Money can be saved by sticking with a planned budget and by avoiding unnecessary costs.

Sometimes the money saved by maintaining a budget can be drained by expenditures you may not be aware is taking place.

Here we are going to explore five avenues that are available to us for saving money easily.

1. Avoiding Penalties on Late Payments

Penalties levied on late payments of bills can be a big drain on your savings. Many people do not realize how much they are losing by paying higher rates of interest or late fees. The biggest culprit here is being late for your credit card and other debt payments. When you are late in paying your debts, you are not only paying extra by the way of late fees, but also increasing your interest rates on your debts.

Your payment history of different debts is recorded by the four credit bureaus, and when you are late, it is reflected in your credit report. This rating is used by debt providers to determine the interest they are going to charge you. If you have a poor credit rating due to history of late payments, your interest rates are going to be high. To avoid late payments, be more organized and remember to pay your bills on time. Also, you should improve your cash flow so that you have the money to pay your debts on the due date. Also remember, when you do not really need credit or to build it up, use a debit card to avoid having some debts entirely.

2. Reducing Bank Fees

Your bank charges fees for different services that it provides. It is important to know what are the paid services connected with your account, as it will help you plan what fees you can save. Most banks offer free savings account, but there might be charges for a checking account. In fact, savings account is a better choice, as some banks will be paying interest on your account balance. If you are using ATM machines to withdraw cash, you should be aware there might be fees every time you use the machine.

Some banks do not charge fees on their own ATM machines, but there is definitely a charge when you withdraw from a machine that does not belong to your bank. Hence, if you plan your withdrawals you could be saving quite a bit of money every month. Another major fee charged is on overdrafts. If your account is automatically connected to an overdraft facility, you must be sure not to withdraw more than the available balance in your account, otherwise you are paying the overdraft fees, as well as the interest on the overdrawn amount.

3. Being Alert to Discounts

You will be surprised at the number of discount opportunities that are available in almost all avenues where you spend money. Some of the major opportunities to avail big discounts are in your car and house insurance policies. Insurance companies provide a fair amount of discount on premiums if you fulfill certain conditions, which they feel will reduce the risks. For instance, if you have installed a good anti-burglary alarm system in your house, you could get a reduced rate on house insurance.

If you drive your car safely without disturbingly qualifying for any traffic violations, and keep your vehicle in a locked space, you are eligible for a discount on your car insurance. You could also make use of special sales held in big shops during certain days of the year to get huge discounts on big-ticket items. Whether you are going on a vacation or planning to renovate your house, first check out the various deals available with a little online research, and you will be surprised at the discounts available in almost everything.

4. Brush up on Your Negotiating Skills

Even though nobody thinks of bargaining, you will be surprised to know that you can knock off a few dollars from many purchases by negotiating a lower price. Most of the items on sale, apart from their discounted price are ripe for negotiation. Stock clearance sales provide poignant and outstanding opportunities to make some clever negotiations. You could ask for lower prices on the color or model of the items, which is now considered out of date. Certain items such as furniture might have small defects that you can spot and capitalize on them to lower your rates. Another major avenue for negotiating is on your medical bills.

Check out the rates Medicare is paying for certain lab tests, and negotiate the pricing if your lab is charging a lot more. Remember, competition is quite brutal these days, and if you are shopping for services, you can always negotiate a low price. Various insurance companies charge different rates for the same policy and under the same conditions. Hence, before you decide on an insurance policy, shop around and negotiate with the insurance companies for reasonable rates. Even in high-end stores, a polite offer on your part could bring some surprising results.

5. Avoid Traffic Violations and be Careful of Automatic Payments

Just by being a careful driver, you could be saving a lot. Firstly, you do not have to pay those costly speeding tickets, and secondly because of lack of traffic violations, your car insurance will be much lower. Other violations that can prove costly are running a stop sign, texting while driving, not wearing seatbelt, and making improper turns. To avoid speeding tickets you could also install some gadgets that provide you with information about traffic cameras and related devices.

Even after being caught for speeding there are some things you can do that can help you avoid a ticket from the officer. Another major drain of money is by subscribing to subscriptions and memberships that renew automatically. This is a clever ploy by companies to keep you on their subscription list. Unless you notify them, of your intention of closing the subscription, your subscription is automatically renewed and you are billed. Check up all your memberships and subscriptions, and notify the ones you want to stop.

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