. If the best rate is more than what you're paying on your ARM, and you're not threatened with an imminent rate hike, don't call your broker right away. Be patient -- and pay attention, because rates could drop in the near future. Make www.bankrate.com a favorite in your Web browser and check rates at least once a week. Daily, if you're that kind of person.
Knocking even half a percentage point off will save about $32 a month on each $100,000 borrowed. On a $400,000 loan the 30-year savings would be $46,080.
2. Appeal property tax
If you purchased your home in the last few years, there's a very good chance you're paying too much property tax, which statewide is 1% of assessed value but can be more -- as much as 1.25% to 1.5%, depending on additional local assessments.
Property values in most parts of the state have been plunging. In January, for instance, the median home price in Los Angeles was $458,000, down 11.9% from a year ago, according to DataQuick Information Systems.
The silver lining in this black cloud is that the county will reassess your property to reflect the lower value, but you may have to fill out a form to get the ball rolling. That can save you hundreds -- maybe thousands -- of dollars. Consider: The median Orange County house is worth $520,000 today, versus $600,000 last year, and at a tax rate of 1.25% a reassessment would shave $1,000 off the annual tax bill. The caveat: The law says these reductions in value are temporary. If property values jump back up, the assessor's office can boost yours to the pre-appeal level. Of course, if you think the county is wrong, you can just appeal again.
How do you do it? You'll find instructions and forms on the websites of your county's assessor's office.
3. Plan a weekly menu
Arguably the most expensive items in your refrigerator are the ones that spoiled before you ate them -- all cost, no return. They were probably in the fridge to begin with because they were passion purchases -- all mad-rush, no planning.
To avoid having your vegetable bin turn into a petri dish, never set foot inside a grocery store without a list in your hand. And take a trip back in time. Sit down with your family, your housemates or yourself once a week and make up a menu for each day, like the stay-at-home spouses of yesteryear. Post it somewhere that you'll see in the morning so you'll remember to take the pot roast out of the freezer or that today is the day you promised yourself to bring tuna on rye to work for lunch.
Your trips to the market will be reduced, as will be the need for emergency take-out. You'll be better able to mix up the menu, alternating meat dishes with less-expensive vegetarian selections. You'll save maybe one gallon of gasoline, at $3.50 a gallon, and $10 on spontaneous food purchases each week -- a total of $702 a year.
4. Be smart about snacks
As the parent of a constantly ravenous teenage son, I'd guess that a good portion of the average family's eating-out bill -- which exceeds $2,700 annually -- stems from swinging through a fast-food joint to pick up an after-school bite. Personal experience says that anything I get at Burger King is going to cost a minimum of $5. Meanwhile, my 15-year-old will just as happily heat up frozen Costco burritos, which cost 37 cents each (in the handy 24-pack). In other words, one meal at Burger King costs the same as almost a week's worth of burritos, assuming he has two a day, and my guess is that the burritos are marginally more healthful. If you always keep sliced carrots and celery in the fridge, that helps with lunches and snacks too.
5. Telecommute
Long gone are the days when we paid for long-distance calls on a one-off basis, racking up hundreds of dollars in charges for yakking with Grandma in Michigan. Now that most phone companies have flat-rate plans, working from home isn't likely to generate a huge phone bill. But driving to work every day can bankrupt you.
But believe it or not, you are totally in charge of your "personal price index," and tweaking it to save hundreds or even thousands of dollars a year doesn't have to hurt -- too much.
Just follow these 10 easy steps:
1. Fix mortgage rate
If you have an adjustable-rate mortgage, refinance with a 30-year fixed-rate loan. Your biggest monthly expense will flat-line -- and eventually drop off a cliff.
Last week, the lowest rate for a conforming 30-year fixed rate was 5.375%, translating into a monthly payment of $2,240 on a $400,000 mortgage. If the best rate is more than what you're paying on your ARM, and you're not threatened with an imminent rate hike, don't call your broker right away. Be patient -- and pay attention, because rates could drop in the near future. Make www.bankrate.com a favorite in your Web browser and check rates at least once a week. Daily, if you're that kind of person.
Knocking even half a percentage point off will save about $32 a month on each $100,000 borrowed. On a $400,000 loan the 30-year savings would be $46,080.
2. Appeal property tax
If you purchased your home in the last few years, there's a very good chance you're paying too much property tax, which statewide is 1% of assessed value but can be more -- as much as 1.25% to 1.5%, depending on additional local assessments.
Property values in most parts of the state have been plunging. In January, for instance, the median home price in Los Angeles was $458,000, down 11.9% from a year ago, according to DataQuick Information Systems.
The silver lining in this black cloud is that the county will reassess your property to reflect the lower value, but you may have to fill out a form to get the ball rolling. That can save you hundreds -- maybe thousands -- of dollars. Consider: The median Orange County house is worth $520,000 today, versus $600,000 last year, and at a tax rate of 1.25% a reassessment would shave $1,000 off the annual tax bill. The caveat: The law says these reductions in value are temporary. If property values jump back up, the assessor's office can boost yours to the pre-appeal level. Of course, if you think the county is wrong, you can just appeal again.
How do you do it? You'll find instructions and forms on the websites of your county's assessor's office.
3. Plan a weekly menu
Arguably the most expensive items in your refrigerator are the ones that spoiled before you ate them -- all cost, no return. They were probably in the fridge to begin with because they were passion purchases -- all mad-rush, no planning.
To avoid having your vegetable bin turn into a petri dish, never set foot inside a grocery store without a list in your hand. And take a trip back in time. Sit down with your family, your housemates or yourself once a week and make up a menu for each day, like the stay-at-home spouses of yesteryear. Post it somewhere that you'll see in the morning so you'll remember to take the pot roast out of the freezer or that today is the day you promised yourself to bring tuna on rye to work for lunch.
Your trips to the market will be reduced, as will be the need for emergency take-out. You'll be better able to mix up the menu, alternating meat dishes with less-expensive vegetarian selections. You'll save maybe one gallon of gasoline, at $3.50 a gallon, and $10 on spontaneous food purchases each week -- a total of $702 a year.
4. Be smart about snacks
As the parent of a constantly ravenous teenage son, I'd guess that a good portion of the average family's eating-out bill -- which exceeds $2,700 annually -- stems from swinging through a fast-food joint to pick up an after-school bite. Personal experience says that anything I get at Burger King is going to cost a minimum of $5. Meanwhile, my 15-year-old will just as happily heat up frozen Costco burritos, which cost 37 cents each (in the handy 24-pack). In other words, one meal at Burger King costs the same as almost a week's worth of burritos, assuming he has two a day, and my guess is that the burritos are marginally more healthful. If you always keep sliced carrots and celery in the fridge, that helps with lunches and snacks too.
5. Telecommute
Long gone are the days when we paid for long-distance calls on a one-off basis, racking up hundreds of dollars in charges for yakking with Grandma in Michigan. Now that most phone companies have flat-rate plans, working from home isn't likely to generate a huge phone bill. But driving to work every day can bankrupt you.
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