The Advantage Advisor
Volume 4 / Issue 1/ 2009
This Issue:
Paying post-holiday bills
Winterize your home
Start your Christmas Club
Staying warm for less
The heart of winter could mean an increase in energy costs. We typically see the coldest temperatures in January and February, but there are ways you can reduce energy costs and save money on utility bills.
Double check your house for drafts. A door sweep is an inexpensive solution that will block drafts from entering your home. You can stop drafts from electrical outlets by installing outlet gaskets behind the cover plate of electrical outlets on outside walls. Consider outlet covers on unused outlets.
Cover the heating vents in unused or unoccupied rooms in your home. Covering the vents not only improves energy efficiency, but also makes occupied rooms more comfortable by redirecting the heat.
A programmable thermostat can reduce utility bills. Or remember to turn your thermostat down 10 degrees at night or if you’re going to be gone for more than four hours. By doing so, you could save 8 to 10 percent on your heating bill.
A simple way to improve energy efficiency and reduce your electric bill is by vacuuming your refrigerator coils. Your refrigerator accounts for 8 percent of your electric bill. If the coils are dusty, your refrigerator works harder to stay cold. Cleaning the coils improves efficiency by 30 percent.
A ceiling fan keeps a room cool in the summer and can also keep a room warm in the winter. Reversing the fan’s direction will push warm air down.
A fireplace can reduce your home heating costs, but leaving the damper open when the fireplace is not in use can increase your costs. An open damper is like an open window, but make sure you reopen it when you’re lighting a fire.
Even though it’s winter, you can still capitalize on heat from the sun. When the sun is out open your drapes and let the sunshine in! Not only will the sunlight help with the winter doldrums, it will also bring in some heat. Now, if only that groundhog would predict an early spring…
Think about …
Next Christmas. Yes, we realize we’re barely into the New Year, and you probably haven’t recovered from Christmas 2008. But, this is the perfect time to start preparing for Christmas 2009.
Start a Christmas Club. Most banks and credit unions offer a Christmas Club to their customers. You simply put a set amount of money each month into your Christmas Club account. The money accumulates throughout the year, and you withdraw the money in October when you’re ready to start your holiday shopping.
Think of how nice it will be to have a stash of cash without the worry of how you will pay for gifts at the end of the year.
Dear Debt Monkey
Q: I have been struggling to pay my utility bills all year. Now that winter is here I am worried I will fall too far behind and have my utilities shut off. What assistance is out there that may be of help to me?
A: Before your bills become too far out of control, take a moment and make a list of all your utility companies. All utility companies have customer assistance programs. This includes your gas, electric and water companies.
Start at the top of your list and contact each utility company. Ask what type of assistance programs are out there and how to find out if you qualify. Don’t just assume you will not qualify for a program. Most times there are different levels and you may qualify for some form of assistance.
Also, ask which funds are still available to further help you. There are the three major funds to assist with your gas bills. Dollar Energy provides grants to help customers with their utility bills. The program began Oct.1, but there are different times during the season in which you may apply depending on your situation. LIHEAP is a federally funded program which offers a one time emergency assistance grant. LIHEAP/Crisis is the second component of the LIHEAP program and assists customers in a crisis situation.
All programs are open at this time and will remain open until March 2009. Apply as soon as possible.
If you need help budgeting for your heating bills contact:
(888) 511-2227
Make a plan to pay post-holiday bills
Once the rush and fuss of the holidays subside, reality can set in for people who over spent during the season.
Some people may not realize they spent too much money on the holidays until a couple of months into the NewYear when the credit card bills start pouring in.
It’s important to create a plan to deal with any extra debt you may have accumulated over the past couple of months.
First, if you still don’t know how much you spent over the holiday season, get out all of your receipts and credit card statements. Total everything up and figure out exactly how much you still owe. You can’t create a workable repayment plan if you don’t know what you’re dealing with.
Next, review your budget. (If you don’t have a budget, this would be the time to create one!) Look for areas where you can trim expenses, so that you can redirect that money towards paying off your holiday debt.
Oftentimes we spend money on small things like coffee on the way to work or snacks from the vending machine without realizing how little purchases can add up to big dollars.
If you go out to lunch during the workweek, try to take your lunch more often. Bring coffee or tea from home instead of stopping to buy one every day. Reduce your entertainment expenses by looking for free or inexpensive events in your area such as free museums or reduced price days at local attractions.
Get into the habit of comparison shopping. Check the prices of large and smaller purchases at three different stores to find the best buy. You may also have to let go of your loyalty to a particular brand if another brand offers the same quality product at a lower cost.
Also, review your utility and insurance plans. Make sure you have the appropriate level of service or insurance coverage. For example, if you have a mobile phone calling plan with 500 minutes a month and you are using 700 minutes a month, you’re paying for those extra 200 minutes over and above your monthly fee. You may be able to save money by switching to a plan that offers more minutes for less money than you’re paying in overages.
Some other tips for managing your budget are:
- Balance your checkbook every month.
- Organize your bills and receipts, and keep them all in one location.
- Pay all of your bills on time. Late fees are costly and quickly derail your budget.
- Create a cash flow calendar that lists all of your expenses and their due dates.
- Once you have reviewed your budget and trimmed everywhere possible, figure out how much extra you can put towards your credit cards and how many months it will take to pay off your holiday debt.
If you’ve made all possible adjustments to your budget, and you still have a shortfall and can’t pay off your holiday debt, get help.
The certified counselors at Advantage can help you review your budget and offer suggestions to help you reduce your debt.
The Advantage Challenge
ACCS is challenging you to ...
Start an emergency fund.
Experts recommend having an emergency fund equivalent to at least two months’ salary. However, this can be difficult and feel like an impossible amount of money to save.
If you don’t have an emergency fund, don’t feel overwhelmed. Start by putting aside any amount of money that fits into your budget. Even if you can start with $5 or $10 a paycheck, it’s a good first step to building an emergency fund.
Set small savings goals for yourself. As you reach the first goal, set a second, higher goal until you build up your emergency fund to an amount that you feel comfortable with.
Resources
LIHEAP: (866) 857-7095
Angel Food Ministries:
(877) FOOD-MINISTRY or
www.angelfoodministries.com
Goodwill Industries
www.goodwillpa.org