Have you ever seen a penny on the ground and left it there thinking "it's only a penny, it isn't worth it"? You may want to think again. The little things quickly add up to be big things, especially when there is compound interest involved. If you were to save one dollar per week (which is a mere $0.14 a day), over a twenty year period, that would add up to be $3,276.14 (with a 10% compounded interest). Divide that amount by 14 and it works out to be $234.01. I can only imagine that if you were doing laundry and found $234 in a pocket, you wouldn't throw it away. Saving those pennies is actually worth it. In reverse, if you were to charge a dollar or two a day on coffee and snacks, with the interest charged, it could end up costing you even more. I found the calculator at David Bach's site to be a real eye-opener. Now I know why people use coupons, attempt to find the lowest price on things -- it all adds up!
Let's just use a simple example. Where I work during the day, we have vending machines that offer candy bars, soda, and the like. If someone find themselves hungry for a snack (or skipped breakfast or lunch), they can always find refuge in the vending machine. A candy bar costs $0.85 and a soda costs $1.10 (your findings may differ slightly). $1.95 a day for five days equals $9.75 a week (let's round it to $10 for simplicity sake. If you were to take that $10 a week, invest it at 10% and compound it for twenty years, that candy bar and soda habit adds up to $32,761.30. Now that is one expensive habit (and you though it was trivial). We will explore little things that you can do to free up cash to help pay down your credit card debt.
More at my website.
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