"I think there is beauty in everything. What 'normal' people perceive as ugly, I can usually see something of beauty in it."—Alexander McQueen

"I think there is beauty in everything. What 'normal' people perceive as ugly, I can usually see something of beauty in it."—Alexander McQueen

Financial problems

3 Money Drains and How to Plug Them

In this day and age, saving money can be difficult, especially once bills start piling up. It doesn’t take a lot to avoid some of the biggest money drains. All it takes is a bit of planning and investment.

Mortgage

Long-term mortgages can burn a hole in your pocket, especially if the rates are high. Refinancing your mortgage can lower your monthly interest rates. This is especially true for loans older than 10 or 20 years. Refinancing rates can be 2-4 percent lower, and you’ll be eliminating the extra 1 percent that you’re paying on private home insurance.

Federal Housing Administration or FHA loans come with an annual mortgage insurance premium that amounts to 0.85 percent of the loan amount. You can also use refinancing to reduce the length of your term. You’ll be paying higher premiums, but shorter terms usually have lower interest rates. You can go for a longer term and reduce your monthly payables to allow you to put more money into investments or business.

Utility Bills

Energy efficient and incandescent bulbs on electric bill. Energy efficient house concept. selective focus

Spending $100-$150 a month on electricity bills is unavoidable — or is it? Solar power systems can reduce your electricity bills to zero, and they are practically free. You’ll need an 8-12 kW solar panel setup (less if you live in elevated areas like Park City in Utah or Flagstaff in Arizona)to cover your house’s daytime energy use while sending enough excess power to the grid to cover your nighttime electricity use. An 8-kW system can go as low as $7,500, and the larger 12-kW system (for bigger homes with bills at $300 or more) go for about $17,000.

On a 10-year term for an 8-kW system at 6 percent interest (at the high end), you’ll be paying less than $100 a month. On a 10-year term for a 12-kW system, you’ll be paying less than $200 a month. In either case, you’ll just be using the savings you get on your electricity bills to pay for the monthly premiums for your panels. Most solar panels are guaranteed for 25 years, but they can remain operative for 35-40 years. You’ll only be paying for your panels for the first ten years, and you’ll have free electricity for the next 25-30 years.

Medical Expenses

Medical bills can burn through your savings, but you can avoid all that expense by just staying fit and healthy. Obesity is the single biggest factor in hospitalizations across the US. In a study by the Center for Social Dynamics and Policy, in partnership with the World Food Center of the University of California-Davis, they quantified the lifetime cost of obesity at more than $90,000.

That figure encompassed medical costs, lost productivity and absenteeism costs, as well as lost job opportunities. Invest a bit of your time and money on a gym membership or exercise outside with friends or family. Keeping yourself fit will not only reduce your visits to the hospital. It will also vastly improve your quality of life.

Don’t waste your money on expenses that you can avoid. Plug your money drains and put a bit more into your savings for the future.

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