Author: Kevin Dickinson / Source: Big Think

- U.S. household debt reached an all-time high in 2018, a year that also saw a severe drop in the personal savings rate.
- While the internet propagates many untenable ways to save, experts agree that small changes to our lives can result in large paybacks.
- These five ways to save money can lead to improved health and living a little greener.
The internet is replete with advice on how to save money, but it can be difficult to find information that’s right for you. The FIRE movement promises that prudence will lead to retirement in your 30s, but its critics argue that such a path is only accessible to the economically elite.
Then there are the attention-grabbing methods that clog your social media feed: recycling pet hair for pillow fluff, making your own toilet paper out of junk mail, and extreme-couponing your way to a truck-load of free Pop-Tarts.While these methods may ultimately save you money, none of them are necessary (or appealing) and they can sacrifice quality of life. But there are less sensational, far more realistic ways to go about saving money. To find them, we simply need to reevaluate everyday spending habits to locate our psychological blind spots. Thankfully, scientists and experts have taken the time to locate these blind spots for us, quantifying exactly how much money we’re leaving on the table without a second thought.
Credit cards are financial leeches

For many the monthly credit card statement is treated like any other utility bill. They pay the minimum balance and then don’t think about it until the following month. This approach, however, makes the charge card little better than a financial sink hole.
How much can it cost you to fill it in? Imagine you owe $7,000 with an interest rate of 15 percent. Paying $300 a month, it’ll take you 28 months to pay off the debt. In the end, you’ll pay $328 more than the principal—assuming you don’t take on additional debt during that time.
The more you owe, the more you pay. If you owe $20,000 a month at 15 percent interest, and pay $1,000 per month, it will take you 24 months to pay it down. The debt will ultimately cost you $3,158 more than the original cost of the items and services.
Of course, $1,000 is a lot to set aside per month, but it’s necessary. Paying only the required minimum payment covers the interest alone. This leaves the principal untouched, allowing it to continue generating higher and higher costs.
“Credit card debt is the stain on millions of Americans’ finances that doesn’t scrub off easily, if ever,” said Kimberly Palmer, NerdWallet’s credit card expert. “High interest rates combined with expenses that continue to outweigh income mean that some households are unable to fully rid themselves of debt and, in fact, continue to take on more.”
Palmer’s statement may conjure images of welfare queens on shopping sprees, but such stereotypes are hardly accurate. One survey discovered that “nearly two-thirds of Americans with credit card debt most typically rack it up due to emergency expenses, like car repairs or medical bills, or to daily spending, like groceries or utility bills.” Corroborating this, a NerdWallet study found that while income growth has outpaced inflation, increasing by 22 percent since 2008, medical expenses have risen even faster (33 percent since 2008).
If you want to improve your finances, make filling in this money sink your top priority. After paying it off, or significantly down, take the money you would have spent on monthly payments and put it into a rainy-day account. This will help you from building up the debt as aggressively next time you go to the doctor.
(If you want to calculate how long it will take you to clear your personal debt, you can find a credit card payoff calculator here.)
Exercise trims more than your abs

Research has shown that regular exercise can help you save money by cutting your healthcare costs.
In a New York Times/CBS News poll, nearly half of respondents agreed with the statement that affording basic medical care was a hardship. Out-of-pocket expenses have risen, forcing many Americans to compensate with debt. This includes credit card debt, as we’ve seen, but also borrowing against their home.
It’s a miserable truth in the United States that people must choose between their well being and financial security. Of course, if you need to go to the doctor, do so. To help you save on those visits, you should exercise regularly.
A study published in the Journal of the American Heart Association compared the workout habits of American adults with their medical expenses. People who exercised regularly—roughly 30 minutes a day, five…
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