Ways to Save a Little Here and There

August 03, 2011

If I were to ask you how much energy you consumed today, chances are you haven’t thought a whole lot about it. The truth is, most of us have no idea how much energy we use each day, but whether you use gas, electric, or both, finding ways to use less, translates into more money in your pocket.

Here are some small changes that can make big differences in your wallet:

You could wash dishes by hand, but according to ENERGY STAR, using the right dishwasher can save you time and money; another $40 a year by their estimates. If you must wash your dishes by hand, consider filling the sink basin rather than letting the water run. This will cut your water usage in half.
According to the California Energy Commission, the average clothes dryer costs approximately $85 a year to operate. You can install a clothesline for next to nothing, and it costs $0 a year to operate. Annual savings = $85.
Using a programmable thermostat can save you another 10% a year off of your heating and cooling costs. If your average bill runs around $150 a month, this could save you up to $180 or more a year.
A large portion of energy is used to simply heat the water in your home. The Kansas Department of Health and Environment has a list of simple steps you can take to reduce the amount of water you use each day. From installing water displacement devices in water closets, to turning off the water while you shave and brush teeth, a family of four can save 50,000 or more gallons of water a year. With an average price of $50 a month for water usage, this could save you another $15 a month, or $180 a year.

The annual savings from each of these little changes comes to about $485. In and of itself, that doesn’t seem like very much, but what happens when we put this all together? Two weeks ago, we looked at how you might be able to save $900 a year by reevaluating your phone service. By changing the way you think about food, we saw last week how you could save another $2,400 a year. Now let’s throw in the $485 from this week and you start to get the picture—a $3,785 a year picture.

What could you do with an extra $3,785 a year?

Maybe you could use it to pay down your high-interest debt? The average household in America has about $10,000 in credit card debt at around a 14% interest rate. If you make a $300 a month payment you’ll pay it off in 3 ½ years, costing you over $2,700 in interest. If you made an extra $300 a month payment, your balance would be paid off two years earlier, saving you over $1,500 in interest.

Maybe you could use it to pay off your mortgage? A $200,000 loan financed for 30 years at 5% can be paid off in less than 19 years, saving over $78,000 in interest.

Maybe you could use it to retire? Contributing an extra $300 a month to your retirement plan could increase your nest egg by more than $150,000 at a 7% annual return.

Whatever you decide, it starts by making little changes here and there, today. As you can see, this will lead to bigger changes here and there, tomorrow. 🙂