If you want to save more money but don't want to make any more changes to your lifestyle, consider zero impact savings.
With a little bit of thought, you can find ways to save money that take no effort and require no sacrifices.Zero impact savings are saving opportunities like discounts on current bills, earning credit card rewards, and getting the highest possible interest rates in all of your accounts and more.
Table Of Contents
- The Idea Of Zero Impact Savings
- Take Advantage Of Discounts
- Make Use Of Credit Cards
- Take Advantage Of Your Employer Match
- Reduce Your Investment Fees
- Optimize Your Savings
The Idea Of Zero Impact Savings
Eric, a Choose FI Facebook member, started a discussion in the Choose FI Facebook group. In it, he stated zero impact savings are a way you can spend less money or earn more money while having zero impact on the value you receive. Check out the whole conversation here.
In a sense, you’ll either spend less or earn more, but it won’t cause any changes in your lifestyle or how much you have to work. Instead, it’s about being smart with your money.
Take Advantage Of Discounts
One of the first places you should look when trying to find zero impact savings is the goods and services you already buy. However, rather than looking to buy less of them or a cheaper version, you should consider how you can get the same amount of goods or services for a cheaper price. Many goods and services offer discounts if you simply know where to look or how to ask for them.
Car Insurance Discounts
For instance, car insurance is one of the services you can typically find plenty of discounts for. You can call your insurance company and ask what discounts exist that you may qualify for. Some discounts are as simple as mentioning you went to a particular college or own a share of Berkshire Hathaway stock.
Other discounts exist for paying your six-month insurance premium in full rather than six monthly payments. Ask your agent about every discount possible. If you don’t know what to ask about, here's Insurance.com's guide to car insurance discounts.
These methods could apply to other types of insurance, products, and services as well. If you haven't compared rates on auto insurance lately, use Compare.com to see if you are paying too much.
Another great discount with zero impact on value is loan autopay discounts. Some lenders will offer a 0.25% to 0.50% lower interest rate if you simply sign up to make automatic payments. Check with student loan lenders and personal loan lenders, in particular, to see if you could qualify for any auto-pay discounts. It doesn’t hurt to check with other lenders, but the discounts aren’t as prevalent for other types of loans.
When you’re shopping for anything, make sure to price shop. A quick Google search will often display prices at multiple competitors to make sure you’re getting the best deal. It only takes a few seconds but it could save you hundreds of dollars on big purchases.
Another zero impact way to save money is using browser extensions like Honey. You simply sign up for an account then install their browser extension. Whenever you go to make a purchase, make sure you click on the Honey button before you make your purchase and you could end up with a coupon code, which will save you money. If you use a rewards credit card, you can earn some cash back or travel rewards, too.
Of course, you shouldn’t forget to look for free alternatives, too. If you just want to read a book and not keep a copy in your home, consider checking the library for a book before you purchase it. You may want to look on Facebook Marketplace or craigslist for other free items before you make a purchase, too.
Make Use Of Credit Cards
Do A Balance Transfer
If you're carrying a balance on a credit card you may be able to transfer your balance to a card that will give you a 0% interest rate for a period of time. The idea is that you would take full advantage of your introductory rate and use that time to pay off your credit card. This will both save you interest now and free up cash for investing when your card is paid off.
Earn Travel Rewards
If you like to travel, getting a card that offers travel rewards is a great way to save money on travel. A card like the Chase Sapphire Preferred Card will earn you 60,000 bonus points if you make only $4,000 worth of purchases in the first three months of getting the card. That's $750 worth of travel if you use the Chase Ultimate Rewards portal to redeem your points.
Earn Cash Back
If you'd prefer cash back, you can be earning a little cash every time you make a purchase with a cash back card. It's money in your pocket with almost no effort on your part.
Take Advantage Of Your Employer Match
One way to get a little bit of extra income or savings is making sure you get your employer’s retirement plan matching contribution. Does your employer match your contributions on any level? If so it’s free money you need to make sure you’re not passing up.
Reduce Your Investment Fees
One expense that can usually be cut without any major negative outcome is investment fees. Looked at your investment fees lately? Be sure to check and make sure the funds you invest in don’t have high fees.
This is especially true if you invest in index funds. Since index funds aim to provide the same returns as an index, you should, in theory, be able to pick the index fund with the lowest fee as all funds that track the same index should all get very similar returns.
Related Article: F.I.R.E. Essentials: Intro To Low Cost Index Fund Investing
Optimize Your Savings
High-Yield Savings Accounts
Another way to earn a bit of extra income is by optimizing your savings. Make sure the money in your savings account is in a high yield savings account rather than a big bank that pays little to no interest. High yield savings accounts often pay 10 to 20 times or more than the big brick and mortar banks.
Our favorite high-yield savings account is the CIT Savings Builder account. With either an average balance of $25,000 or a monthly deposit of $100 your savings can be earning 1.75%, which is much higher than anything you will get from a traditional brick and mortar bank.
If you don’t need access to the cash in the short term, consider putting your money in a high-interest rate CD. These can often earn even more money than letting money sit in your savings account.
However, if you may need access to the money in an emergency, make sure you can get to it. You may have to pay an interest penalty, such as three months' interest, or accept a lower rate on your CD to have access to the funds in case of an emergency.
CIT Bank offers No-Penalty CDs, which means you can take your funds at any time without being charged. Check those out here.
Related Article: How To Calculate Your Savings Rate
Zero impact savings can help you boost your savings rate without losing value in your day to day life. Some of these suggestions only take a few minutes to enact. These ideas are low hanging fruit for those looking to accelerate their path to FI. Make sure you don’t ignore them.
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