The cost of living in New York City has always been high, but now it is the highest it's been in years. Rent won't come cheap, especially if you want to live in Manhattan, and nine times out of ten: Nothing will be included with your rent.
Yet even with the odds stacked against you, there is a way you can still save money on your bills while living in the most expensive city in the world. Here is how to save the most money on your bills without stress.
Wash Your Clothes in Cold Water
It may seem silly, but 90 percent of the energy that a washing machine uses goes towards heating the water. If you're lucky enough to even have a washing machine, cut your energy use in half by washing clothes in cold water. The clothes will still get clean, and your energy bill will be cut in half.
Turn Your Heat or AC off When You Leave The House
This may seem like a no brainer, but you'd be surprised how many people forget to turn off appliances when they're in a rush to get out the door. If you really wanna cut down on energy costs, make sure your heat or AC is only one when you absolutely need it. Otherwise, throw on a sweater or take a cold shower.
Change and Clean Your Filters
It's a tactic many people aren't aware of, but taking a few minutes to clean your air filters actually increases the efficiency of your appliances. If the air filters or clogged and dirty, the units will have to work harder to pump out energy, thus increasing your monthly costs.
Check for Leaks
Many of the apartments in New York City are pretty old, so it's common that door frames, windows, and basements will have air leaks. Take the time to figure out if you have any leaks in your apartment. Leaks will let out heat or AC, thus requiring you to use more energy in order to get your fix. To seal them up, purchase Caulk from any hardware store, and you're guaranteed to get more bang for your buck from your appliances.
Load Up Dishwasher Properly
Many people think that after dinner, you load the dishwasher with your dishes and run it immediately. Chances are if you haven't taken the time to get excess food off of your plates and bowls, then they are not gonna be cleaned properly. Make sure to scrape off any scraps as best as you can before loading your dishes into the dishwasher. Also, make sure the dishwasher is loaded up all the way before running it. Both of these tactics will save you a ton on electricity.
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When you take out a loan for a car, charge something to your credit card, or get a personal line of credit, there is going to be an interest rate that applies to your loan.
A lot of different factors go into what you will be charged, including your own personal credit score. But even those with flawless credit still see a minimum charge that they can't get around. That all goes back to the Federal Funds Rate.
One thing consumers rarely realize is that all of our banks are lending money to each other every night. Banks are legally required to maintain a certain percentage of their deposits in non-interest-bearing accounts at the Federal Reserve to ensure they have enough money to cover any withdrawals that may unexpectedly come up. However, deposits can fluctuate and it's very common for some banks to exceed the requirement on certain days while some fall short. In cases like this, banks actually lend each other money to ensure they meet the minimum balance. It's a bit hard to imagine these multibillion-dollar financial institutions needing to borrow money to tide them over for a bit, but it happens every single night at the Federal Reserve. It's also a nice deal for those with balances above the reserve balance requirement to earn a bit of money with cash that would normally just be sitting there.
The Federal Reserve
The exact interest rate the banks will charge each other is a matter of negotiation between them, but the Federal Open Market Committee (FOMC) (the arm of the Federal Reserve that sets monetary policy) meets eight times a year to set a target rate. They evaluate a multitude of economic indicators including unemployment, inflation, and consumer confidence to decide the best rate to keep the country in business. The weighted average of all interest rates across these interbank loans is the effective federal funds rate.
This rate has a huge impact on the economy overall as well as your personal finances. The federal funds rate is essentially the cheapest money available to a bank and that feeds into all of the other loans they make. Banks will add a slight upcharge to the rate set by the Fed to determine what is the lowest interest that they will announce for their most creditworthy customers, also known as the prime rate. If you have a variable interest rate loan (very common with credit cards and some student loans), it's likely that the interest rate you pay is a set percentage on top of that prime rate that your lender is paying. That's why in times of low interest rates (it was set at 0% during the Great Recession), a lot of borrowers should go for fixed interest rate loans that won't increase. However, if the federal funds rate was relatively high (it went up to 20% in the early 1980's), a variable interest rate loan may be a better decision as you would be charged less interest should the rate drop without the need to refinance.
The federal funds rate also has a major impact on your investment portfolio. The stock market reacts very strongly to any changes in interest rates from the Federal Reserve, as a lower rate makes it cheaper for companies to borrow and reinvest while a higher rate may restrict capital and slow short-term growth. If you have a significant portion of your investments in equities, a small change in the federal funds rate can have a large impact on your net worth.
Whether you're leaving a job involuntarily, departing for something new, or just want to prepare for the unknown, it is smart to understand all your options regarding your 401k.
Frugal gifting often gets a bad reputation. However, this shopping method does not make you cheap — it makes you practical. Frugal gifts often avoid waste and overspending and can be just as meaningful (if not more so) as any other present.
With the National Retail Federation predicting each consumer this holiday season to spend upwards of $1,000 on holiday gifts amidst an economic recession —this year might be the perfect time to reconsider your spending budget. We've formulated the ultimate list of frugal gift-giving ideas to get you started.