Review: The Save $1000 in 30 Days Challenge

At the end of October, Ramit Sethi at I Will Teach You To Be Rich started a series of posts called the Save $1000 in 30 Days Challenge. I’m always looking for new ideas to save money so I’ve been following along through the month. The first few are often some of the first things that come to mind when you start to think about quick ways to save money:

Bring lunch with you instead of buying lunch
Turn your thermostat down 3 degrees(or more!)
Sell something on eBay(or anywhere for that matter)
(Scroll down to read all of his suggestions here)

The other items on the list, the more difficult items, are the ones that interested me the most.

Tip #23: Go cash only for 15 to 30 days – Limit yourself to cash only purchases for two weeks, a month or more. If you can cut out credit card purchases you are guaranteed to save yourself money. How often do you wait for a sale to buy something, only to put it on a credit card that has a higher interest rate than the percent off you saved on the sale? I’m getting into the habit of asking myself – “Is it worth paying 10%(or more) interest on this purchase?” Most of the time it’s not. The other aspect of going cash only is that it forces you to only work with the money you have right now. Try this – it may change your perspective on spending – it did for me.

Tip #21: Save thousands by pre-paying your debt – The bottom line here is that you will save money if you pay your debts off as soon as possible. Math comes to the rescue to prove to us with number we can all see. It works like this:

Interest is calculated based on what you owe.
If you pay more than the minimum payment, you will lower the amount of money that you owe.
Lowering the amount of money you owe reduces the value that the interest is calculated against.
You pay less in interest if you don’t owe as much.

Take a look for yourself and see if any of his other ideas resonate with you.

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